Like everyone reading this, you have no doubt been hit with an advertisement for a food product, or perhaps a restaurant, and instantly wanted the item. Maybe it was an internet ad or maybe a television ad during your favorite program. You saw the ad or commercial and you just had to have the product. Maybe it was for something you never considered, but after seeing the ad, you changed your mind. Like all people in the modern age, you are highly susceptible to commercial advertisement.
Now, you are probably thinking, “I’ve never had this happen. I just ignore advertisements on-line.” Of course, you would be right. There’s little data to suggest advertisement drives consumer behavior all that much, but the people producing the ads and selling their services to business, are absolutely sure you are easily persuaded by their ads. This is why all of us are bombarded by advertisements. It’s why internet companies steal your information and sell it to marketers.
It is a central tenet of the modern economy, the tent pole that holds the whole thing up, that advertisements increase sales. All of the major global companies have big budgets for marketing. Those ad dollars support radio and television. Those ad dollars make modern sports entertainment possible. The internet, as it currently exists, is dependent upon the belief that ads alter consumer behavior. If the world suddenly stopped believing in the ad men, the world as we know it would change overnight.
The funny thing though, is advertisements have little impact on human behavior, at least not to the degree everyone assumes. If you see an ad for a new store opening in your area, that may cause you to check it out. Similarly, notices for an event in your area could get you out to the event. Awareness advertising, as the name implies, works, because it does a simple thing. It makes people aware of something they would otherwise not know or remember, like a new store or a special event.
Awareness ads are a tiny minority of advertising. Most ads are about specific products and services. There is always an awareness component to them, but for the most part the ads you see are intended to get you to buy product. Beer ads expect you to buy more beer of the type being advertised. Yet, not only is there no data to back up the assumption, the data says it has no effect on behavior. Here’s a study of ads for alcoholic products over the last forty years. Ads have no impact on sales.
Like democracy, the modern economy relies on people thinking important things are true, even though they are not true. If people realized their votes don’t count, then they would stop voting and resort of other means to change government. It’s why the charade of democracy is so profitable. Similarly, the modern economy relies on the fiction of human suggestibility. Marketing is a lucrative career, because the modern economy needs people to believe people are highly suggestible.
This is not to say that people are skeptics, of course. Fads have made a lot of people rich in the modern economy. A fad is just a commonly held belief that having or doing something increases one’s status or signals belonging to a group. Apple is a trillion dollar company, largely due to the ability of Steve Jobs to position his products as a bourgeois moral signifier. The iPod was not a great leap forward in technology. It was an example of the natural conformity within bourgeois society.
That is, of course, the perceived value of advertising. Global companies that spend their money reinforcing public perceptions about their brand. Dodge runs TV ads suggesting their customers are John Wayne from The Man Who Shot Liberty Valence. They are the indispensable, yet never appreciated foundation of society. Similarly, Apple marketed itself as the product for the distinguishing, carefree member of upper middle-class America, better that those proletarian zombies of the lower classes.
This may sound like a mark in favor of advertising, but the reality those public attitudes must exist for the ads to work. Every truck maker, even the Japanese makers, pitch themselves the same way. They are not creating a new identity group. They are attaching themselves to one that exists. Trucks were associated with working men long before the ad men thought of it. The term “Apple snob” was in circulation when Jobs was still in the wilderness, during his hiatus from the company.
Nevertheless, people believe advertising works, which is why Facebook is a gazillion dollar company. They sell your information to marketing firms and place targeted ads on their platform. The fact that no one looks at those ads or that the data Facebook sells is garbage is not important. People see the billion eyeballs on the site and believe that putting their product on the site will boost sales. They believe knowing the internet habits of those users will make for more persuasive advertising.
Steve Sailer, who started out in life doing quantitative research on marketing has written about this over the years. Before the internet existed, it was obvious to him that most marketing was a waste of money. Of course, there’s no money in telling people this, so there is not a lot of research done on advertising. It’s a good example of how belief is very powerful magic. Lots of people believe in advertising, so there is lots of money to be made in advertising. There’s no money to be made in debunking it.
That said, while most companies would be better off burning the cash they use for marketing and posting the video on YouTube, there are some forms of marketing that do work and are cost effective. The pitchman has been a staple of western society since the industrial revolution, because a good pitchman can move product. Whether it is the company sales team or the guy recommending product on his radio or TV show, these guys are an indispensable part of a modern economy.
That’s because people are persuadable, by only by other people. If someone you trust or someone whose judgement seems sound, recommends a product to you, you will consider it. Those radio guys pitching various items are monetizing the trust they have built up with their audience. There are limits to this form of marketing, but it is a cost effective way to identity a persuadable audience and have a trusted person recommend the product to that audience. It’s what marketing analytics pretends to be.
Despite the yawning gap in utility between the pitchman and the ad man, the former is considered low-class, while the latter is glamorous. Willy Loman is probably the most favorable portrayal of the salesman in popular culture. Usually, salesmen are viewed as creepy liars. In contrast, ad men are the slick, debonair types, living exciting lives in glamorous places like Manhattan. The TV series Madmen, relied heavily on this image to keep the audience. It looked cool to be an ad man in the 1960’s.
In reality, people in marketing are mostly shiftless sociopaths, while the people in sales are hardworking and honest. If you are ever evaluating a company for purchase, make sure to talk with the sales guys. They will tell you the truth about their bosses. Be prepared to put the marketing staff to sword. They will tell you whatever you need to hear to increase their budget by five percent next year. The most honest people in any company are the guys grinding through sales calls every day.
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