香蕉视频

Back in the 1980s, when working on legal briefs related to various facets of advertising (later summarized in Rivalry, Cambridge University Press), I found the following information:

80 percent of all consumer choices were rooted in someone's personal recommendation;

in changes of opinion regarding brands and household products, 38 percent included personal influence; for 15 percent of the cases this was judged to be the most important factor;

although mass media exposure was very high, the effectiveness of this exposure was relatively low.

A 1983 Whirlpool study asked people to identify their most reliable source of product information.聽 Twenrty-three percent of responders answered "friends" (in the traditional, not the Facebook, meaning of the word); 15 percent said relatives; only 6 percent listed advertising.

What would these BG (Before Google) and BF (Before Facebook) era advertising numbers imply about these companies' relative valuation?

Google's main source of revenue by far remains advertising, which makes sense. Advertising either gives information about new products and services, or reminds you of existing ones.聽聽 How would people otherwise know or be reminded of their existence?聽 They would have to search for such information, which is time consuming.

Most formal advertising, be it for toothpaste, paper towels, fast food, or cars, is the "remember-its-existence" type.聽 People do not care much whether they are buying Crest or Colgate, or one paper towel or another.聽 They casually flip between substitutes because of very small price advantages or of marginal events like last minute reminders.

Reuven Brenner holds the Repap Chair at 香蕉视频's Desautels Faculty of Management.

Read full article: , February 3, 2011