r/explainlikeimfive • u/bigdubsy • Dec 16 '12

ELI5: Why does Coca-cola still advertise? Explained

Why do companies that have seemingly maxed out on brand recognition still spend so much money on advertising? There is not a person watching TV who doesn't know about Pepsi/Coke. So it occurs to me that they cannot increase the awareness of their product or bring new customers to the product. Without creating new customers, isn't advertisement a waste of money?

I understand that they need to advertise new products, but oftentimes, it's not a new product featured in a TV commercial.

The big soda companies are the best example I can think of.

Edit: Answered. Thanks everyone!

Edit 2: Thanks again to everybody for the discussions! I learned alot more than I expected. If we weren't all strangers on the internet, I'd buy everyone a Pepsi.

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u/p7r Dec 16 '12

You're not the first, and you'll be far from the last! I read about it first to do with BMW, but I realise all the top manufacturers do it.

There is a great talk by Simon Sinek if you want to see what separates BMW, Apple, Mercedes and other premium brands in their marketing discussions from say Kia or Skoda. I suspect your car maker is probably one of the club.

I'll warn you though, once you see this, two things will happen:

  1. You'll realise how overly sentimental most advertising is. It is insane once you're aware of it.
  2. You'll become deeply skeptical of anybody or any corporation who talks to you about their values with an air of sincerity.

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u/Sammzor Dec 16 '12

God, the ways they try to make you feel like they care about your family. And "If you care about your family you will buy our product".

Just notice all the advertisements (especially billboards) that only show a person standing there smiling next to some text. Emotion sells!

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u/CommercialPilot Dec 17 '12

Here's a little trick I always used back when I sold tires for a dealership:

I'd inspect the tires, measure with a tread depth gauge, and if they were bald/cracked/dry rotted then I'd say to the customer "Well ma'am, your tires are really quite wore out. I wouldn't feel safe driving my family around on these tires to be honest with you. We can get you a price on a new set of tires if you'd like, then we can go from there?"

Works like a charm. If a person thinks their safety or the safety of their family is at risk...that plays a big factor when trying to sell them an item.

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u/Se7enLC Dec 17 '12

At first glance, it seems like evil trickery....but if you're only using it when their tires are ACTUALLY bald/cracking, I'm not sure I see the problem with it. Really, they should be buying new tires anyway!

You can even sweeten it up with some genuine concern, the "I don't care if you don't buy from us, just tell me you're going to get them replaced immediately?".