Business Economics

Business Economics

Advertising is a form of communication, which is used by companies and organization to inform the consumers about a certain product, or service, which is being offered by the companies. Additionally, it is a form of communication through which the seller informs the buyer about his commodities (Brux, 2007). This method of communication has been widely used by different companies as a way of winning the hearts of the consumer in order to increase their profit margins. In addition, it is another way of making the consumers aware of the brands of different commodities. Advertising has been tested to be very profitable for different firms but on the other hand, it has been known to harm the consumer economically.

One of the ways in which advertising harms the consumer is the lack of provision of some information, which is very vital to the consumer. Many companies while advertising fail to reveal certain disadvantages of the products therefore, misleading the consumer into buying the product. This may affect the consumer economically because if he buys a commodity in the stores after it was advertised later to realize that the product will not help, it will be a big loss to the customer. Instead of using that money in buying the correct commodity, it has led in harming the consumer economically because he has lost his money in buying the useless commodity. However, the company has made a profit from the sale of the commodity while the consumer mourns.

Another way in which consumers have been harmed economically is in the cost of advertising. When companies are advertising, they usually calculate the costs of advertising and increase in the price of the commodities. When these prices are being reflected in the commodities, the person who pays for the commodities also pays for the costs of advertising. The consumer being the buyer is usually left with the burden of paying for the advertising cost making it very difficult for the consumer. The companies will continue to get their profits as the consumer is being harmed economically when he pays that extra dollar for the advertisement of the commodity. Therefore, the consumer ends ups losing his money.

Another problem is when the companies distort their information so that they can win the hearts of the consumer. Many companies can do any thing so that they can win the hearts of the consumers. The companies have gone ahead to the extent of distorting the information to convince as many customers as possible. Depending on the information the customer sees from the different advertisements he or she is likely to buy the commodity in accordance with his or her specification and what he or she has seen. Later, the consumer realizes that what he or she bought is useless or is not to his or her specification. This leads to the consumer losing his or her money due to the distortion of information in which the advertisement was based on. Therefore, the company distorting the information will continue in making profits while the consumer continues to be harmed economically.

Many of the products, which have been continually produced by the different consumers, usually have defects of their own especially medicinal drugs. In the recent past, many companies were using different celebrities to state how a certain drug helped him recover from a certain illness (Huskamp, Donohue, Koss, Berndt and Frank, 2008). This usually leads to many customers who are being affected by the same ailment as the celebrity buying the drug. However, what the consumers do not recognize is that the celebrity may have been diagnosed differently. This makes the consumer to suffer because when they take this medicine, they maybe infected with another disease, which later harms him or her more than he or she thinks. The consumer will end up paying more than what he or she could have had when going for the various treatments of the diseases.

The youth and teenagers are another target group, which most of the companies utilize in marketing their products. The companies are taking them as the potential buyers of their commodities because they influence the purchasing power of their parents. Very many children in many families usually get what they want. The companies have gone further to influence the decision of the teenagers when it comes to buying these commodities because they are unable to critically think for themselves. These teenagers and the youth will end up buying either goods, which are of low standards or goods that they do not need. The parent will be the end loser and eventually he will be harmed economically as the companies continue to get more and more profits.

There are very many methods of advertising, which the different companies use. One method of advertising is through the sale of these commodities. Many companies instead of decreasing the prices of the products increase them (Avery, Kenkel, Lillard & Mathios, 2006). What they only do is that they decrease those commodities they know are unwanted and increase those commodities, which are in demand. This is a form of misleading where the customer will buy the commodity at a higher price than it was leading to the company making more than it is required while on the other hand harming the consumer economically.

In conclusion, many companies are coming with very many techniques of advertising. What they only care about is the profits in which they are making and trying to improve their customer base. This has led to many consumers being affected economically and other ways. Additionally, the government has been very lenient to this advertisement therefore, exposing the consumer to various risks. This means that the consumer is left alone to suffer while the companies benefit. Therefore, the different consumers are told to be aware of the different tactics the companies are using. Before buying a commodity, they should enquire first from those people who have bought and used the commodities for feedback. In conjunction, they should also ask of any other terms, which might be involved in the purchase contract before they purchase. This will help in solving the economic effects, which harm the consumer.



Avery, R. J., Kenkel, D. S., Lillard, D. R., & Mathios, A. D. (2006). Regulating advertisements: The case of smoking cessation products. Cambridge, Mass: National Bureau of Economic Research.

Brux, J. M. (2007). Economic Issues & Policy. Florence, KY: Cengage Learning.

Huskamp, H., Donohue, J., Koss, C., Berndt, E., & Frank, R. (December 11, 2008). Generic Entry, Reformulations and Promotion of SSRIs in the US. Pharmacoeconomics, 26, 7, 603-616.

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