Canada Needs Advertising: Advertising and the Economic Recovery

“At this stage in the economic cycle, the service sector should be sprinting into recovery, not limping as it is now. And the missing ingredient is the consumer.” Michael Gregory, BMO Nesbitt Burns Economist

For better or for worse North America’s economy is a consumer driven economy. And that means that jobs in retail, service and (still) manufacturing are dependent on advertising to stimulate consumer spending for Coke, condominiums, cars or snow blowers.

Traditionally, advertising has been a driver of consumer demand. Blamed for making needs out of wants, advertising, the art of persuasion, has helped create the consumer-driven economy.

If you believe that advertising is persuasion and that persuasion generates economic activity, it comes as no surprise that advertising spending and economic declines are congruent:

Global advertising spend is expected to drop 5.5 percent in 2009, more than previously thought, before a mild recovery begins in 2010, according to a new forecast. (Reuters, June 2009). 

Clearly nobody needs a Lexus but advertising has created a viable luxury brand. The first Lexus to be made outside Japan was built in Ontario. Lexus sales mean more jobs for Canadians.