Advertising in relation to markets Producers must think about many things when they decide how to promote their products. Of course at the top of the list are the determinants of demand and supply and elasticity.

What must they consider?  Why would a producer think about determinants of demand when creating an advertisement?  Supply?  Elasticity of Demand?  Supply?  Why would a producer think about determinants of demand when creating an advertisement?  Supply?  Elasticity of Demand?  Supply?

Advertising  Producer’s goal?  How do they do it?  Is advertising sometimes misleading?  Can you come up with examples of misleading advertising you have seen?  Producer’s goal?  How do they do it?  Is advertising sometimes misleading?  Can you come up with examples of misleading advertising you have seen?

BEWARE….  Misleading Advertising  Free gift, compare at $75, 2 for 1,  Puffery: “all new,” “jumbo,” “25% more,” “super strength,” “reduced fat,” “improved”  Unfair Sales Techniques  Trading up: when you say you want a dvd player, looking to spend about $300 and the first one they show you is $500  Provide incomplete or misleading information  Pressure for immediate sale  Misleading Advertising  Free gift, compare at $75, 2 for 1,  Puffery: “all new,” “jumbo,” “25% more,” “super strength,” “reduced fat,” “improved”  Unfair Sales Techniques  Trading up: when you say you want a dvd player, looking to spend about $300 and the first one they show you is $500  Provide incomplete or misleading information  Pressure for immediate sale

BEWARE…  Fraudulent Practices  Selling used as new  Bait n Switch: When a store advertises a great price for a product, so you show up to buy it….but they just happen to be all out of those…then they say “but here is a great substitute” of course for more money!  Fraudulent Practices  Selling used as new  Bait n Switch: When a store advertises a great price for a product, so you show up to buy it….but they just happen to be all out of those…then they say “but here is a great substitute” of course for more money!

Who gets “caught” by these gimmicks???  Protect yourself!  Know what you want before going into store  Take your time when deciding  Think for yourself  Make your own comparisons  Be aware of advertising tactics!  Protect yourself!  Know what you want before going into store  Take your time when deciding  Think for yourself  Make your own comparisons  Be aware of advertising tactics!

Assignment:  By next class, go to a store and find as many examples of misleading advertising, unfair sales techniques, and fraudulent practices. Write them down so you remember and can share, or take a picture of them to share.  In a group of 2-3, create a real looking advertisement (newspaper ad, magazine ad, commercial, billboard layout, etc). Include some sort of misleading advertising in it, but try to make it real, not obvious. Also consider demand and supply, as well as elasticity when considering pricing strategies and content.  By next class, go to a store and find as many examples of misleading advertising, unfair sales techniques, and fraudulent practices. Write them down so you remember and can share, or take a picture of them to share.  In a group of 2-3, create a real looking advertisement (newspaper ad, magazine ad, commercial, billboard layout, etc). Include some sort of misleading advertising in it, but try to make it real, not obvious. Also consider demand and supply, as well as elasticity when considering pricing strategies and content.

Advertisement requirements  Creating an advertisement  Today you get to think like a producer and create an advertisement for any product or service you like. The advertisement can be in any of the following forms: magazine ad, newspaper ad, commercial, infomercial).  Requirements:  Full group participation  The advertisement should be of a quality that could be real (meaning significant effort should be put forth)  You must think about the misleading advertising strategies, determinants of demand and supply, and elasticity of your product as you create it (you will be asked to analyze your advertisement later based on these concepts).  Creating an advertisement  Today you get to think like a producer and create an advertisement for any product or service you like. The advertisement can be in any of the following forms: magazine ad, newspaper ad, commercial, infomercial).  Requirements:  Full group participation  The advertisement should be of a quality that could be real (meaning significant effort should be put forth)  You must think about the misleading advertising strategies, determinants of demand and supply, and elasticity of your product as you create it (you will be asked to analyze your advertisement later based on these concepts).