The Informational Content of Advertising

The economic effects of advertising lead to a better understanding of why to advertise but give less direction on the question of what kind of advertising to employ. The content of advertising messages shifts dramatically depending on whether their function is to inform consumers about price, product quality, and product uses (as in informative advertising), or whether it is designed to shift consumer tastes (as in persuasive advertising). Informative advertising can include a description or a picture of the product, whereas persuasive advertising tries to portray the act of using a product as popular and desirable based on factors unrelated to the product itself. The distinction between informative and persuasive advertising, however, is somewhat arbitrary, because a persuasive advertisement about a product—"using a multimedia computer is cool!," for example—may be informative to those searching for a "cool" computer.

Advertising content also varies with the type of product. For goods whose quality can be learned before consuming (search goods), advertising tends to be informative. A picture or a description of a product tells customers the necessary information. Other products must be consumed before their quality is known (experience goods), such as automobiles, household appliances, and computer programs. Some products are simply too complicated for consumers to understand and evaluate the quality. For these products, even detailed product information is not enough to resolve the uncertainty about the product. For this reason, advertising for experience goods tends to be more persuasive than informative. Although both informative and persuasive advertising can be provided for experience goods, it is often better to use other promotional methods than advertising, such as free trials, warranties, and so forth.