It’s easy to dismiss advertising as just a profit engine for ad platforms, but that’s only part of the picture. At its best, advertising plays a meaningful role in solution and product discovery, especially for new or niche offerings that users wouldn’t encounter otherwise. It also promotes fairer market competition by giving smaller players a shot at visibility, and by making alternatives accessible to customers, without relying solely on monopolistic platforms or the randomness of word-of-mouth.
That said, today’s ad ecosystem is far from ideal - often opaque, invasive, and manipulative. Still, the underlying idea of advertising has real value. Fair advertising is a hard problem, and while reform is overdue, banning it outright would likely create even bigger ones.
It's only when some actors start advertising that the others must as well, so they don't fall behind. And so billions of dollars are spent that could have gone to making better products.
It's basically the prisoner's dilemma at scale.
This is unbelievably untrue. Consider clothing brands, large and older labels have an immense advantage over newcomers. Newcomer word of mouth will never come close to some brand that has a store in every mall across the US.
With (say) Instagram ads alone, tiny labels can spend and target very effectively to create a niche, and begin word of mouth.
Gap and Lululemon would love it if all advertising was shut off today. It would basically guarantee their position forever because of the real estate and present day distribution Schelling point.