Economic Aspects Of Advertising In Agriculture: A Review

In a dynamic world of change, promotion of agricultural commodities will inevitably become more important, particularly with respect to intensification in the nature of competition, the complexity in distribution and differences between consumer and producer prices. The impact of advertising as a means of promoting agricultural commodities, have to be evaluated in terms of consumer response and the effectiveness of advertising agricultural products, by assuming that advertising can increase the level of sales at any given price by shifting the demand curve for a specific product to the right, or increase the price or both. Although South Africa is a part of Africa, it has a highly developed and sophisticated marketing structure which necessitates the analysis and decomposition of foreign advertising research done in Europe and America for possible application in South Africa, due to the virtually non-existence of research on generic or brand advertising of agricultural products in South Africa. Empirical research on the effects of advertising generally indicates a positive effect on sales that continues beyond the time of initial advertising. Most analyses considering the effect of advertising on consumer demand for agricultural commodities have pragmatically focused on single-equation demand relations using aggregate data. However, limitations of the single equation approach exists. In general, empirical evidence shows that brand advertising is more efficient than generic advertising.