The importance of advertising is threefold: it helps consumers compare products and services, it allows businesses to retain existing customers and win new ones, and it educates society about important issues. By definition, advertising is an impersonal and unidirectional communication that flows from the advertiser to the consumer. Organizations pay to "place" it in one or more media venues, such as newspapers or television.
According to the Management Study Guide, advertising has four objectives. First, it attempts to get consumers to try a product or service for the first time. Ongoing advertising campaigns update existing customers on the product's benefits to encourage the customers to keep using the product. At the same time, the ads attempt to lure customers away from competitors' products. Finally, advertising tries to win back former customers who have switched brands.
Advertising comprises one part of an organization's marketing mix: the range of activities an organization uses to create mutually beneficial relationships with consumers. An effective ad is one that reaches as much of the target market as possible, holds the audience's attention, and successfully calls the consumer to take a specific action, such as calling for information or making a purchase.
If successful, an ad increases an organization's market share and solves a problem for the consumer.