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Advertising May Cost Companies Millions But… It’s Worth It!

September 19, 2012

Finding the perfect logo and slogan, choosing the most memorable company colors, and selecting the right people to endorse your product are all important components when creating an advertising/marketing campaign! Once you nail down these variables, advertising really does pay for itself!

Advertising is far from boring! Each year, worldwide over 500 billion dollars is spent on advertising. Much of that money is spent on advertising on TV. Television commercials generate millions, if not billions, of dollars in revenue for companies like Nike and Subway.

It has been shown in studies that many companies advertise products to children or make advertisements geared specifically around a younger demographic. Whether it’s car commercials mentioning space and safety for families, or credit card companies offering rewards like trips to Disney World, a strategy in adverting is market specifically to families. Even the strategic placement of advertisements for products like candy and toys are at eye level for children to see! Parents tend to make decisions based upon their children and companies have grown to understand that the more benefits they have for kids, the more families will buy the products they are promoting.

Being able to market and advertise a product is a reward by itself, but the amount of money it generates for your company is icing on the cake.

The perfect example of just how well marketing works for a company is Nike. Nike spends approximately 2 million dollars per year on advertising. That could be split between television commercials, online advertisements and even billboards. When it comes to athlete endorsements, Nike spends as much as 800 million dollars per year. That’s a ton of money for just one company to spend paying for advertising but the amount of revenue they generate each year far exceeds that number. On average, Nike makes over 17 billion dollars a year which is shown on the Nike, Inc. Website.

What is your favorite form of advertising? Would it be radio or television or even online advertisements? Let us know on our Facebook or Twitter pages.

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