L12 - Social, Ethical and Regulatory Aspects of Advertising

Question 1

Concerns about Advertising:

Answer 1

1. Overemphasizes materialism
2. Increases the costs of goods and services.
3. Perpetuates stereotypes
4. Makes unsafe products, such as alcohol and tobacco, seem attractive.
5. Often offensive.
6. Advertising to children is unethical.
7. Misleading and deceptive advertising

Question 2

Advertising and Society:

Answer 2

• Marketing communication is intimately connected with the social and cultural environment
• Advertising is a powerful source with potential to offend
• Marketers must often make decisions about what is appropriate
• Marketers must consider the social, legal and regulatory issues that affect their activities

Question 3

The Shape-Versus-Mirror Debate:

Answer 3

Does advertising create a materialistic culture or does it simply reflect it?

• Critics believe that advertising has the power to shape trends and the way people think
• Advertisers believe advertising mirrors values rather than sets them

Advertising can potentially shape and mirror values

Question 4

Ethics and Law:

Answer 4

• Ethics are moral principles and values that govern the actions and decisions of an individual or group.
• Laws are formal, codified rules that are recognised as binding on a community.

Activities that are lawful may not be ethical!

Question 5

Ethical Issues in Advertising:

Answer 5

• Brand infringement
• Medical marketing
• Gifts and bribery
• Spamming and cookies
• Targeting vulnerable markets
• Privacy

Question 6

Two perspectives…..

Answer 6

Question 7

Poor Taste and Offensive Advertising:

Answer 7

A personal issue and creating guidelines is difficult

Question 8

Portrayal of People:

Answer 8

A stereotype represents a cultural groups’ trait or traits in a way that may or may not be accurate; it may shape or reinforce a cultural value

Question 9

Sex, Sexuality and Nudity:

Answer 9

Advertising that portrays women or men as sex objects may offend

Question 10

Diversity Issues:

Answer 10

The portrayal of society should be accurate and representative of society

Question 11

Gender Roles:

Answer 11

The way women and men are cast as characters in adverts and programs can create or reinforce cultural stereotypes

Question 12

Racial and Ethnic Stereotypes:

Answer 12

Inclusion of certain races and ethnic groups in advertising is rare

Question 13

Age Discrimination:

Answer 13

Two groups subject to stereotyping are baby boomers and seniors, often portrayed negatively

Question 14

Violence:

Answer 14

This includes startling images and shock tactics

Question 15

Targeting Children:

Answer 15

This is a most controversial topic with serious issues such as promoting unhealthy lifestyles in advertising food and beverages

Question 16

Language and Vulgarity:

Answer 16

This may include swearing, inappropriate language and blasphemy

Question 17

Health and Safety:

Answer 17

Views are influenced by events in society e.g. glorification or glamorous looks in men and women, very thin models and showing muscular bodies that can only be acquired in reality by the use of steroids

Question 18

Advertising to children - 2 views:

Answer 18

Question 19

Advertising, children and regulations:

Answer 19

There are specific rules for advertising to children: the Children’s Television Standards (CTS) and the AANA Code for Advertising to Children, which recognises the special consideration needed for presenting material which may be harmful to children.

The Australian Communications and Media Authority (ACMA) has strict guidelines:-

• advertising banned on preschool programs
• no alcohol advertising
• restrictions on prizes and competitions
• the number of times a commercial can be broadcast during children’s programs

Question 20

Regulatory aspects:

Answer 20

Advertising is controlled through laws and regulations.

Laws are formal, codified rules recognised as binding on a community.

Regulations are internal rules governing the behaviour of groups.

Regulation is difficult and controversial, so a self-regulatory approach is common in developed countries.

In Australia, advertising is regulated by a number of bodies and groups that reflect the interests of government, media, industry, public and community groups and the competition.

Question 21

Advertising’s Self-Regulation:

Answer 21

In Australia advertising is governed by a system of self-regulation.

Self-regulation is also known as co-regulation or quasi-regulation.

Key agencies involved include:

• peak industry associations
• government agencies
• members of the public.

Self-Discipline

• Most advertisers and agencies have in-house review procedures
• Every element of a proposed ad should be evaluated by an in-house committee or lawyers

Public and Media Review

• Consumer groups such as the Australian Consumers Association
• Feminist Underground Guerrilla Group
• High-profile or vociferous experts
• The media try to regulate advertising; the free-to-air networks have a Commercial Television Industry Code of Practice

Question 22

Benefits of self-regulation:

Answer 22

From advertising industry perspective:

• A more flexible approach
• Responsive to both industry needs and public opinion
• Limits government interference

From government perspective:

• Costs of administration and enforcement are borne by the industry rather than government

Question 23

Industry self-regulation in Australia:

Answer 23

Question 24

Advertising’s Legal Environment:

Answer 24

Australia Competition and Consumer Commission (ACCC).

Consumer and Competition Act 2010 (formerly the Trade Practices Act 1974).

• Penalties for misleading or deceptive advertising include injunctions, damages, corrective advertising, advertisement recall.
• In questions of liability, agencies and advertisers are liable for deceptive advertising.

Question 25

Levels of advertising regulation:

Answer 25

Question 26

Appraising self-regulation:

Answer 26

Industry viewpoint

• Mature industries should be entitled to regulate themselves
• An effective mechanism
• Has led to more stringent standards

Critics’ viewpoint

• Lengthy delays resolving complaints
• Mechanism lacks power and authority
• Voluntary compliance difficult to enforce

Question 27

Unfair and Deceptive Practices:

Answer 27

An advertisement or communication is deceptive or misleading if:

• A substantial number of people or typical person is left with false impression or misrepresentation.
• The misrepresentation induces people or the typical person to make a purchase.
• Greenwashing – claiming or implying benefits to the environment which the product or service does not actually have.

Question 28

Deception versus Puffery

Answer 28

Puffery

• An exaggerated statement
• Not factual statement

Claim is a factual statement

Puffery statements include

• Best, greatest, and finest
• Better – puffery or claim?

Question 29

Consumer Privacy:

Answer 29

• Direct mail: targeting, volume, permission and compensation
• The internet: Gathering information from searches and purchases, hacking, on selling of data, use of hidden cookies
• Mobile phones
• Database marketing and mining
• Neuromarketing

Question 30

Ethical Issues: sponsorship

Answer 30

Using sponsorship to circumvent advertising regulation

• The exception of sporting events
• Experiential reach to vulnerable markets
• Social media activation

Marketing of ‘sin’ products through sponsorship-alcohol, gambling and junk food

Question 31

Alcohol Sponsorship :

Answer 31

• Alcohol sponsorship of sport is a public policy issue worldwide
• National Research Priorities-Preventative Health
• Recommendations by Federal government to ban sponsorship of sport by alcohol brands
• Vulnerable targets including youth and sportspeople are of key concern
• Estimated cost of $300 million to the sports industry

Question 32

Alcohol sponsorship - Regulations:

Answer 32

Industry code ABAC-Alcohol beverages advertising code

E.g.,Advertisements for alcohol beverages must

• present a mature, balanced and responsible approach to the consumption of alcohol beverages and, accordingly –
  
  • i) must not encourage excessive consumption or abuse of alcohol;
  • ii) must not encourage under-age drinking
  • iii) must not promote offensive behaviour, or the excessive consumption, misuse or abuse of alcohol beverages
  • iv) must only depict the responsible and moderate consumption of alcohol beverages

Advertising times; sporting events are an exemption

Content of current leveraged ads by alcohol sponsors

• b) not have a strong or evident appeal to children or adolescents
• c) not suggest that the consumption or presence of alcohol beverages may create or contribute to a significant change in mood or environment and, accordingly –
  
  • i) must not depict the consumption or presence of alcohol beveragesas a cause of or contributing to the achievement of personal,business, social, sporting, sexual or other success;
  • ii) if alcohol beverages are depicted as part of a celebration…..