Advertising can build awareness of your brand and products.
Companies use various types of advertising when promoting their wares, including display, Internet, classified, direct mail and TV and radio advertising. The goal of most advertising is to apprise consumers or businesses about a company's products or services. Without advertising, consumers and businesses would need to accidentally discover a company's products or services, which is not practical in the business world. However, there are also other key ways in which advertising can help a business.
Building Brand Awareness
Companies use advertising to build awareness of their brands. A business owner wants customers to think of his business when they need the types of products he sells. Therefore, most business owners and companies advertise consistently to build brand awareness. Advertising draws attention to your brand, then communicates key benefits to users, according to marketing expert Dave Dolak. Consequently, consumers tend to remember certain benefits of brands through advertising, including which ones offer better taste or lower prices.
Increasing Sales
Companies use advertising to increase sales. Most business owners and corporations expect a certain return on investment from their advertising. A company that spends $300 per month on a "Yellow Pages" ad, for example, may expect to earn $1,200 per month from customers who see those ads. Hence, the company's return on investment is 400 percent. Companies that do not have sales departments might depend on advertising for 100 percent of their business. Internet and mail order companies are two types of businesses that rely almost exclusively on advertising for generating sales.
Creating a Niche
Companies can also create a certain niche for their businesses through advertising. For example, a car company might want to be known for producing high-quality vehicles. An auto rental company might want to be known for offering the best service in the industry. Therefore, companies will often use certain themes in their advertising that reinforce key attributes of their products in the minds of consumers. Additionally, companies also will use memorable slogans to create their niches within the industry.
Building Market Share
Advertising also can be used to build market share for businesses. Market share is the total sales dollars and units a company earns out of all sales dollars and units in the industry. Building market share requires attracting loyal customers who use a company's products consistently. However, companies need to back up the claims of their advertising to build a loyal customer base. Therefore, companies must ensure that employees fully understand their advertising goals for the advertising to be effective.
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