Does advertising create sustained fair value: the capitalization of brand intangibles

Does advertising create sustained fair value: the capitalization of brand intangibles Essay example
Masters
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Finance & Accounting
Pages 20 (5020 words)
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Advertising and Sustained Fair Value: The Capitalisation of Brand Intangibles Chapter 1 Introduction Introduction In the last 15 years, the importance of knowledge-based assets and other intangibles has become one of the key factors driving global economic activity (Skinner 2008)…

Introduction

In the context of the on-going debate regarding the increasing importance of intangibles in the global market economy, this research will look into one of the tools use by organisations in creating intangible asset – advertising and whether advertising create sustained fair value for the company. Advertising is generally viewed as any paid form of non-personal communications about the product, services or ideas by an identified sponsor (Alexander 1965, p. 9). Through advertising, organisations and manufacturers carefully convey their message to the target market, which is to sell and try their products, services and idea. As such, selling commodities, services or ideas are the primary purpose of advertising (Amadi 2005). In this sense, advertising is an essential tool that is employed by corporations in order to increase sales. Increase in sales though advertising is attained with the supposition that advertising provides the venue wherein the product of the organization becomes known in the market, thus, opening the market for the product or if it is already in the market, increasing the market share (Van Gelder 2005). ...
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