The Press Thursday, September 22, 1927. The Economics of Advertising.

Press, Volume LXIII, Issue 19112, 22 September 1927, Page 8

The Press Thursday, September 22, 1927. The Economics of Advertising.

The lecture delivered in the Chamber of Commerce Hall last night by Mr Will Appleton was a deliberate attempt to persuade the business people of Christchurch that advertising pays. Just as deliberately our object in reporting and commenting on the address is to give Mr Appleton's arguments a wider publicity and emphasis. Mr Appleton lives on advertising, and so to a great extent does every newspaper. In the same way the farmer who grows good wheat, or the bootmaker who makes good boots, takes steps to let as many people as possible know what he has for sale. But there is this difference between trade in advertising and trade in wheat or boots that the buyer of space does not always realise what he is getting for his money. Advertising is a service and not a tangible commodity, and like | most services it is apt to be appreI ciated in proportion to the promptness i and measurableness of the result. No one requires to be told that advertising pays in special cases—the case, say, of "a trader who has surplus stock for j sale. But it is astonishing how many j people forget that the only kind of advertising which does not pay is stupidly untruthful advertising, or advertising placed in the wrong channels and conducted in the wrong way. Although everybody in business, and for that matter every householder, can thlnV of famous firms whose business has mysteriously died away, it is not generally understood that the mystery in at least one case in two, and probably two out of three, resplves itself into neglect of advertising, which is in plain words neglect of present and possible customers. It is, for example, known to everybody in the motor world that the maker of the most widely distributed of all cars, which might have been expected to be wellenough known to sell itself, found that as soon as he began to forget the publio, the public began to forget him, and in increasing numbers toj think of the admirably advertised car of his chief rival. And what is true of cars is true of every commodity with a world market—hats, pianos, soap, cocoa, whisky, pills. Some of our readers at least will remember that one of the best-known brands of cocoa, though it could not be obtained at all in most countries during the Great Wax,, was still advertised as freely as ever for fear—a very wise and proper fear—that its name would be forgotten, and people lose the habit of asking for it. Nor was that an example of waste in advertising, since there never | is waste in advertising when the final result is a vastly increased turnover. It is not even the case, as Mr Appleton clearly explained last night, that advertising adds to the price of goods. In every single case in which it is wisely placed and effectively directed, it lowers the cost of goods, as the introduction of more up-to-date machinery lowers their cost. Advertising is indeed part of the machinery of production, or should be, and has precisely the same relation to cost as have improved methods and more highly specialised plant. It was, for example, pointed out last night, on very high authority, that England spends p, hundred million pounds a year on newspaper advertising, and America more than three times as much; but instead of these huge sums being a tax on British and American consumers, they are almost a gratuity or bonus, since they represent a vastly increased turnover and incredibly greater efficiency in production than would be possible if there were no newspapers in. which to advertise. It must also be'obvious enough to newspaper readers that even if advertising in itself had no nftws value, it is advertising, and nothing Jjut advertising, which enables newspapers to give their readers twelve or twenty times as costly a journal as, they pay for. That, however,\ is ofte of the happy accidents of advertising rather than its prime purpose and object. Its chief end is to energise all the processes of production, disr tribution, and exchange, and it fails only when, like any other delicate and costly instrument, it is directed without intelligence.