Advertising & Society: Social, Ethical, and Regulatory Aspects of Advertising and Promotion

Advertising & Society
Social, Ethical, and Regulatory

Aspects of Advertising and
Promotion
Social Aspects of
Advertising
 Advertising Educates Consumers
– Pro: Advertising informs
– Con: Advertising is superficial and intrusive
Is there “information” in
this ad?
 Advertising improves living standards

– Pro: Ads lower the costs of products
– Con: Ads are wasteful and help only some
Ad in Context Example
Critics
Critics of
of advertising
advertising
feel
feel that
that advertising
advertising is is
superficial
superficial because
because
many
many adsads carry
carry little
little
actual
actual product
product
information.
information. DoDo youyou
think
think advertising
advertising is is
superficial?
superficial?
Social Aspects of
Advertising
 Advertising Affects Happiness and Well-Being

– Con: Ads create needs
– Pro: Ads address a wide variety of
basic human needs
– Con: Ads promote materialism

– Pro: Ads reflect society’s priorities
Critics
Critics feel
feel
advertising
advertising
promotes
promotes
materialism.
materialism.
Social Aspects
of Advertising
 Advertising: Demeaning and deceitful, or
liberating and artful?
– Con: Ads perpetuate stereotypes
– Pro: Advertisers are more sensitive now
– Con: Ads are often offensive

– Pro: Ads are a source of liberation
– Con: Ads deceive via subliminal stimulation

– Pro: Advertising is art
Do
Do you
you think
think this
this
ad
ad perpetuates
perpetuates
stereotypes?
stereotypes?
Do
Do you
you think
think
this
this ad
ad
perpetuates
perpetuates
stereotypes?
stereotypes?
Social Aspects of
Advertising
 Advertising has a Powerful Effect on the Mass
Media
– Pro: Ads foster a diverse and affordable mass media
that provides information and exposure on important
issues.
– Con: Advertising affects and controls programming.

“Branded Entertainment” blurs entertainment and
persuasion. And, controversial issues do not attract
advertisers.
Ethical Aspects of
Advertising
Ethics are the moral standards against which

behavior is judged. Key areas of debate
regarding ethics and advertising are:
 Truth in advertising
 Advertising to children
 Advertising controversial products
Ethical Aspects of
Advertising
Truth in Advertising
 Deception is making false or misleading statements, but
puffery (commercial exaggeration) is legal.
 Cannot legislate against emotional appeals

Ethical Aspects of
Advertising
Advertising to Children—Issues
 Advertising promotes superficiality and materialism in
children
 Children are inexperienced and easy prey
 Persuasion to children creates child-parent conflicts
 What does the literature say about kid’s abilities to process
persuasive information?
Ethical Aspects of
Advertising
Advertising Controversial Products

 Critics question “targeting” minorities
 Tobacco, alcohol, gambling and lotteries are product
categories of greatest concern
 How does the concept of “primary demand” provide insights
here?
 What does the literature say about advertising’s impact on
these product categories?
Regulatory Aspects of
Advertising
Areas of advertising regulation:

 Deception and unfairness
– Representation or omission that can mislead
– Judged from perspective of consumer
 Competitive issues
– Vertical cooperative advertising
– Comparison advertising
– Monopoly power
 Advertising to children
Key Regulatory Agents
Government Regulation
 Federal Trade Commission (FTC)
– Wide range of regulatory programs and remedies
 Federal Communications Commission (FCC)
 Food and Drug Administration (FDA)
 U.S. Postal Service
 Bureau of Alcohol, Tobacco, and Firearms

Key Regulatory Agents--FTC
FTC Programs and Remedies

 Advertising Substantiation Program
 Affirmative Disclosure
 Consent Order
– Cease and Desist Order
– Affirmative Disclosure
 Corrective Advertising
 Control of Celebrity Endorsements

(con’t)
Industry Self-Regulation
 National Advertising Review Board (NARB)
 State and Local Better Business Bureaus
 Ad Agencies and Associations
 Media Organizations
(con’t)
Internet Self-Regulation
 No industry-wide trade association has
emerged to date
 Global Dialogue on Electronic Commerce

(GBDe) is emerging as a governing body
 Little progress has been made to address

consumers’ complaints
(con’t)
Consumers as Regulatory agents

 Consumerism: Grass roots consumer
movements
 Consumers Organizations
– Consumer Federation of America
– Consumers Union
– Consumer Alert
– Commercial Alert
Regulation of Other
Promotional Tools
Direct Marketing and e-Commerce
 Privacy, Contests, Telemarketing
 Spam=30 million messages/minute, 50 billion/day
worldwide
 “Phishing” as insidious spam
Sales Promotion
 Premiums, Trade Allowances, Contests/Sweepstakes
Public Relations
 Privacy, Copyright Infringement, Defamation (slander and libel)

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Advertising & Society

Social, Ethical, and Regulatory

 Advertising improves living standards

 Advertising Affects Happiness and Well-Being

– Con: Ads promote materialism

– Con: Ads are often offensive

– Con: Ads deceive via subliminal stimulation

– Con: Advertising affects and controls programming.

Ethics are the moral standards against which

 Cannot legislate against emotional appeals

Advertising Controversial Products

Areas of advertising regulation:

 Federal Communications Commission (FCC)

 Food and Drug Administration (FDA)

 U.S. Postal Service

 Bureau of Alcohol, Tobacco, and Firearms

FTC Programs and Remedies

 Control of Celebrity Endorsements

 Global Dialogue on Electronic Commerce

 Little progress has been made to address

Consumers as Regulatory agents

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