Advertising Educates Consumers› Pro: Advertising informs› Con: Advertising is superficial and

intrusive

Advertising improves living standards› Pro: Ads lower the costs of products› Con: Ads are wasteful and help only

some

Is there “information” inthis ad?

Critics of advertising feel that advertising is superficial because many ads carry little actual product information. Do you think advertising is superficial?

Critics of advertising feel that advertising is superficial because many ads carry little actual product information. Do you think advertising is superficial?

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 feel advertising promotes materialism.

Critics feel advertising promotes materialism.

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 you think this ad perpetuates stereotypes?

Do you think this ad perpetuates stereotypes?

Do you think this ad perpetuates stereotypes?

Do you think this ad perpetuates stereotypes?

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.

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

Truth in Advertising

Deception is making false or misleading statements, but puffery (commercial exaggeration) is legal.

Cannot legislate against emotional appeals

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?

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?

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

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

FTC Programs and Remedies Advertising Substantiation Program

Affirmative Disclosure

Consent Order– Cease and Desist Order– Affirmative Disclosure

Corrective Advertising

Control of Celebrity Endorsements

Industry Self-Regulation National Advertising Review Board

(NARB)

State and Local Better Business Bureaus

Ad Agencies and Associations

Media Organizations

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

Consumers as Regulatory agents Consumerism: Grass roots consumer

movements

Consumers Organizations– Consumer Federation of America– Consumers Union– Consumer Alert– Commercial Alert

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)