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Drop the opposition: Advertising benefits us all


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Don't overregulate the advertising industry, as it brings great benefits to the consumer

Banning and restricting advertising has little to no effect on overall consumption, but it does create negative consequences for consumers. Critics have exaggerated the influence adverts have on individual behaviour, with customers being far less susceptible to the influence of advertising than is often claimed. Restricting advertising on moral grounds ignores the benefit that it brings to consumers.

In a new version of Advertising in a Free Society – first published by the IEA in 1959 – Christopher Snowdon outlines the valuable role advertising plays in securing low prices and choice for individuals. The book debunks the myth that advertising is detrimental to society, assessing the various criticisms laid at its door.

Despite evidence to the contrary, advertising has long been condemned for breeding monopolies and manipulating the general public. In reality, advertising informs individuals and makes industries more competitive as companies aim to keep their existing customers whilst also attracting those of rival firms.

To attack advertising is to attack free speech. As a matter of principle, it is important to defend all forms of free speech, including commercial speech. Those with a deep moral aversion to advertising not only fail to see the benefit it brings to the individual, but wrongly equate aspiration for higher living standards with materialism or greed.

The new edition of Advertising in a Free Society includes an introduction that looks at six decades of economic evidence about advertising that has emerged since the original book was published.

Key misconceptions about advertising:

  • There is little evidence to suggest that advertising pushes up the cost of goods. Advertising enables companies to widen their market resulting in goods being bought at a considerably lower price. Publicising a product also informs customers about the available choices, reducing the time and cost incurred when researching a purchase.

  • Markets are made more competitive by the information provided to consumers via advertising. This is also true for markets dominated by a few large firms. For example, customers enjoy value for money and a wide range of options despite a small number of supermarkets leading the industry. Advertising means firms must work hard to keep existing customers while also attracting new ones.

  • Small firms can use advertising to their advantage, persuading the public to switch brands and sample alternatives. The existence of advertising therefore encourages brand disloyalty, making it easier for small businesses to break into the market.

  • No factual basis exists for the belief that advertising is manipulative. The intention of advertising is not to increase total demand but to retain existing customers while encouraging customers to switch to buying a firm’s products. The general public are not fools and advertising alone cannot coerce them to behave in a certain way.

  • Advertising is often the most efficient way to increase sales, contrary to the belief that it is a wasteful use of firm’s money. Ongoing failure to achieve higher profits would lead companies to use alternatives such as telesales and discount coupons in order to inform the public about a product. The widespread use of advertising is testament to its ability to improve sales.

Commenting on the research, Christopher Snowdon, Director of Lifestyle Economics at the Institute of Economic Affairs said:

“This new version of ‘Advertising in a Free Society’ is valuable reminder of the fundamental role advertising plays in society. Although the criticisms aimed towards it, which Ralph Harris and Arthur Seldon aimed to dispel over half a century ago, continue to gain support, policy makers and campaigners risk undermining our freedom if they continue this crusade against the advertising industry.”

“We should celebrate the fact that advertising empowers the everyday shopper, rather than undermining both businesses and consumers through constraining the industry.”

Notes to Editors:

To arrange an interview (live or pre-recorded) with an IEA spokesperson, please contact Camilla Goodwin, Communications Officer at [email protected] or call on 0207 799 8920/ 07821 971 443.

Advertising in a Free Society, by Christopher Snowdon, can be downloaded here.

Christopher Snowdon is Director of Lifestyle Economics at the Institute of Economic Affairs and an independent writer and researcher. He is the author of The Art of Suppression (2011), The Spirit Level Delusion (2010) and Velvet Glove, Iron Fist (2009). His work focuses on pleasure, prohibition and dodgy statistics. His blog is Velvet Glove, Iron Fist.

Ralph Harris was formerly Director General at the Institute of Economic Affairs and was instrumental in providing the ideas and intellectual entrepreneurship that sparked the ‘Thatcher revolution’ of the 1980’s.

Arthur Seldon was the Editorial Director at the Institute of Economic Affairs from the late 1950s until the later 1980s. At the IEA, he directed a publishing programme that included some of the world’s most eminent economists, including FA Hayek and Milton Friedman. Arthur Seldon was a prolific author and one of the most influential economists of the late twentieth century.

As with all IEA publications, the views expressed are those of the authors and not those of the Institute (which has no corporate view), its managing trustees, Academic Advisory Council or senior staff.

The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems.

The IEA is a registered educational charity and independent of all political parties.