Advertising Makes People Unhappy

Engineering demand is one of the main goals of marketing, and as such it is an indispensable tool for any for-profit company. In fact, these days, advertising is actually a crucial task in virtually any organization engaging with the public, be it non-profit, academic, government, local, etc. Yet, economic studies consistently demonstrate that advertising does not result in more optimal choices and in fact can lead to “analysis paralysis” with an overall decrease in optimal decision-making (at least according to the economic definition of such). The article below does a good job of reviewing the reasons for this “paradox” and largely echoes the words of Dr. Peat that “advertising is a dangerous cultural toxin” – i.e. in most cases it will be detrimental even when it tries to promote a beneficial product/service. The study also managed to discover a surprisingly specific quantitative (inverse) relationship between advertising and happiness. Namely, for every doubling in advertising spending happiness decreases by 3%. Considering advertising spending in the US has been doubling on average every 5 years or so since the 1960s, this alone can explain the mental health decline of most young people today.

Half of Millennials and 75% of Gen Zers may be mentally ill

Then what does make us happy? Well, according to the study – being healthy, feeling loved, and a sense of purpose/community. Apparently, life is pretty simple if you listen to your intuition and not to whatever the latest ad is babbling about:-)

https://hbr.org/2020/01/advertising-makes-us-unhappy

“…The University of Warwick’s Andrew Oswald and his team compared survey data on the life satisfaction of more than 900,000 citizens of 27 European countries from 1980 to 2011 with data on annual advertising spending in those nations over the same period. The researchers found an inverse connection between the two. The higher a country’s ad spend was in one year, the less satisfied its citizens were a year or two later. Their conclusion: Advertising makes us unhappy.”

“…We did find a significant negative relationship. When you look at changes in national happiness each year and changes in ad spending that year or a few years earlier—and you hold other factors like GDP and unemployment constant—there is a link. This suggests that when advertisers pour money into a country, the result is diminished well-being for the people living there.”

“…Their line is that advertising is trying to expose the public to new and exciting things to buy, and their task is to simply provide information, and in that way they raise human well-being. But the alternative argument, which goes back to Thorstein Veblen and others, is that exposing people to a lot of advertising raises their aspirations—and makes them feel that their own lives, achievements, belongings, and experiences are inadequate. This study supports the negative view, not the positive one.”

“…Yes, some might see that watch ad and say, “Why are men buying $10,000 watches when they carry a mobile phone with the time on it?” Or respond to a car ad by congratulating themselves for not buying a gas-guzzler that’s expensive to service and destroys the environment. Our research shows that the really big influences on human happiness are things like health, intimate relationships, being employed, social safety nets, not being in midlife (there really is a crisis for many), and so on. Buying that watch or car can help make us feel slightly happier, but deep down it has a keeping-up-with-the-Joneses status effect. And when everybody buys the same thing the effect is nullified. That’s partly why advertising hurts group happiness; there’s only so much status to go around.”

“…Our analysis shows that if you doubled advertising spending, it would result in a 3% drop in life satisfaction. That’s about half the drop in life satisfaction you’d see in a person who had gotten divorced or about one-third the drop you’d see in someone who’d become unemployed. We have a lot of experience working out how people are affected by bad life events, and advertising has sizable consequences even when compared with them. I try to be an evenhanded statistical researcher, but I can see how you might look at our study and think, “Maybe it’s sensible for me to opt out of some of these ads.”