What Is Competitive Advertising? Advantages and Disadvantages

What is competitive advertising?

The best way to learn about competitive advertising is to read the latest news.

To get started, you can check out this article on It’s a great place to start learning more about what competitive advertising means and how it affects your business or industry specifically.

Why Some Companies Struggle With Competitive Billboard Pricing
Why Some Companies Struggle With Competitive Billboard Pricing

What Is Competitive Advertising?

Competitive advertising is the act of promoting one’s product in comparison to another company’s product. This type of promotion can be used as a strategy to target consumers who are loyal to the other brand, forcing them to reconsider their buying habits.

It also works on new consumers who might consider purchasing both products because they do not have enough knowledge about them yet. If the competitive advertising is successful, it will also decrease whatever market share the other brand has.

Examples of Competitive Advertising

An example of competitive advertising can be seen in the soft drink industry. One company may promote how much sugar its product has while showing a picture of an apple to compare to how much sugar their drink has compared to the fruit.

At the same time, the rival company may be doing something similar in stating that their drink has less sugar than the competitor product.

Another example of competitive advertising is when companies will show statistics about their product to compare it with another brand. They also include price comparisons so consumers can see which product offers better value for money on certain features.

High Quality Product

Competitive advertising involves the strategies of two competitors in an industry.

If one company wants to compete with another, they will create advertisements showing how their product is better than that of other companies and cite customer polls or surveys as well subjective stories (but don’t mention them by name).

An example would be Before-and-after pictures comparing washed clothes from both detergents along with ads that use creative storytelling techniques without mentioning any specific brands involved

The following passage details some ways for businesses like Walmart which competes heavily against Target Stores Incorporated . In order maintain consumer loyalty , it is important not just provide low prices but also offer high quality products at affordable cost while maintaining excellent service

Head-to-Head Advertising

Head-to-head advertising is a television marketing technique in which two advertisements for competing products are placed back to back so that they both air during the same commercial break.

The theory behind head-to-head advertising is that while consumers may develop brand loyalty, there will always be a “target market” for each company’s product, and these people should be targeted with an ad for their preferred brand.

Negative Comparative Advertising

Advertising has always been a marketing tool for companies to get their product in front of consumers. Many businesses use this advertising strategy because it is beneficial to them and relatively inexpensive compared to other mediums, such as television advertisements or websites.

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Negative comparative advertising is an advertising gimmick that involves directly contrasting the company’s product with another brand that may be more popular than theirs. An example would be Coca-Cola running a commercial saying “Coke tastes better than Pepsi.”

This type of advertisement will leave out any positive qualities about its own product, while solely focusing on why its competitor is inferior. It can also involve making fun of the competitor’s products or logos, or using actors who are similar in stature or looks to spokespeople for competing products.

In many cases, negative comparative advertising has been known to incite a legal battle between two broadcast companies as a result of the huge amount of publicity that is received from such an advertisement

Market-Wide Ranking

In the US, a company needs to show its product’s superiority in order for consumers be influenced.

Companies might use independent market rankings or taste tests as evidence of this claim and rely on them when advertising that their car has superior fuel efficiency versus other models within specific classes or with top-rated firms like JD Power Awards .

Advertising in the Pharmaceutical Industry

The pharmaceutical industry is a multi-billion dollar business. Pharmaceutical companies produce, test and sell medications for various medical conditions that affect the health of those who buy them.

These medications range from those that treat common colds to those that treat life threatening illnesses such as cancer. To determine whether or not the public needs their drugs, manufacturers must go through a three step process.

The first is research and development, which includes the discovery of new drugs or medications that can treat illnesses. This initial phase costs an average of about one billion dollars.

The second phase includes samples being sent to doctors for testing. After the testing period has ended, pharmaceutical companies begin to advertise their product in popular medical journals.

Their goal during this period is to convince doctors that their product is superior to the others being sold, and that it should be used by all patients.

Finally, after spending about one billion dollars on research and development, billions more on advertising their products, and several years of testing them with the help of doctors.

Social Economics & Business Importance of Advertising

Advertising has always been an integral part of business and social economics. Whether it is the existent of the company itself, the quality of its product or services, or even its marketing strategy; advertising can affect aspects in these areas.

The majority of people who purchase items do not choose solely on how much something costs when they are shopping; rather, many people are thinking of their budget in terms of how much they can afford to pay for an item.

With the possibility of discounted items, prices on certain items may differ depending on where it is being sold. This difference in pricing has one driving force behind it: advertising and marketing efforts.

The company or business that spends more money on advertising and marketing their product or service has the opportunity to set the price of that item where they desire.

Comparative & Competitive Advertising

Competitive Advertising and Why It's Important | GLAD WORKS
Competitive Advertising and Why It’s Important | GLAD WORKS

Advertising is a vital part of any business, big or small. It can be used to make you competitive in the market and also helps build rapport with your existing customers.

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If you think about it, most businesses do some type of advertising even if they are only doing it to maintain their current customer base rather than increase market share. Some businesses get caught up in the more common forms of advertising such as billboards, radio ads and TV commercials.

However, there are many other ways to advertise that may be cheaper or just as effective if not more so than some of the more commercial methods.

Competitive Advertising Advantages

Competitive advertisements are used as a way to bolster consumer confidence in your business while also strengthening the faith that consumers have in your competition.

There are several advantages associated with competitive advertising, including customer loyalty, increased company revenue, and stronger market share.

Customer Loyalty

One of the biggest advantages to competitive advertising is an increase in customer loyalty. When you gain a great deal of customer loyalty, it is much more probable for your business to experience growth and financial stability.

It is also less likely for you to witness a decline in revenue due to the introduction of new competition or changes in consumer demand.

Increased Company Revenue

One common reason that companies place competitive advertisements is to increase company revenue. For example, Coca-Cola has been running advertisements for many years which place emphasis on their soda being “the real thing.”

What this means is that they are trying to convey the idea that Pepsi, a popular competitor, is not made with pure sugar cane.

Improved Market Share

While advertising can be very effective towards generating revenue, it can also garner you a better market share. A larger market share may encourage your competition to lower their prices in order to undercut you, which can lead to an increase in revenue for your business.

Just remember that this will not always be the case; sometimes the introduction of new competitors into the market can result in lowered sales.

Additional Benefits

There are many different reasons as to why you will see ads on television, billboards and websites.

Some companies choose to place competitive advertisements in order to convey a sense of security and quality within their products; this empowers consumers to make more informed decisions about which product they should buy.

Another reason that businesses may employ such advertising strategies is that doing so has the ability to increase the amount of traffic to their business website.

When running competitive advertisements, you should always first research your competitors, so that you can understand what they are offering and who their target demographic is.

With this information at hand, you will be able to determine which advertising strategies will work best for your business.

Competitive Advertising Disadvantages

10 Disadvantages and Limitations of Advertising - ToughNickel
10 Disadvantages and Limitations of Advertising – Tough Nickel

Too Many Competitors

This is a common obstacle for many companies and advertisements. When there are too many competitors, the market becomes saturated and consumers won’t know which product to buy or who to trust.

With so many choices, clientele will go with the cheapest option, the most reputable company, etc., leaving you at a disadvantage.

More Advertising To Spend

In a highly competitive market, companies have to work twice as hard and spend double the money. In turn, this can cause a strain on businesses’ budgets and limit spending in other areas, such as product development or hiring more employees.

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You may also have to hire an agency or company to handle your marketing in order to stay in the race.

Less Creative Freedom

When you need to focus on staying afloat, there is less space for creativity. Although it may seem fun and exciting, creating a new ad campaign or product can be an extremely costly mistake if it fails.

With limited resources available, companies are forced to stick with tried and true methods and models until the competition dies down.

Limited Ways To Get Attention

With so many advertisements flooding the market, it’s hard to stand out from the crowd. With limited ways to get attention, companies may have to resort to shock value or sexual content in order to receive media coverage.

While these ads may be successful for a short time, they’re not sustainable and can cause a drop in sales once the shock value wears off.


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