Henderson daily dispatch., 1940-03-20
ADVERTISING REDUCES PRICES
Jacksonville, (Fia.) Times Union

Not only does advertising have the
effect Of reducing the price OF radios
rs WAS explained in these columns
= few days ago in 4 conversation
between Ivan, the Russian commlln-
ist who diSlikes the American way
of doing things, and the satisfied
American worker: it lowers the cost
ot cameras. cook stoves, gas ana
electric ranges, refrigerators, Daoy
carriages. baby shoes. and everything
else the American people need and
enjoy.
The camera IS used by the Bureau
of Research and Education to Illus
trate the effect OF advertising. 1t
WAS advertised extensively, sales IN
creased and overhead costs were re-
duced. Now, with larger production,
the manufacturer is able 10 operate
more economically and to sell 4 bet
fer camera for SIS than was sold
ten wears ago for $50. The adverlS-
inc cost, however, is only 10 cents
tor each camera. which makes the
saving 10 the customer 9lo. Inc
Bureau says:
in similar way, advertising has
helped to lower prices IN many other
Specific cases. Yet there seems to be
common impression that advertising
represents an extra cost, something
that must be added TO the price Of
what YOU buy.
Everybody knows that advertiS-
ins costs money and that it is used
to help sell goods. Less Known is the
fact that advertising sells goods so
we'll that it is the cheapest way ol
selling them. This is one Of the
reasons why it is possible to sell
well-advertiSed goods at a lower
price than if they were not advertiS-
ed.
Then there is the other important
reason. AS advertising builds the
sales volume Oh 4 company laSter
and greater than any other method,
1t makes large-Scale manufacturing
possible, ana that reduces the cost
oI making each article. When there IS
which there usually Is,
and dealers lower
their prices as rapidly as they can.
IL this way, consumers get the bene-
tit OF the SAVINGS that advertising
effects in the costs OF selling ana
manufacturing.
When you see thousands Of dol
arS spent for a single advertisement,
lave to pay for it when you buy
he advertised articles. But few peo-
Die realize how little this cost really
5 when spread over the large numoer
ii units sold through the acvertiS-
nent ana how large a saving this
makes IN the total cost. On Canned
goods, the average cost Of advertis~
ng is less than One-half cent per
an. On one OF the most widely adj
:ertiSed soft drinks the advertising
:oSt is less than one-fiftieth of d
,ent per glass.
Jumping together all the adver-
Using II the country, the total en-
amount to less than two
ser cent of the value of all goods
sold. This is very small in COMPARE
son with other selling and distribut-
ng costs. The Department OF Com
nerce estimates that in 1885 the
:oal cost of distribution was % per
cent. So it appears that the total
amount spent for advertising is only
one-fourteenth Of the whole cost of
II no money were spent for adver-
Using. however. the cost of selling
and distributing would be far higher
than it is now, and prices would
nave to be higher, the Bureau finds.
More important still, a smaller
:olume Of goods would be sold and
produced and there would be less
and a smaller share of
he worlds goods for each Of us"
Picture the world without the
benefits Of the work of scientists and
and without advertised
fondS'