In Advertising

The competitive drive to develop the most effective attention-grabbing messages possible

The fear of crossing the line beyond what is legal, ethical, and socially acceptable

Marketers encounter constant tension between:

Ethics

Ethics: Moral and value standards that act as behavioral guidelines for a

society’s citizens

•Unlike laws and regulations, ethical codes are generally not written down

Ethics in Advertising and Promotion

Not all issues can be regulated

A marketing or promotion action may be legal but not ethical

Marketers must decide the appropriateness of their actions

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

Children Elderly

MinoritiesDeveloping Countries Minorities

ElderlyChildren

Targeting Vulnerable Groups

TargetingVulnerable

Groups

Offensive Messages

Marketers have a range of creative options for their

messages—each with a trade-off

Attention-grabbing—but

controversial, maybe offensive

Safe but boring

Questionable B2B Practices

Puffery

Commercial Free Speech

Misleading Claims

Fraud

Questionable B2B Practices

Puffery

Misleading Claims

Commercial Free Speech

What Legal Issues Relate to MC

LegalIssues

National Advertising

Division

National Advertising

Review Council

Better Business Bureau

Children’s Advertising Review unit

National Advertising

Review Board

National Advertising

Division

National Advertising

Review Council

Children’s Advertising Review Unit

Better Business Bureau

Industry Self-Regulation Groups

RegulatingGroups

Federal Trade Commission

Patent and Trademark

Office

State and Local Regulations

Foreign Regulations

State and Local Regulations

Patent and Trademark

OfficeFederal Trade Commission

Government Oversight

GovernmentOversight

Approval Processes

Corporate Ethical Standards

Social Marketing

Corporate Ethical Standards

Approval Processes

Managing These Issues Is Complex

ManagingIssues

Advertising and Untruthful or Deceptive

General mistrust of advertising among consumers. Many do not perceive ads as honest or believable

Abuses involving sales promotions such as contests, sweepstakes, premium offers

Unethical and/or deceptive practices involving mail order, telemarketing and other forms of direct marketing

Internet scams and abuses

Advertising and Children

Children's TV Watching Behavior

Children ages 2-11 watch an average of 22 hours of TV per week and see 30,000 commercials per year

80% of all advertising targeted to children falls in fourproduct categories:Toys, cereal, candy & fast food restaurants

Perspectives on Ads for Children

Advocates Argue That Children:

Marketers Argue Children:

Lack the knowledge and skills to evaluate advertising claims

Cannot differentiatebetween programs and commercials

Must learnthrough socialization

Must acquire skills needed to function in the marketplace

Social and Cultural Consequences

Does advertising encourage materialism?

Does advertising make people buy thingsthey don’t need?

Is advertising justa reflection of society?

Dove Challenges the Norms of Beauty

Economic Impact of Advertising

Effects on Consumer Choice• Differentiation • Brand Loyalty

Effects on Product Costs and Prices• Advertising as an expense that increases the

cost of products• Increased differentiation

Effects on Competition• Barriers to entry • Economies of scale

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.”

Excerpters is from a speech given by Leo Burnett on the American Association or Advertising Agencies’ 50th anniversary, April 20,1967

Why ‘Ethical’ Advertising?

Not to hurt sentiments of the society Maintain a code of conduct Avoid misrepresentation Adhere with social norms Social acceptance Helps in image building