85361622 Ethics and Laws in Advertising in India

8/10/2019 85361622 Ethics and Laws in Advertising in India

1/18

Ethics and Laws of Advertising in Indiaby:- Akash Jindal

729

MBA 4th


2/18

Ethics in Advertising

Is it ethical to advertise cigarettes or

to engage in alcohol advertising, which

might persuade young people to start

smoking and drinking?

Advertising famous personalities,

animals, human beings, social

elements etc. in wrong manner


3/18


Many laws and regulations are put into force

that determines what is permissible in

advertising

However, every issue is not controlled by rulesMarketers are often faced with decisions

regarding appropriateness of their actions,

which are based on ethical considerations

rather than what is within the law or industry

guidelines

Certain actions may be within the law but stillunethical


4/18

Ethical Issues in Advertising

1. Using unnecessary sex appeal or

showing women inadvertisements immorally

without purpose

2. Making false claims about the

product with hidden tactics

3. Criticizing or dishonoring anythingwhich is in real of some honor to the

society

4. Criticizing the competitors

product by any similar name or any

other matching


5/18

Ethical Issues in Advertising

5. Pointing out human formulation such as

black and fair complexion comparison etc.

6. Delivering confusing and misleadinginformation

7. Showing infeasible and unnatural things or

actions that are shown as a result of using the

product

8. Advertising intoxicating products like wine,

cigarette, tobacco etc.


6/18



7/18

False or Deceptive Advertising

False claims about products , when

made in advertisements destroy publicfaith in advertising

Advertising containing false statements

amounts to deception

Conceptually, deception exists when an

advertisement is introduced into the

perceptual process of some audienceand the output of that perceptual

process (i) differs from the reality of the

situation, and, (ii) affects buying

behavior to the detriment of the

consumer


8/18

False or Deceptive Advertising

The definition of Deceptive

Advertisement or False Advertisement

was given in the Wheeler- Lea Act ofUSA as follows:

The term false advertisement means

an advertisement other than labeling,

which is misleading in a material

respect; and in determining whether any

advertisement is misleading, there shallbe taken into account (among other

things) not only representations made

or suggested by statement, word,

design, device, sound or any

combination thereof, but also the extent

to which the advertisement fails toreveal facts material in the light of such

representations or material with the

commodity to which the advertisement

relates under conditions prescribed in

said advertisement, or under such

conditions as are customary or usual


9/18

Legal Restrictions on Advertising

There are 3 major institutions in the society that

protect consumers against misleading orfraudulent advertising:

1. Government agencies enforcing laws against

offenders

2. Advertising industry associations and media

groups that impose self regulation upon their

member firms and advertisers3. Advertisers themselves acting through

enlightened self- interest and a sense of social

responsibility


10/18


The Federal Trade Practices Act as passed by the

Federal Congress in 1890 has declared dealing

with unfair methods of competition incommerce and unfair or deceptive acts or

practices in commerce to be unlawful. The Act

added:

a. It shall be unlawful for any person, partnership

or corporation to disseminate or cause to be

disseminate any false advertisement-i. By mails or in commerce by any means for the

purpose of inducing or which is likely to induce

directly or indirectly the purpose of food,

drugs, devices or cosmetics, or

ii. By any means for the purpose of inducing or

which is likely to induce directly or indirectlythe purchase of food, drugs, devices, or

cosmetics

b. The dissemination or the causing to be

disseminated of any false advertisement within the

provision of sub section (a) of this section shall be

an unfair or deceptive act or practice in commerce


11/18


Sachar Committee has recommended the

following acts of sellers as Unfair TradePractices:

1. Misleading advertisements and false

representation- A seller should not falsely

represent that-

a. The goods are of a particular standard,

quality, grade composition, style or model,if they do not possess that qualification

b. The rebuilt, second- hand goods are new

goods

2. Offering of gifts or prizes with the

intention of not providing them and

conducting professional contests

The committee is of the opinion that all the

aforesaid unfair trade practices should be

punishable as an offence or any person on

undertaking indulging in any of these

activities should be liable to be prosecuted

before the commission


12/18


Advertising Standards Council of India (ASCI)

In order to enforce an ethical code, India has theAdvertising Standards Council of India (ASCI)

It is a non- profit organization set up by 43

founder members who are involved with

advertising in one way or the other

It was established in 1985

Its Board of Members has members withequitable representation to advertisers,

agencies, media and others

It puts forward a regulating code

ASCI proposes to adjudicate on whether an

advertisement is offensive and its decision will

be binding on its members It proposes to deal with the government if there

are any disputes

It seeks to achieve the acceptance of fair

advertising practices in the best interest of the

ultimate consumer


13/18


14/18

Corrective Advertising

Corrective Advertising requires advertisers to rectify past deception

by making suitable statements in future commercials

The 1975 corrective advertising order against Warner- LambertsListerine is a classic example

Listerine has advertised for over fifty years that gargling with

Listerine mouthwash helped prevent colds and sore throats by

killing germs

The order required them to include the statement, Listerine will

not help prevent colds or sore throats or lessen their severity in$10 million of advertising, which was equal to the average annual

Listerine expenditure during the prior ten- year period

Listerine implemented the order by embedding the statement in a

commercial featuring two couples, each with a husband finding

himself having onion breath

The corrective disclosure appeared mid- way in the thirty- secondspot as follows:

While Listerine will not help prevent colds or sore throats or lessen

their severity, breath tests prove Listerine fights onion breath better

than Scope(a rival mouthwash brand for Listerine)

Refer Page 671 to 675 of Myers and Aaker Text for remedies

against Deceptive Advertising


15/18

Is Advertising a waste of money?

It is logical to think that if advertising

adds value to products or services, it

also adds cost and affects prices.

This view is not totally correct.

While some advertised products do

cost more than the unadvertisedproducts, the opposite is also true.

Advertising may help lower the overall

cost of a product more than enough to

offset costs and keep the prices down

because of economies of scale in

production and by encouragingcompetition


16/18

Guidelines for Advertising

1. Truth: Advertising shall reveal the truth, and shall

reveal significant facts, the omission of whichwould mislead the public

2. Substantiation: Advertising claims shall be

substantiated by evidence in possession of the

advertiser and the advertising agency prior to

making such claims

3. Comparisons: Advertising shall refrain frommaking false, misleading, or unsubstantiated

statements or claims about a competitor or his

products or services

4. Bait Advertising: Advertising shall not offer or

services for sale unless such offer constitutes a

bona fide effort to sell the advertised products orservices and is not a device to switch consumersto other goods or services, usually higher priced


17/18

Guidelines for Advertising

5. Guarantees and Warrantees: Advertising of

guarantees and warrantees shall be explicit, with

sufficient information to apprise consumers oftheir principal terms and limitations or, when

space or time restrictions preclude such

disclosures, the advertisement shall clearly reveal

where the full text of the guarantee or warranty

can be examined before purchase

6. Price claims: Advertising shall avoid price claimsthat are false or misleading, or savings claims that

do not offer provable savings

7. Testimonials: Advertising containing testimonials

shall be limited to those of competent witnesses

who are reflecting a real and honest opinion or

experience8. Taste and decency: Advertising shall be free from

statements, illustrations, or implications that areoffensive to good taste or public decency


18/18

85361622 Ethics and Laws in Advertising in India

Documents

Transcript of 85361622 Ethics and Laws in Advertising in India