Ads will drive down cost of pasta, dairy products, meat, eggs
A new study suggests that ads may be making up for the cost of ingredients.
The study, published Monday in the journal Applied Economics Letters, looked at how ads and other marketing efforts impact consumer spending.
The results are interesting, says University of Virginia economist Joseph Salerno.
“They really do look like an opportunity to lower the cost,” Salerno told ABC News.
Salerno believes the results suggest that advertising will help consumers avoid spending more than they do now.
“I think it is an opportunity for us to think about what other kinds of interventions we can do,” he said.
Salena, a professor of marketing at the University of Vermont and co-author of the study, says the findings suggest that ads and advertising spade may be a more effective way to reduce food prices than price-gouging government regulations.
He says the study could provide new ideas on how to use ads to boost consumer spending, and on how they can be used to increase food supply.
For example, the study suggests advertising can lower the costs of a cheese by reducing the amount of milk and reducing the cheese’s price by about 10%.
Salerno thinks this could have an impact on the price of cheese.
Saleno says the benefits of ads are most likely to come from the effect of the ads on consumers.
He points to a study published last year that showed that when people watch ads, they tend to reduce their spending.
“If you increase the cost, people will reduce their expenditures and they will have less of them,” he says.
Salon also says that there’s a reason that ads are being used by the dairy industry to lower costs.
“It’s not because the dairy is doing anything wrong, it’s because they are trying to increase production, and so they are able to reduce costs,” he explains.
Salonica says the dairy business has seen its profits decline over the last decade.
He points to the low prices of milk, cheese and eggs as the result of the industry’s decision to lower production.
Salonen also says it could be a way to help people avoid spending money on high-end foods.
If a food can be cheaper than the average cost of production, that would help people, he says, and that would lower food prices.
Salina says the industry is working on a new campaign to help reduce food costs.