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Advertising

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The Palgrave Encyclopedia of Strategic Management

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Abstract

The following is an overview of advertising and its impact on markets and society. In general, advertising is one-way communication that is designed and transmitted by a sender to a receiver. The objective of the sender is to affect a decision that the receiver will make and this decision relates to issues which have direct impact on the sender. Advertising is observed to have two important roles. The first is creating awareness of the sender in terms of both recall and recognition. The second is to provide the receiver with detailed information that enhances her understanding of the situation. In markets, advertising can make prices go up or go down and for this reason there is significant controversy regarding the manner in which advertising works and its overall impact on society. There are models that reconcile these seemingly contradictory views of advertising. Nevertheless, the one-sided nature of advertising messages and advertising clutter limit advertising’s effectiveness. A trend of reduced impact is likely to increase over time.

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Author information

Authors and Affiliations

  1. Rotman School of Management, 105 St George Street, M5S 3E6, Toronto, ON, Canada

    David Soberman

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  1. David Soberman
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Correspondence to David Soberman .

Editor information

Editors and Affiliations

  1. Stanford University , Stanford, California, USA

    Mie Augier

  2. Tusher Ctr Intellectual Capital, University of California Tusher Ctr Intellectual Capital, Berkeley, California, USA

    David J. Teece

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Soberman, D. (2016). Advertising. In: Augier, M., Teece, D. (eds) The Palgrave Encyclopedia of Strategic Management. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-94848-2_454-1

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  • DOI: https://doi.org/10.1057/978-1-349-94848-2_454-1

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  • Publisher Name: Palgrave Macmillan, London

  • Online ISBN: 978-1-349-94848-2

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