MCOM 214 Study Guide - Midterm Guide: Puffery, Product Differentiation, Target Market
2 Oct 2018
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Advertising represents the intersection of two key disciplines: co(cid:373)(cid:373)u(cid:374)i(cid:272)atio(cid:374) ad(cid:448)ertisi(cid:374)g (cid:373)arketi(cid:374)g. Marketing is a process aimed to satisfying consumer needs profitable: product, price, place, promotion. Goal = to earn a profit for the firm. Self interest: people and organizations are acquisitive by nature, and purse their own self- interest. Complete information: all information about product availability, quality, prices is accessible for buyers and sellers. Many buyers and sellers: having many sellers ensures that customers will always have alternatives. Having many buyers means seller will find customers for their unique products. Absence of externalities (social costs): people who are not involved in a sell-buy transaction will not get harm/benefit from it. What are the functions of advertising in free-market economics. To include customers to try to products/suggest revenue. Effects on value of products: added value. Effect on prices: lower prices down in most cases.
