Theory question 105
AdvertisingCommerce 2 (essay)
(a) Explain five reasons for which manufacturers advertise their products.
(b) State five reasons for the continued criticism of advertising.
Show the model answer
(a) Any five, explained: to introduce a new product; to increase sales of existing products; to inform consumers about uses, prices and where to buy; to persuade consumers to buy; to meet competition/retain market share; to build a good image and brand loyalty; to remind customers; to educate on new uses.
(b) Any five: it raises costs and prices of goods; it can be false or misleading; it makes people buy what they do not need (wasteful consumption); it may promote harmful goods (alcohol, tobacco); some adverts are indecent or offend culture; it helps big firms create monopolies; competitive advertising wastes resources.
Criticisms are mostly that advertising raises prices and misleads.