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"commercial advertising is fundamentally an effort to undermine markets". - Chomsky

by pvdm 13y ago

anigbrowl 13y ago
Zzzz. Advertising is an element of monopolistic competition between goods that are imperfect substitutes for each other. Perfect competition can exist only in markets for fungible products. I mean, I'm no fan of advertising, but what does St. Noam expect - that manufacturers should abstain from advocacy of their own products? Of course bigger ones spend more money on advertising - but then they also invest more heavily in stock and production lines, and have a correspondingly greater need to recover their investment. By this logic, musicians should be required to wear uniforms and perform in the dark, since all that visual spectacle is just an effort to undermine listeners' acoustic perceptions.
- throwaway2048 13y ago
  Hes not stating anything of the sort, and you just built a ridiculous strawman. He is simply warning of the nature of advertisement, and the moral hazard inherent to it. Being aware of stuff like this is real empowerment.
  - anigbrowl 13y ago
    Yes he is. He says advertising is an attempt to undermine markets; there's an implicit corollary that markets operate more efficiently absent any advertising. Perfect competition and monopolistic competition are terms with specific meanings in economics, and Chomsky is asserting that they are isomorphic, which is not the case. I'm simply pointing out the absurdity of his argument by applying it to a market for goods that are not fungible - the work of competing musical artists, whose output is not easily substitutable for that of their competitors. Being aware of stuff like this is, in my view, even more empowering. The idea that advertising panders to its readers in order to shift their preferences is so obvious as to be trite. In fact, Chomsky's habit of doing this to his own readers is one reason that I dislike him so intensely. I suggest you try Marshall McLuhan's Understanding Media as a contrast to Chomsky's brand of polemic.
    - ordinary 13y ago
      You've either misinterpreted the quote (stripped from its context as it was) or I'm misunderstanding your point. Here is that context: In fact quite generally, commercial advertising is fundamentally an effort to undermine markets. We should recognize that. If you've taken an economics course, you know that markets are supposed to be based on informed consumers making rational choices. You take a look at the first ad you see on television and ask yourself... is that its purpose? No it's not. It's to create uninformed consumers making irrational choices. The full interview can be found here, though I think the above passage is sufficient: http://www.alternet.org/civil-liberties/noam-chomsky-kind-anarchism-i-believe-and-whats-wrong-libertarians http://www.alternet.org/civil-liberties/noam-chomsky-kind-an... (The quote appears at the top of the fourth page. Presumably, the interview is paged to create more room for advertisements. That's irony for you.) Which of the two is it?
      - anigbrowl 13y ago
        I guess I'm not communicating my point well. Thanks for providing the pexapnded verison of the quote. What I disagree with is this: It's to create uninformed consumers making irrational choices. That's true when advertisers lie to consumers, which is often the case. But there's lots of advertising that just consists of 'Our product has features XYZ, and does (whatever it is) really well. We think you'll love it, so please go to the store and buy it right now.' Chomsky's not saying 'oh, you better take adverts with a big pinch of salt because advertisers often exaggerate or try to appeal to emotions like fear, lust and greed.' If he said that I'd agree with him, that's absolutely true and it's something I find offensive about a lot of adverts. But he's making a wild claim that all advertising functions that way, disregarding perfectly valid uses of advertising that are informative to the consumer. I dunno, maybe Noam Chomsky thinks manufacturers (or whoever) should just submit their products to some institutional equivalent of Consumer Reports without comment, and then everyone could decide what to buy based on the findings of independent assessors. But as I tried to show above with my example of musicians, consumers' tastes are subjective to a large degree, and this is especially true for products that are not fungible. So where it's true, I'm happy to agree with him. Take bottled water, for example - 99% of advertising claims made there are total bullshit, and you'd be better off buying a good shatterproof bottle and filling it from your tap or a filter jug than buying a bottle of water in a store. Some water, like Dasani, isn't even sold as spring water, it's just the water supplied to the same bottling plant where they make Coca-cola. They're selling it on the basis of having a nice-looking bottle and whatever pleasant bit of music they put into commercials showing attractive people having fun, in hopes that consumers will identify with that and pick Dasani next time they're thirsty for some water. But that's not the entirety of advertising by a long shot. I work in the film industry, so I look at a lot of ads for things like cameras, pro audio gear and so on. Those communications have a lot of value for me, and while I may discount that value based on the style of the communication (are you showing me a camera, or trying to make me feel like this camera will turn me into a successful photographer?), it's not making me less informed. Nor is the monthly advertisement I get from the local supermarket chain telling me what new products they have on the shelves and why I might wish to buy them - they're on sale, or in season, or now available frozen or whatever. Chomsky treats all advertising as mendacious, ignoring the entirely legitimate purpose of merchants announcing the goods they have to sell. BTW I don't work in adverts or marketing or anything related to that. I just have strong opinions about this topic because I was thinking through these issues for myself long before I ever heard of Noam Chomsky, and when I did come to read him I was disappointed at how frequently he set off my bullshit detectors.
- md224 13y ago
  > Of course bigger ones spend more money on advertising - but then they also invest more heavily in stock and production lines, and have a correspondingly greater need to recover their investment. Not sure I follow the logic here, but I don't know much about economics. Your logic seems to be... big companies that spend a lot of money need to make a lot of money to cover their expenses, so it's okay for them to be able to advertise more heavily than smaller companies, since they need to sell more stuff? Is that the argument?
  - anigbrowl 13y ago
    Close. I'm not saying 'it's OK' but rather than they have a strong economic incentive to do so. Suppose, for example, that company A has revenues of $50m/year, and launches new product at a cost of $10m each year. Company B is a boutique manufacturer in the same market that pulls in $2m a year and spends $500k to launch a new product every 3 years. If they both spend 5% of their launch budget on advertising, Company A will be buying an awful lot more ads, and probably getting them at a lower price per impression.
csense 13y ago
In real markets, every person is not aware of every product. While marketing can be used to push inferior products, it can also be used to raise awareness of superior products. You could also view advertising as a way of adding intangible value to products. I.e., maybe the warm fuzzy feelings Apple fans get from supporting their favorite company constitute extra utility that would not have been created without Apple's marketing and branding efforts. I agree that sometimes marketing leads to outcomes that are economically inefficient, but saying all or most advertising falls in this category is a much tougher sale.

"commercial advertising is fundamentally an effort to undermine markets". - Chomsky

by pvdm 13y ago

"commercial advertising is fundamentally an effort to undermine markets". - Chomsky

Zzzz. Advertising is an element of monopolistic competition between goods that are imperfect substitutes for each other. Perfect competition can exist only in markets for fungible products. I mean, I'm no fan of advertising, but what does St. Noam expect - that manufacturers should abstain from advocacy of their own products? Of course bigger ones spend more money on advertising - but then they also invest more heavily in stock and production lines, and have a correspondingly greater need to recover their investment. By this logic, musicians should be required to wear uniforms and perform in the dark, since all that visual spectacle is just an effort to undermine listeners' acoustic perceptions.

throwaway2048 13y ago
Hes not stating anything of the sort, and you just built a ridiculous strawman. He is simply warning of the nature of advertisement, and the moral hazard inherent to it. Being aware of stuff like this is real empowerment.
- anigbrowl 13y ago
  Yes he is. He says advertising is an attempt to undermine markets; there's an implicit corollary that markets operate more efficiently absent any advertising. Perfect competition and monopolistic competition are terms with specific meanings in economics, and Chomsky is asserting that they are isomorphic, which is not the case. I'm simply pointing out the absurdity of his argument by applying it to a market for goods that are not fungible - the work of competing musical artists, whose output is not easily substitutable for that of their competitors. Being aware of stuff like this is, in my view, even more empowering. The idea that advertising panders to its readers in order to shift their preferences is so obvious as to be trite. In fact, Chomsky's habit of doing this to his own readers is one reason that I dislike him so intensely. I suggest you try Marshall McLuhan's Understanding Media as a contrast to Chomsky's brand of polemic.
  - ordinary 13y ago
    You've either misinterpreted the quote (stripped from its context as it was) or I'm misunderstanding your point. Here is that context: In fact quite generally, commercial advertising is fundamentally an effort to undermine markets. We should recognize that. If you've taken an economics course, you know that markets are supposed to be based on informed consumers making rational choices. You take a look at the first ad you see on television and ask yourself... is that its purpose? No it's not. It's to create uninformed consumers making irrational choices. The full interview can be found here, though I think the above passage is sufficient: http://www.alternet.org/civil-liberties/noam-chomsky-kind-anarchism-i-believe-and-whats-wrong-libertarians http://www.alternet.org/civil-liberties/noam-chomsky-kind-an... (The quote appears at the top of the fourth page. Presumably, the interview is paged to create more room for advertisements. That's irony for you.) Which of the two is it?
    - anigbrowl 13y ago
      I guess I'm not communicating my point well. Thanks for providing the pexapnded verison of the quote. What I disagree with is this: It's to create uninformed consumers making irrational choices. That's true when advertisers lie to consumers, which is often the case. But there's lots of advertising that just consists of 'Our product has features XYZ, and does (whatever it is) really well. We think you'll love it, so please go to the store and buy it right now.' Chomsky's not saying 'oh, you better take adverts with a big pinch of salt because advertisers often exaggerate or try to appeal to emotions like fear, lust and greed.' If he said that I'd agree with him, that's absolutely true and it's something I find offensive about a lot of adverts. But he's making a wild claim that all advertising functions that way, disregarding perfectly valid uses of advertising that are informative to the consumer. I dunno, maybe Noam Chomsky thinks manufacturers (or whoever) should just submit their products to some institutional equivalent of Consumer Reports without comment, and then everyone could decide what to buy based on the findings of independent assessors. But as I tried to show above with my example of musicians, consumers' tastes are subjective to a large degree, and this is especially true for products that are not fungible. So where it's true, I'm happy to agree with him. Take bottled water, for example - 99% of advertising claims made there are total bullshit, and you'd be better off buying a good shatterproof bottle and filling it from your tap or a filter jug than buying a bottle of water in a store. Some water, like Dasani, isn't even sold as spring water, it's just the water supplied to the same bottling plant where they make Coca-cola. They're selling it on the basis of having a nice-looking bottle and whatever pleasant bit of music they put into commercials showing attractive people having fun, in hopes that consumers will identify with that and pick Dasani next time they're thirsty for some water. But that's not the entirety of advertising by a long shot. I work in the film industry, so I look at a lot of ads for things like cameras, pro audio gear and so on. Those communications have a lot of value for me, and while I may discount that value based on the style of the communication (are you showing me a camera, or trying to make me feel like this camera will turn me into a successful photographer?), it's not making me less informed. Nor is the monthly advertisement I get from the local supermarket chain telling me what new products they have on the shelves and why I might wish to buy them - they're on sale, or in season, or now available frozen or whatever. Chomsky treats all advertising as mendacious, ignoring the entirely legitimate purpose of merchants announcing the goods they have to sell. BTW I don't work in adverts or marketing or anything related to that. I just have strong opinions about this topic because I was thinking through these issues for myself long before I ever heard of Noam Chomsky, and when I did come to read him I was disappointed at how frequently he set off my bullshit detectors.
md224 13y ago
> Of course bigger ones spend more money on advertising - but then they also invest more heavily in stock and production lines, and have a correspondingly greater need to recover their investment. Not sure I follow the logic here, but I don't know much about economics. Your logic seems to be... big companies that spend a lot of money need to make a lot of money to cover their expenses, so it's okay for them to be able to advertise more heavily than smaller companies, since they need to sell more stuff? Is that the argument?
- anigbrowl 13y ago
  Close. I'm not saying 'it's OK' but rather than they have a strong economic incentive to do so. Suppose, for example, that company A has revenues of $50m/year, and launches new product at a cost of $10m each year. Company B is a boutique manufacturer in the same market that pulls in $2m a year and spends $500k to launch a new product every 3 years. If they both spend 5% of their launch budget on advertising, Company A will be buying an awful lot more ads, and probably getting them at a lower price per impression.

csense 13y ago

In real markets, every person is not aware of every product. While marketing can be used to push inferior products, it can also be used to raise awareness of superior products. You could also view advertising as a way of adding intangible value to products. I.e., maybe the warm fuzzy feelings Apple fans get from supporting their favorite company constitute extra utility that would not have been created without Apple's marketing and branding efforts. I agree that sometimes marketing leads to outcomes that are economically inefficient, but saying all or most advertising falls in this category is a much tougher sale.