Sunday, September 15, 2013

Advertising, Products, and Consumption in Germany

Walking around in Munich one day, our ever-observant Inger pointed out the lack of advertising - actually, both that there were fewer ads to be seen and they weren't really in-your-face trying-to-sell-something ads. A few conversations and observations later, including conversation with corporate executives, revealed the following insights.

First, German companies make better products (at least they claim that they make better products, and I have no trouble agreeing with this claim) . In their view, the product sells itself - you don't have to dance around the consumer to make her pick your product.

Second, German consumers are more conservative with their consumption. Certainly they have smaller places to live in, so need less of everything (say, one television set in a house rather than two or four) - but also their purchasing focus tends to be quality rather than quantity. So, this diminishes one purpose of advertising which is to make people buy more - even if it is making people to buy more of things they do not need.

Third, in many product categories there is a smaller set of competing brands available - hence each brand has to spend less on advertising to push itself to be selected. I can't be sure of this, but it is certainly an empirically testable idea.

I have been in Germany many times over the last 20 years, but never really noticed this point about less advertising - but now that I think about it, it certainly seems true, whether it is ads on TV, in print media, on street billboards, and even promotions near the checkout counter. You don't see companies trying to push their products on you everywhere. Instead they focus on making better products. We could certainly use some of that in the US.

No comments:

Post a Comment

Post a Comment