How does advertising work?

I am currently reading "Antifragile" by Nassim Taleb and find his take on big corporations interesting. He argues, convincingly, that most big corporations sell us useless or even harmful products, mostly through advertising. This set me thinking about the motives of advertising and its mechanisms. An idea came to me, and I made a matrix or quadrant to explain the mechanisms of advertising. This method is inspired by the "Johari Window" (known - unknown quadrant). Let’s call it Need vs. Awareness quadrant for a lack of better word or creativity on my part. 

Need vs. Awareness quadrant

Now let us do a thought experiment. Imagine a modern world like ours but without advertising. A world with broadband internet, and all the information that comes with it. A world exactly like ours, full of useless information that is mostly white noise, but with one critical difference. In this world, no one tells us what to buy. No one sells us a lifestyle or an aspiration. A world full of imperfections like ours but infinitely less dangerous. Now let us imagine a big corporation that manufactures carbonated drinks (popularly known as sodas). Let us call it X-Cola. X-Cola exists in this world and makes different products to kill us. We are aware of its existence, and we can read everything about it – annual sales, plant locations, different products and their imaginary benefits, the number of people employed, etc. You get the pitch.

But there is one crucial difference. X-Cola doesn't hire celebrities or beautiful people to advertise its products. They don’t tell us that X-Cola has been bringing happiness to our lives for the past 150 years by selling products that kill us. A strange way to bring happiness, I must say. Now let us see where X-Cola lies in our quadrant model in a world without advertising. 

For most people, X-Cola doesn't lie in the 1st quadrant. It is not a necessity. I hope most of us agree on that. It doesn't keep us alive or help us in any intellectual or spiritual way. It is a poor substitute for natural sugar. It is only a necessity for those who are addicted to it. For most other users, it is a product that they occasionally use. 

For the self-aware, it lies in the 2nd quadrant. They know it is harmful and hence don’t need it. They have programmed their minds about the harmful effects of it and avoid it like plague. 

It can’t lie in quadrant 3 because it is not a necessity. I hope most of us would agree with it. Even those who are working at X-Cola. I am sure that the X-Cola employees don’t give their company products to their kids and family members. At least I hope so. 

Now we are left with the 4th quadrant. In a world without advertising, X-Cola firmly lies in this 4th quadrant. Most of us are not aware of it, and we don’t need it. As a result, no one buys it except people who are addicted to it. 

Now let us bring advertising into the picture. 

X-Cola hires celebrities, actors, sportspersons, and beautiful, fit people to advertise its 17 types of sodas. In in a world of broadband internet and satellite TV, these ads are everywhere. What do these ads do? Without going into specific details of how advertising affects us psychologically, these ads move X-Cola products from the 4th quadrant to the 1st quadrant. We become aware of X-Cola and its products. These ads convince us that we need these products because celebrities, whose lifestyle we envy, use them. It is another matter that most of these people are lying.They don't care about the X-Cola but the money it pays them. Ordinary people start loving X-Cola and its products. As a result, the sales skyrocket to billions and billions of dollars.

This is advertising. It makes us aware of a useless and in some cases, a harmful product and then convinces us that we need it. We die while these corporations make billions.