E3, Ch 14B: Consumer Stakeholders Flashcards
where does advertising issues cross ethical into legal?
ambiguity
ex. “helps” you look younger
where does advertising issues cross ethical into legal?
exaggerated claims
ex. Coca-Cola falsely claimed Vitaminwater products could promote healthy joints and reduce eye disease
where does advertising issues cross ethical into legal?
psychological appeals
ex. home security salespeople call homeowners in areas with recent break-ins
comparative advertising
practice of directly comparing a firm’s product to a competitor (Mac versus PC, Coke versus Pepsi) – legal if claim can be proven
concerning the use of sex appeal in advertising…
is it ethical for advertisers to target young girls to diet and get hair extensions?
the average child seeks __k-__k ads per year
25k-40k
age compresion
marketing to 8-yr olds products that are meant for teenagers
marketing to the poor
ex. high interest rates yield significant profits but can bury the poor in debt
Although, according to HBS, marketing to the poor can play a huge role in…
alleviating global poverty
advertising alcohol 1936 and 1996
1936 - first US ban on hard alcohol advertising, 3 years after the end of prohibition
1996 - advertising returns
70% over 21 rule
for an alcohol company to place an ad, 70% of audience must be 21+
cigarette advertising
per WHO, cigarette only legal product that kills half its regular users when consumed as intended by manufacturers
Tobacco Control Act, 2009 (3)
- restricts marketing and sales to youth
- requires smokeless tobacco products to carry warning label
- requires disclosure of ingredients in tobacco products
controversy behind health and environmental claims
ads may include health and environmental claims, but are they verifiable? (ex. Saying “healthier”)
Estimated prescription and over the counter drug ads account for ____ of spending in 2024 on five popular nightly news shows
half
(these shows cannot refuse to lose these advert $ so do not report on negative side effects on the drugs in which they are allowing to be advertised)
Americans are “…biggest consumers of _________ products in the world” - RFK
The issue – to limit truthful, misleading, commercial ads will likely be…
pharmaceutical
…challenged from drugmakers on First Amendment grounds
RFK wants to ban…
prescription drug advertising
deep fake advertising
when media has been digitally manipulated to replace one person’s likeness convincingly with that of another
warranties and guarantees (2)
- initially used by manufacturers to limit the length of time they were responsible for products
- viewed by consumers as protection against defective products
Magnuson-Moss Warranty Act, 1975
set standards for what must be contained in a warranty and its ease of being understood; it defines
- implied warranty
- express warranty
- guarantee
implied warranty
unwritten promise that there is nothing wrong with the product and its intended use
express warranty
explicitly offered at time of sale
guarantee
a promise regarding product quality, less likely to be written
Federal Packaging and Labeling Act, 1967 requires (3)
- Statement of Identity
- Net Quantity of Contents
- Name and Place of Business
