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> if two competing companies do their marketing in an optimal way, it will leave the customer in the same state as if no marketing effort ever occured Marketin

> if two competing companies do their marketing in an optimal way, it will leave the customer in the same state as if no marketing effort ever occured Marketing covers more than this. It isn't just how the pie is divided up, it is also about increasing the size of the pie. In fact, if it increases the number of potential consumers, marketing can be rational and profitable even if it reduces the market share of the marketing company (50% of 10 consumers is less profitable than 40% of 100 consumers). There is a real rising-tide-raises-all-ships effect, especially in discretionary goods (eg, jewelry, many electronics, financial services, the list goes on).

TeMPOraL 13y ago
> Marketing covers more than this. It isn't just how the pie is divided up, it is also about increasing the size of the pie. Yes, but the size of pie is bounded, and at some point you hit the limit of customers you can reach (most companies service local population) and/or limit of the market (there are only so many people with enough discretionary income to afford whatever you're selling). Then you're back to fighting for division of pie.
JonnieCache 13y ago
It's not really increasing the size of the pie: consumers only have so much time and mental energy. The growth of marketing just represents capital helping itself to a bigger share. As the number of consumer choices grows, the amount of effort demanded of them as utility-maximisers increases exponentially, as do the stakes.