Ethics of Advertising

A business Ethics PresentationBy University of South Asia

What is advertising? Advertising is a form of

communication used to help sell products and services. Typically it communicates a message including the name of the product or service and how that product or service could potentially benefit the consumer

HISTORY Edo period

advertising flyer from 1806 for a traditional medicine called Kinseitan

Egyptians used papyrus to make sales messages and wall posters

Lost and found advertising on papyrus was common in Ancient Greece and Ancient Rome.

As the towns and cities of the Middle Ages began to grow, and the general populace was unable to read, signs that today would say cobbler, miller, tailor or blacksmith would use an image associated with their trade such as a boot, a suit, a hat, a diamond, a horse shoe or even a bag of flour.

. In the 17th century advertisements started to appear in weekly newspapers in England.

As the economy expanded during the 19th century, advertising grew alongside

An 1895 advertisement for a weight gain product.

In the early 1920s, the first radio stations were established by radio equipment manufacturers and retailers who offered programs in order to sell more radios to consumers

A print advertisement for the 1913 issue of the Encyclopædia Britannica

Presently Organizations frequently spend large sums of money on advertising

Ethical Duties of ManufacturersEthical Duties of Manufacturers

Contract TheoryContract Theory Due Care TheoryDue Care Theory Social Costs TheorySocial Costs Theory

Contract TheoryContract Theory Firm’s duties to customer created by Firm’s duties to customer created by

contract with customercontract with customer

1.Duty to comply: 1.Duty to comply: product must be safe for useproduct must be safe for use

2.Duty of disclosure:2.Duty of disclosure: disclose relevant facts disclose relevant facts3.Duty not to misrepresent3.Duty not to misrepresent: don’t mislead: don’t mislead4.Duty not to coerce4.Duty not to coerce: don’t exploit fear, stress, gullibility, : don’t exploit fear, stress, gullibility,

immaturity, or ignoranceimmaturity, or ignorance

Due Care TheoryDue Care Theory

Seller has a duty to exercise due care to protect Seller has a duty to exercise due care to protect consumers from harm consumers from harm

Seller should protect consumers by:Seller should protect consumers by: DesignDesign Choice of materialsChoice of materials Manufacturing processManufacturing process Quality controlQuality control Warnings, labels, & instructionsWarnings, labels, & instructions

Social Costs TheorySocial Costs Theory

Strict liabilityStrict liability Seller should bear all the costs when Seller should bear all the costs when

a consumer is injured by a producta consumer is injured by a product

Product price now reflects all costs, Product price now reflects all costs, including costs associated with consumer including costs associated with consumer injuriesinjuries

Seller has incentive to protect Seller has incentive to protect consumersconsumers

Costs spread across all users of Costs spread across all users of the productthe product

Ethics and Culture In history, some presidents evoke notions of truth

and honesty while some warn of the consequences of lying. Abraham Lincoln earned good name but Bill Clinton suffered impeachment.

In the same way the world of advertising has its own set of stories about the good and the bad, truth and dishonesty. This unit focuses on truth and deception in advertising and on the ethical dilemmas of those who produce advertising

What is Deceptive Advertising?

Claiming that a product can do something that it cannot is a clear-cut case of deception.

This is the picture by Nike showing the strength of their foot ball but in reality neither the footballs are so huge nor so powerful

It is ethically wrong to show something that doesn't exist

Huge ADS And Advertisement Balloons

Little children are usually amazed by certain ads because theyAre too young to understand the message in the advertisement But they understands the picture.

Air balloons are seen from large distances and are not unethicalOnly if certain type of bad pictures or bad language is on them

This kind of advertisement amaze people a lot specially the footballlovers

A wine bottle that is considered ethically wrong because the lorry may have to move to certain places where drinking is unethical

OLDTIMER advertisement is rather funny and unethical becauseSome people will have bad feelings about going inside a human body

MOVIE ADVERTISEMENTS

Movie advertisement outside cinemas are considered ethical But bad pictures on them are considered strongly unethical

In a country like Pakistan

Sports Advertising

Sport goods companies also advertise themselves .For example Olympics and football matches etc

Channel Advertisements

There is advertisements of programmes on channels as well on television

Advertisements on Internet

Advertising websites

Mock-Ups, Demonstrations, and

Simulations in Ads

Mock ups are the props instead of the real products in order to simulate the way products work . ." For example, shooting a commercial for ice cream topping would normally occur in a studio under hot lights. Under these circumstances, real ice cream would melt quickly so sometimes mashed potatoes or shaving cream is used.

EXAMPLE

The Campbell's Soup ads of the late 1960s in order to show the abundance of vegetables and noodles in the soup, the ads were shot after placing clear marbles in the bottoms of the bowls and cups, helping the vegetables stay near the top and show up clearly in the ads. The public complaint led to the discontinuation of the practice and resulted in considerable negative publicity for the company

Full Disclosure

A class action lawsuit filed against the McDonald's Corporation claimed, among other things, that the company's approach to advertising highly processed food caused obesity and other problems especially the upsize deals, but court was not convinced.In response to the negative publicity generated by the case McDonald's ads intended for children currently focus on a healthy lifestyle by showing Ronald McDonald engaged in sports and outdoor play with children. The current slogan is "It's what I eat and what I do." Full disclosure is perfect example of ETHICAL BEHAVIOUR.

False Advertising

The claims in some ads are not only often outrageous but frequently completely false. For example, the claims of the electric belt ad shown below have no basis in fact. Rather, they represent the boastful proclamations of the

seller.

EXAMPLE

In the picture it is easily seen that the advertisement of pizza is different from what it actually looks like

Misleading Ads The large grey area that exists between truth

and deception contains ads that people often consider misleading. The ads are misleading because they depart from literal truth and fact. For example, if an ad for Brand X soap claims "You can't buy a better deodorant soap than Brand X or if a company says that all the doctors world over recommend this soap like in DETOL ads. Many advertisements made claims like "4 out of 5 doctors surveyed recommend Brand Y." This became widely known as a half-truth because there was never any indication of how many doctors had been consulted. A picture of baby food ad is shown.

Impression Management An area where advertisers and marketers

must decide what is permissible (and therefore justified and ethical) is impression management. In 1975, a Delta Airlines advertisement showed a flight leaving Newark, NJ at 7:15 am and arriving in Atlanta, GA at 9:22 am, a total of 2 hours and 7 minutes. In 2007, Delta's online schedule shows a similar flight leaving Newark at 7:15 am and arriving in Atlanta at 9:38 am, a total of 2 hours and 23 minutes. Why the difference? This creates a bad impression and the company must focus on image while doing such acts .Another example is Maggi 2 minute noodles.

Harmful Products Should products that can have

harmful effects, like tobacco and alcohol, be advertised at all? Many advertising agencies respond in the affirmative. They back up their decision by saying that it is not an agency's responsibility to decide which products should be advertised and which should not. Rather, their reasoning goes: if it's legal to sell it, it's okay to advertise it. Providing kids cigarettes is unethical not only n our society but all over the world and is banned. Women smoking is unethical in some countries

There are other agencies and a handful of famous advertising men and women who refuse tobacco or alcohol accounts on ethical grounds. They do not want to be associated with the social ills of products that appear to be as harmful as these. Anti smoking ads are also given to discourage the practice.

Community Standards Ethical standards in

advertising need to take community standards into account. A single set of universal standards about what is good, bad, or just acceptable is difficult to apply everywhere. What may be appreciated in one community may be off limits in another

Road Shows and free sampling

Some companies launch road shows and free sampling for the publicity

Celebrities in ads

Famous celebrities are hired for advertisements by some companies and by using the product the customers feel themselves like those celebrities

Newspaper ads

LOGOS FOR ADVERTISING

Some well known companies only use their logos for advertising and leave it to people to

understand

Company special offers

Some companies give special offers for

publicity.

Hidden Surcharges

The most unethical practice is the hidden surcharges to deceive the customers

Advertising Billboards & Flags

Advertising to Children

Is it ethical to advertise to children?

Many People Believed that the Now-Abandoned Joe Camel CharacterAppealed to Children and Adolescents (1993)

Industry and Government

Regulation of Advertising

Advertising agencies employ lawyers to advise them on what can and what cannot be said in an ad. These lawyers are specialists in the regulation of advertising by government boards and the courts to keep in view the general ethics related to advertisement

Fake advertising

Criticism on advertising is unethical

CONCLUSION

Advertising is not unethical if its done in the right way

Thank you