In the consumer-goods space, when demand slows down or price-sensitive segments dwindle, many companies respond by ramping up advertising — more campaigns, louder messaging, broader reach. But if the core issue is consumers’ perception of value (price, quality, affordability, convenience), then piling on ads often just increases awareness — not sales. In fact, heavy advertising in a value-sensitive market may turn into wasted spend.

Below are the structural dynamics that show why advertising alone isn’t enough — and what really drives purchase decisions in value-driven consumer goods.

Why Advertising Can’t Patch Over Value Perception Gaps

1. High price-sensitivity makes value perception king

Studies on consumer behaviour in India’s FMCG / household-care segment show that consumers are often highly price-sensitive. Buyers from lower- or middle-income households evaluate products based on perceived value for money — not just brand image or ad recall. When price and value perception don’t align — even a well-advertised product fails. In rural and semi-urban markets especially, quality remains important, but “value + accessibility” wins over premium positioning.

2. Advertising may raise awareness — but doesn’t ensure availability or affordability

Advertising—whether on TV, digital or print—works at the “awareness and intent” layer: making the consumer aware and perhaps interested. Multiple studies confirm that ad exposure positively correlates with purchase intention and brand attitude. But purchase behaviour in FMCG (and broader consumer goods) is strongly influenced by tangible factors like price, pack-size, availability, and fulfilment reliability. If the product is priced high relative to perceived benefit — or if it's not easily available in a shopper’s locality — awareness does not translate into purchase.

3. Value perception interacts with pricing and packaging — advertising cannot change that equation

Recent research shows that besides advertising, pricing strategies and product information (like pack-size, ingredient transparency, quality cues) play critical roles in purchase decisions for FMCG and household goods. If a product’s price or pack configuration doesn’t align with consumer expectation of value, even the most emotionally resonant advertising won’t help. Over time, repeated mismatches erode trust, reduce repeat purchase and degrade brand equity.

4. Advertising’s effect on “perceived value” is modest — and often temporary

Large-scale empirical analysis across 575 brands over 5 years found that advertising did increase metrics like “perceived quality,” “perceived value,” and “recent satisfaction.” However the magnitude was limited and varied by ad type (national traditional, local, digital) — and price / value perception largely remained determined by factors outside advertising. In other words: advertising can nudge perception slightly — but cannot restructure value expectations, especially in markets where consumers constantly compare price, quality, and alternatives.

5. In highly fragmented & price-sensitive markets (like many parts of India), over-reliance on ads ignores supply, distribution & affordability constraints

In many lower-income, rural or semi-urban regions, consumers choose fast-moving consumer goods based on pack-size, price per use, perceived quality, and local availability — not on branding. When brands ignore this and keep pushing for visibility, they may reach many eyeballs — but fail to convert because distribution, value packaging, or price positioning don’t support the ad promise.

What This Means for Consumer-Goods Brands: A Better Value-Focused Playbook

Given the structural limitations of advertising in value-sensitive markets, here’s a more robust strategic framework:

1. Segment by value-sensitivity — not geography alone Identify consumer clusters based on price elasticity, income, and consumption behaviour. For each cluster, design SKUs, packaging, pricing and messaging aligned with perceived value.

2. Prioritise pricing, packaging, and value-for-money over brand-only marketing Offering refill packs, smaller SKUs, or cost-efficient formats often matters more than premium-sized bottles. Transparent pricing + honest value proposition builds trust.

3. Ensure product availability and affordability before scaling visibility campaigns Launch marketing campaigns only in geographies where supply chain, retail/distribution, and price-perception align with product positioning.

4. Use advertising to reinforce a credible value message — not to paper over mismatches Ads should highlight real value propositions — pack size, cost-per-use, convenience — rather than aspirational premium branding that may not resonate if the price-value ratio is skewed.

5. Track outcome metrics beyond reach & recall — monitor conversion, repurchase, price elasticity, SKU-level performance Use data to measure how value perception (price, packaging, perceived quality) drives behaviour — not just how many people saw the ad.

Conclusion: When Demand Depends on Value — Ads Alone Are a Risk

In markets where consumers are price-conscious, sensitive to value, and quick to switch when alternatives offer better value, visibility built through advertising can only do so much. It shapes perception, not purchase.

If the product’s value equation — price, packaging, quality, availability — isn’t aligned with consumer expectations, then advertising becomes an expensive visibility exercise with limited ROI.

For most consumer-goods companies operating in price-sensitive categories, the levers of pricing, packaging, distribution and value-for-money promise matter more than advertising noise.

In short — advertising doesn’t fix a value perception problem. Fixing value perception fixes both demand and sustainable growth.

References: Researchgate - Jhansi Rani M R & ChithrankaJMSR - Vaibhav Prakash & Dr. Nausherwan Raunaque Researchgate - Dr. Akshay Katiyar, Vidushi Gupta & Sonali SankhlaJETIR - Reetika AgrawalResearchgate - Harish B Bapat, Shilpa Shinde, Pooja Varma & Pallavi PrahladARXIV - Rex Yuxing Du, Mingyu Joo & Kenneth C. Wilbur