advertising amanda petrilli and amanda sobers. do companies make more money if they spend more on...

Advertising

Amanda Petrilli and Amanda Sobers

Do companies make more money if they spend more on advertising?

• Advertisement persuasiveness• What the consumer ends up spending their money on

• Most popular ads• Where ads are seen the most

Where did your data come from?

Primary Data:

Forty students from grades

9 to12 were surveyed andwe wanted to find out:

• What advertisements were seen most

• Where advertisements are seen

• How frequently certain advertisements are viewed

• Effectiveness of different types of ads

• Where the majority of the survey taker spends their money

Where did your data come from?

Secondary Data:

We researched companies in our four different

categories of ads; fast food, electronics, cosmetics and

clothing.

• McDonald’s• Apple Inc.

• L’Oréal• Nike

Researched in order to find out how much money the

companies spend on advertising and if increased

spending results in increased profits.

Which advertisements do you hear/see the most?

Seen most: Fast food

Second: Electronics

Third: Cosmetics

Last: Clothing

McDonald’s

Annual Revenue: $22.8 billion

Annual advertising budget: 15% of revenue (roughly $3.3 billion)

Are advertisements with celebrities more effective than ones without?

Results were almost evenly distributed; 57% said yes, 43% said no.

McDonald’s vs. NikeAdvertising budget: $3.3 billion $2.5 billionRevenues: $22.8 billion $ 19.2 billion

Where do you see/hear the most advertisements?

• Majority see ads from television

• Internet ads are seen second most

• Magazine/billboard and Radio ads are tied for third

Do you tend to pay attention to lower budget ads?

• As expected, the majority said no.• Lower budget ads have lower picture quality, mediocre actors• Possibly unreliable

Are infomercials effective or annoying?/ Do you or your parents buy products from infomercials?

The majority agreed thatinfomercials are annoying andmany do not buy products fromInfomercials

Infomercials are typically• Loud• Repetitive• Long• Misleading• Have hidden costs

Conclusion

• Advertisements play a major role in a company’s ability to make money

• Each researched company’s revenue in the billions, advertising about 10-15% of this

• More advertising does result in higher profits-------------------------------------------------------------------------------------------------Company Info:

L’Oréal McDonald’sAnnual revenue: $23 billion Annual revenue: $22.8 billionAdvertising expenditures: $6.29 billion Advertising expenditures: $3.3 billion

Apple Inc. Nike

Annual revenue: $32.5 billion Annual revenue: $19.2 billionAdvertising expenditures: $500 million Advertising expenditures: $2.5 billion