How Far Are Selling Costs Efficacious?
Advertisement is a very delicate weapon and it is impossible 10 assess its value. First, it is difficult to generalise, The same expense on advertising may yield a handsome dividend when incurred in a certain manner or under certain circumstances and may prove utterly barren otherwise. This is due to the fact that its success depends almost entirely on its appeal to uniqueness or novelty. When this element is missing. advertisement is a waste.
there is no relation between the seller and the volume of business secured by a finn. Thrill)’. since advertisement evokes counter-crustacean, selling costs are influenced very much by what the naval. businessmen are doing. This competitive advertisement may cat up the plot so that none may benefit except the adverse I fourthly the octopus from selling may accrue lIut only to the firm incurring them hut also to it\ rivals. An advertisement by New India Insurance Company may prepare a person for insurance but he may go in for a policy in the Oriental Insurance Company instead advertisement is based on the assumption that a large number of customers are prepared to change their preferences. This may not be the case. Resistance comes from the force of habit. It is not possible to find out how much of the business is due to repeat customers and how much to new customers won by advertisement. In the former case. selling costs should be treated as fixed costs and in the latter. variable costs. Full costs of advertisement should be charged 10 new business.
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