The Amount of the Advertising Appropriation

The Amount of the Advertising Appropriation

The Amount of the Advertising Appropriation

We have said that advertising alone does not sell goods. It merely creates an interest which subsequently must be converted into a demand by other ONLINE MARKETING methods. The amount of money one has to spend on advertising, however, will influence one's distribution policy because there are certain distribution channels which rely more heavily on advertising support than others.

When a product is marketed via the wholesaler, heavy promotional advertising may be unnecessary. Indeed, many wholesale houses prefer to buy unbranded merchandise to which they can apply their own brand names. In this instance it is the wholesaler and not the manufacturer who meets the cost of advertising and promotion.

In an earlier webpage it was emphasized that retailers are conscious of the importance of national advertising in contributing to the sale of branded goods. They will give greater prominence to and venture bigger stocks of those items of merchandise for which they know that consumer interest will be promoted by the manufacturer's advertising programme. As a result, the product manufacturer with limited resources to devote to consumer advertising may find resistance on the part of retailers either to stock or to promote the sale of his products. He is left with the choice of distribution via the wholesaler or going direct to the consumer. If his product appeals to a limited rather than a general or 'popular' market, it may not be suitable for wholesale distribution. The wholesaler is interested chiefly in lines which he can sell to his regular retailer outlets. Thus, the specialized product manufacturer, with limited means for advertising, may find himself compelled to make a direct-to consumer approach. Providing his product has a reasonably long profit margin, he may find his best distribution channel is mail order where his limited advertising appropriation may create adequate interest in the special market segment he wishes to penetrate. Alternatively, some form of house-to-house selling may be suitable.


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