Yes, name recognition through advertising is actually a thing. But it's nowhere near as big as advertising agencies would have you believe. Like most people with a product to sell, they exaggerate its effectiveness. The only thing an advertising agency absolutely must sell to stay in business is – advertising. Selling their clients' products is strictly optional.
There's a reason why so many traditional media companies are circling the drain. They depended on ‘name recognition’ (or ‘lifestyle’) advertising, which ad agencies knew how to sell, but which produces no tangible evidence of its own success or failure. Suddenly along came Internet ads, where you can instantly tell how many people saw the ad, how many clicked through, and how many ended up purchasing the product that session. Advertisers learned quite a lot about what kinds of ads work and what kinds don't; and it did not match up well with what the old media were good at.
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