ECONOMIC IMPACT OF ADVERTISING IN CORPORATE COMMUNICATIONS

By;

Assenga Vera C

In tracing the relationship between advertising and economics we should always lay the foundation in the knowledge of the " consumer behaviour theory "

Is knowing how people or consumers behave is always the starting point for marketers and advertisers.  This knowledge determines the impact an advert will create to the process of production ,consumption ,distribution , and exchange

Advertising generally means a communication process whose purpose is to inform the potential customers about products and services and how to use them

In that case, advertising can play a significant role in the economy of people , customers specifically when it is positive and effective

When advertisement is negative and not effective then the economy suffers at large .Therefore the impact depends on the types and effectiveness of the advertisements

We can therefore expect effects as follows.

1 QUALITY OF THE PRODUCT OR SERVICES

Means when we have advertisement of the products or services each one of the manufacturer try to improve the quality of the product .

If the product are many of high quality consumers get more benefits

2 INFORMATION UTILITY

People will acquire information about product or services through advertisement and utilize it by own benefit
If no any advertisements made people will not be in a position to know it

3 PRICE SETTING

When we have adverts men ts they  will be many competitors thus no way will a company set high price otherwise the consumers will shift to another but through adverts meant the company sets price according to how others price are and have been advertised
' setting a price in relations to other '

4 COMPETITION

If  there is competition consumers can choose what they have to but or purchase .In economy it helps in value added tax (VAT) because of many companies thus the money will also be used to develop a country in other sector

5 DEMAND AND DISTRIBUTION

Adverts increase the demands of a certain product and if a consumer buy will pay tax , the higher you buy demand the better the economy when we have many products in the country you will have more people receiving the products through paying VAT

therefore people will pay more tax to the government

6 CONSUMER CHOICE

When a consumer have more options to get more benefits of choosing what to produce thus the government can get VAT.

7 BUSINESS CYCLE

The overall business of a county is improved more products are advertised thus more money moves to the hand of people through business cycle.

Business economy improves because it grows faster in a country where business is stagnant there is no development but through adverts can make economy to be improved

8 PROVISION OF EMPLOYMENT

People will work on more advertisement agencies and also when advertisements are made more people will purchase a product or services and more people will be employed in that area to offer services and also the organization or company will also pay tax to the government