Advertising is a core business function and necessary expenditure that can build and maintain strong brands. I believe that advertising is essential for any organization with a product to sell or a service to offer. It is, in fact, equally important as accounting, cost analysis, production, supply chain management, and sales. Advertising also accounts for a substantial portion of our economy. Companies spent nearly $150 billion on advertising in 2006 – in the United States alone. However, advertising dollars are not always spent wisely; companies that receive a substantial return on their investment usually build strong brands and achieve high revenues. However, a mismanaged campaign or misappropriated funds can drain capital from a company without offering any of the desired results.
A company’s products or services are ultimately rendered useless if nobody is aware of them; hence the need to advertise. Advertising, however, is a subtle science; a craft that fails more often that it succeeds. It is very difficult to reach a consumer, especially in this modern digitized era of TiVo and digital recorders. Consumers have an innate sense of what is important to them and what they can disregard – a wall of selective perception that only allows certain messages to even breach the mind. It is the advertiser’s responsibility to crack this barrier, reach the consumer, and preach a product’s benefits or attributes – all within a thirty second spot or on one single sheet of paper.
Yet without advertising, we would not have the brands with which we are so familiar today, such as Coca-Cola and Apple.
Coca-Cola, for instance, had enjoyed a leading market share in the United States for years, until taste tests in the early 1990s revealed a preference for the sweeter Pepsi. Coke panicked, and hastily created “New Coke” to match Pepsi’s taste-testing advantage. However, consumers responded negatively, and Coke was forced to rebrand its original formula as “Coke Classic,” to the relief of millions of loyal consumers. Coke quickly learned that the strength of the company lay not in the taste of its product, but more or less in the consumer’s attachment to the brand itself. Decades of strong advertising and useful taglines crafted Coke’s rock-solid image.
Apple has also used advertising to thrust itself at the forefront of the laptop computer market. Macs had always enjoyed an advantage over other personal computers in terms of graphics and multimedia, but they had not used the right advertising to exploit these advantages. The current campaign portrays Macs as trendy, modern, and intelligent, while other personal computers are assumed to be outdated and useless. And consumers have responded: Macs are now the most popular laptop computer on college campuses.
These two brands have clearly used advertising to forge specific identities, allowing them to maintain a loyal fan-base while continually attracting new consumers.
Advertising is a core business function which, if used correctly, can build brands and maintain a brand’s strength over time. It is expensive, but necessary, and is undoubtedly vital to the success of any business-to-business or business-to-consumer company.