Social, Ethical, and

Regulatory Aspects of
Advertising and Promotion
 Advertising and Promotion: Two Viewpoints

Proponents
Proponents Argue
Argue That
That
Advertising
Advertising and
and Promotion:
Promotion:

Encourages
Encourages Creates
Creates Jobs
Jobs and
and
Provides
Provides AA Higher
Higher Standard
Standard Helps
Helps New
New Firms
Firms
Information
Information Of
Of Living
Living Enter
Enter aa Market
Market

Promotes
Promotes
Competition
Competition in
in
The
The Marketplace
Marketplace

Critics
Critics Argue
Argue That
That Advertising
Advertising and
and
Promotion
Promotion

Promotes
Promotes
Creates
Creates Needs
Needs and
and Is
Is More
More Materialism,
Materialism,
Wants
Wants Among
Among Propaganda
Propaganda Insecurity
Insecurity and
and
Consumers
Consumers Than
Than Information
Information Greed
Greed
© 2003 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
 Ethics in Advertising and Promotion

Ethics:
Ethics: Moral
Moral principles
principles and
and values
values that
that
govern
govern the
the actions
actions of
of and
and individual
individual or
or group.
group.

AA Marketing
Marketing or
or Marketers
Marketers Must
Must
Not
Not All
All Issues
Issues Promotion
Promotion Action
Action Make
Make Decisions
Decisions
Can
Can BeBe May
May Be
Be Legal
Legal but
but Regarding
Regarding the
the
Regulated
Regulated Not
Not Considered
Considered Appropriateness
Appropriateness
Ethical
Ethical of
of Their
Their Actions
Actions
I know what is right but I could
not able to do it, I know what
is wrong but I could not
restrain my self from doing it.
Advertising and Promotion as
Untruthful or Deceptive

General
General Mistrust
Mistrust of
of Advertising
Advertising and
and
Among
Among Consumers.
Consumers. Many
Many Do
Do Not
Not
Perceive
Perceive Ads
Ads As
As Honest
Honest or
or Believable
Believable

Abuses
Abuses Involving
Involving Sales
Sales Promotions
Promotions
Such
Such As
As Contests,
Contests, Sweepstakes,
Sweepstakes,
Premium
Premium Offers
Offers

Unethical
Unethical And/or
And/or Deceptive
Deceptive Practices
Practices
Involving
Involving Mail
Mail Order,
Order, Telemarketing
Telemarketing
and
and Other
Other Forms
Forms of
of Direct
Direct Marketing
Marketing

Internet
Internet Scams
Scams and
and Abuses
Abuses
Many People Found Benetton’s “Death Row”
Ad Campaign Offensive
 Advertising and Children

Children's
Children's TV
TV
Watching
Watching Behavior
Behavior

Children
Children between
between ages
ages Television
Television is
is an
an
2-11
2-11 watch
watch on
on average
average important
important source
source of
of
21.5
21.5 hours
hours of
of TV
TV per
per information
information for
for
week
week and
and may
may see
see children
22,000 children about
about products
products
22,000 commercials
commercials
per
per year
year
 Perspectives on Advertising to Children

Consumer
Consumer Advocates
Advocates Argue
Argue That
That
Children
Children Are
Are Vulnerable
Vulnerable to
to
Advertising
Advertising Because:
Because:

They
They Lack
Lack the
the They
They Cannot
Cannot
Knowledge
Knowledge and and Differentiate
Differentiate
Skills
Skills to
to Critically
Critically Between
Between Programs
Programs
Evaluate
Evaluate and
and Commercials
Commercials
Advertising
Advertising Claims
Claims

While
While Marketers
Marketers Argue
Argue That:
That:

Children
Children Must
Must Learn
Learn Need
Need toto Acquire
Acquire
Through
Through the
the Skills
Skills Needed
Needed
Socialization
Socialization To
To Function
Function in
in the
the
Process
Process Marketplace
Marketplace
Social and Cultural Consequences
of Advertising

Does
Does Advertising
Advertising Make
Make
People
People Buy
Buy Things
Things
They
They Don’t
Don’t Need?
Need?

Does
Does Advertising
Advertising
Encourage
Encourage Materialism?
Materialism?

Is
Is Advertising
Advertising Just
Just
A
A Reflection
Reflection of
of Society?
Society?
 Advertising and Stereotyping

Portrayal
Portrayal of
of Women
Women to
to
Reflect
Reflect Their
Their Changing
Changing
Role
Role in
in Society
Society

Portrayal
Portrayal of
of
Gender
Gender
Criticisms
Criticisms of
of Women
Women As As
Stereotyping
Stereotyping
Advertising Sex
Sex Objects
Objects
Advertising
With
With Regard
Regard to
to
Stereotyping
Stereotyping

Ethnic
Ethnic
Portrayal
Portrayal of
of Stereotyping/
Stereotyping/
The
The Elderly
Elderly Representation
Representation
of
of Minorities
Minorities
What is your opinion of this ad?

Is
Is This
This Woman
Woman Portrayed
Portrayed As
As
aa Sex
Sex Object?
Object?

Does
Does This
This Ad
Ad Contain
Contain
Cues
Cues That
That Are
Are Sexually
Sexually
Suggestive?
Suggestive?

Does
Does This
This Ad
Ad Present
Present an
an
Image
Image ofof Sexual
Sexual
Submissiveness?
Submissiveness?
The U.S. Government Used Advertising
To Discourage Drug Use

Should
Should Drug
Drug Use
Use Be
Be Linked
Linked With
With Terrorism?
Terrorism?

+ +
Do Advertisers Control the Media?

Advertising
Advertising Is
Is the
the Primary
Primary Source
Source
of
of Revenue
Revenue for
for Newspapers,
Newspapers,
Magazines,
Magazines, and
and Television
Television and
and
Radio
Radio Networks
Networks andand Stations
Stations

The
The Media’s
Media’s Dependence
Dependence onon
Advertising
Advertising For
For Revenue
Revenue Makes
Makes
Them
Them Vulnerable
Vulnerable To
To Control
Control by
by
Advertisers
Advertisers

Advertisers
Advertisers May
May Exert
Exert Control
Control
Over
Over The
The Media
Media by
by Biasing
Biasing
Editorial
Editorial Content,
Content, Limiting
Limiting
Coverage
Coverage of of Certain
Certain Issues
Issues or
or
Influencing
Influencing Program
Program Content
Content
Do Advertisers Control the media?

They
They Must
Must Report
Report the
the News
News
Fairly
Fairly and Accurately to
and Accurately to Retain
Retain
Public
Public Confidence
Confidence

Advertisers
Advertisers Need
Need the
the Media
Media
More
More Than
Than the
the Media
Media Need
Need Any
Any
One
One Advertiser
Advertiser

The
The Media
Media Maintain
Maintain Separation
Separation
Between
Between News
News and
and Business
Business
Departments
Departments “The
“The Wall”
Wall”
Economic Impact of Advertising

Effects
Effects on
on Consumer
Consumer Choice
Choice
•• Differentiation
Differentiation
•• Brand
Brand Loyalty
Loyalty

Effects
Effects on
on Competition
Competition
•• Barriers
Barriers to
to entry
entry
•• Economies
Economies ofof scale
scale

Effects
Effects on
on product
product costs
costs and
and prices
prices
•• Advertising
Advertising as
as an
an expense
expense that
that
increases
increases the
the cost
cost of
of products
products
•• Increased
Increased differentiation
differentiation
Advertising Helps New Competitors
Enter the Market
Do You Agree With Leo Burnett?

“It must be said that without

advertising we would have a far
different nation, and one that
would be much the poorer-not
merely in material commodities,
but in the life of the spirit.”

These excerpters are from a speech given by Leo Burnett on the American
Association or Advertising Agencies’ 50th anniversary, April 20,1967
 Social & Ethical Criticisms of
Advertising

• Advertisers are criticized as

– Deceptive or untruthful,
(telemarketing or other forms of
direct marketing.)
– Offensive or in bad taste,
– Exploitative of certain groups such as
children,
 Common Deceptive practices in
Advertising
• False & misleading presentation of facts
• Implying a benefit that does not exist,
• Deliberate omitting of a needed information,
• Sex in Advertising,
• Creating cultural degeneration,
• Creating ambiguities in minds of consumer
• Open Criticism of Competitors
• Trade puffing & exaggeration,
• Tasteless advertising,
• Advertisement for harmful products & services.
 Advertising principles of American
Advertising Federation
• Truth: Advertising shall reveal the truth, and reveal significant
facts, omission of which would mislead the public,
• Substantiation: Advertising claims shall be substantiated by
evidence in possession of advertiser and the advertising
agency prior to making such claims
• Comparisons: Advertising shall refrain from making false
misleading or unsubstantiated statements or claims about
competitors or his products
• Bait of advertising: Advertising shall not offer products or
services for sale unless such offer constitutes a bona fide
effort.
• Guarantees and warranties should be explicit
• Price Claims or saving claims that do not proven
• Testimonials
• Taste and decency
 Regulatory Bodies in India to control
unethical practices of Advertising

• ASCI
• Consumer protection Act of 1986,
• MRTP