What Role Does Advertising Play in Microeconomics
By and large, companies depend very much on advertising – they pay hefty amounts to the media, pitch in professionals to churn
out the best advertisement concepts possible, and study the after effects of the advertisement, whether they have helped in reaching
the brand’s goals or not. The main aim of advertising is to take a product well into the customers, raise the sales and retain the
same, sustain the brand image of the company and the trust that the customers have in the company.
Advertising impacts the economy, the thinking of the customers, the competitiveness of the market, and the demand and the supply.
Behind the scenes, advertising follows many concepts – customer’s tastes, budget, lifestyle habits, thinking attitude, competitor
analysis and many more.
At micro level, or talking in terms of micro economics, the impact of advertising is very profound. This post discusses some areas
of micro economics where advertising plays a key role.
Roles Advertising Play in Microeconomics
1. Decision making Process
When advertising is all about impacting the customers’ mind and making them think about the usage of the product that is being
advertised, no doubt that the decision making process of both the customers and the companies is based on advertising.
