There is a common misconception that marketing and advertising are both one and the same. Whether online or offline, many business owners get confused over these two terms. In a nutshell, advertising refers to a particular product or service for a specified period of time while marketing refers to establishing the company’s name and reputation. Despite the divergent nature of these two practices, no business can survive without having a viable plan for both.

Advertising is essentially a business activity related to a particular product or service and creating a need or desire for the consumer to buy it. The advertising message is designed to create awareness that the product exists, how it will be of value to the consumer or makes life easier and convince the consumer to buy it immediately. Many advertisers today, even internet advertisers use the four Ps of advertising:

1. How the product benefits consumers
2. Offer a price that reflects great value for money
3. Informs consumers of all the places they can find the product
4. Promote the product for repeat or additional sales

One of the pitfalls of internet marketing has been the approach of marketing based on the company’s objectives, ignoring the needs of the consumer and failing to take profit into consideration. Many of the online marketers are too focused on recruitment of new distributors for a product or service with little idea whether or not there is a need for the product. They also have a tendency to apply shotgun approaches to their marketing efforts in hope that at least one of a several hundred shots will hit their target.

A good marketing plan will anticipate the needs of the consumer and make information about the product available to the consumer even before they realise they need it or want it. Planting this seed of desire can help to establish a higher price of the item because consumers are always willing to pay a premium price for something they believe they cannot do without.

The age old principal of supply and demand has long been used to calculate prices for many products or services. For an internet service-based business, however, it does not perform as well. While supply and demand usually work together to create market value, supply can influence demand by causing an upward spiral in prices which can eventually lead to a lower level of demand.

In recent years, to overcome this issue, many electronic game companies have begun to limit the quantity of their products being produced or distributed while using advertising to promote a perceived need for the product. By controlling the supply and using advertising to increase demand it helps to increase the price of the game in an open market.

Another way to define the difference between advertising and marketing is to use the following example. When you think about a favourite fast-food restaurant, identify what is the first thing that comes to your mind. Is it a particular food item they sell or the company’s logo? If it is the former, then advertising the company’s advertising has achieved its target, if it is the latter, then marketing has achieved its aim.