It was in the advertisement columns of The Times, at a somewhat earlier date, that men were first invited to try a humble but now indispensable article of male attire, the “new invented gallowses or breeches suspensors, for keeping up the breeches without girthing them tight round the waist, but, on the contrary, keep them well up and loose’. Of course, advertising was no new thing, even a hundred years ago. Nearly a century before that, Dr. Johnson had ventured the opinion that “the trade of advertising is now so near perfection that it is not easy to propose any improvement”.
Earlier still, in 1710, advertising was already so prominent as to merit an essay in The Taller by Dr. Addison himself. But a great growth came with the industrial revolution and the period of trade expansion which followed it, and the connection between the two series of events merits study. It helps to explain how and why the business of persuasion had become so closely interwoven with the production, distribution and consumption of goods in our early 20th century economy.
Many critics have drawn attention to the increasing disproportion between costs of distribution and costs of production in modern business enterprise. Whether or not advertising contributes to the high relative costs of distribution, it is not the fundamental cause, which is to be found in the inevitable separation of the producer from the consumer resulting from modern large-scale, highly specialised production.
Before the industrial revolution in the latter part of the eighteenth century, persuasive advertising on a large scale would have had no purpose, and the cost of distributing the ordinary necessities of life was negligible. The producer and the consumer lived side by side. Most articles were made to order and the producer had an assured though entirely local and limited market.
It is not without significance that the first important change in the old system of domestic industry came on the side of marketing, not of production.
The immunity of England from foreign invasion during the eighteenth century led to a steady increase in prosperity and to a growth of capital which was first exploited by entrepreneurs to expand the market for the products of domestic industries.
At first these “undertakers” sought out possible producers in their own homes, gave them orders to make the goods required, and themselves concentrated upon marketing the articles so produced over an ever wider and wider area. It was only by gradual stages that the undertaker became first the employer of the domestic producer, and then the organiser of production in a factory under his own control.
Once he had become a manufacturer he tended to devote himself to the problems of factory production and to leave the marketing of his goods to others. The enormous concentration upon production throughout the nineteenth century made the manufacturer the aristocrat of the industrial world.
Problems of marketing sank for a long time to a lower order of interest and importance. The manufacturer and the economist alike neglected them. But a time came when the problems of marketing forced their way back into the forefront and would no longer be ignored.
The enterprise and initiative first developed in the marketing field, then absorbed in the problems of production, had to turn again to marketing in order to find an adequate outlet for the products of the factories.
In the early days of factory production there was a ready sale for all the goods the factories could produce. The modern system of distribution arose and relieved the manufacturer of all anxiety about the disposal of his products. Wholesalers were eager to buy, and passed the goods on to the retailers who sold them to the public.
But as factory production grew, as wealth and investment increased, as new inventions multiplied and gave rise to the production of an ever increasing volume and variety of goods, the scales gradually shifted against the manufacturer.
He found himself faced with a whole new set of problems. He had invested his capital and his skill in factory plant that had enormously reduced the cost of production and enabled him to sell his goods to the wholesaler at an incredibly low price.
But the benefits of factory production were dependent upon a swift and assured outlet for the product of the machines, an outlet sufficient in scale to keep the machines working ail the time. And as production increased all round, the outlet for each individual producer became less and less assured.
The problem of overproduction, or, as we have now learnt to call it, under-consumption, began to make its appearance.
It is the existence of this problem, as Marshall has shown, that explains the increasing energy with which sellers push their goods on the notice of buyers. In particular, the rise of modern advertising is explained by the need of the manufacturer to assure himself of a steady and a profitable market in competition with an ever increasing variety of other mass-produced articles offered to the public.
In advertising the manufacturer discovered a technique which enabled him to regain control of his market by appealing directly to the ultimate consumer, and thus compelling wholesaler and retailer to stock his goods.
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