GNI INT SEMINAR

8/7/2019 GNI INT SEMINAR

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“ETHICAL ADVERTISING IN FMCG INDUSTRY”

“ Ethical Advertising In FMCG Industry”

Mr. Anil Kumar , School of Management Studies, Punjabi University,Patiala(9464532833)

Email id: anilgautam1188@gmailcom

ABSTRACT

Advertising Ethics is part of basic ethics in action series. It is an applied philosophicalanalysis of the nature of advertising in general and of specific ethical issues that arise inadvertising. Ethics have always been an important aspect of every business activity, althoughthe term has meant different things at different times in different lands to different people.Nonetheless, as ethical concerns are an inseparable element of business, advertising cannotignore them. Sadly, the advertising industry has rarely cared to look beyond immediate

marketing objectives. The argument in the industry is that it is the government's job to judgewhat is right and what is wrong. Shirking its own responsibility for regulation, the industryhas belittled business values and agencies have harmed their balance sheets.

For any business, customer is very important, and businessman attempt to communicate to alltheir target customers using means of communication like advertising and sales promotion.Advertising is a very powerful and most commonly used tool. Advertising is the attempt tosend information to people to convince them to spend their money with a certain company.This concept is the foundation of much of the modern financial world. The ads can attack anyof the senses. Sight, hearing, touches even smell or taste..

Advertising is a mirror that helps shape the realty it reflects, and sometimes it presents adistorted image of reality. Advertising has a powerful impact on the society through itsinfluence on media. Many publications and broadcasting operations depend on advertisingrevenue for survival. This dependency compels the media to telecast unrealistic and unethicalads.

Reputable companies and advertising agencies avoid telling lies. They realize the cost of being caught. A dent in trust can prove to be much costlier than the failure of an ad campaignor for that matter, even a brand. The challenge before advertisers and agencies is to ensurethat ads reflect our values.

We must endeavour to see that "advertising" does not remain a dirty word. Advertising is notunethical if it’s done in the right way.

ETHICS IN ADVERTISING

Advertising Ethics is part of basic ethics in action series. It is an applied philosophicalanalysis of the nature of advertising in general and of specific ethical issues that arise inadvertising. Ethics have always been an important aspect of every business activity, althoughthe term has meant different things at different times in different lands to different people.Nonetheless, as ethical concerns are an inseparable element of business, advertising cannot

ignore them. Sadly, the advertising industry has rarely cared to look beyond immediatemarketing objectives. The argument in the industry is that it is the government's job to judge

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what is right and what is wrong. Shirking its own responsibility for regulation, the industryhas belittled business values and agencies have harmed their balance sheets.

For any business, customer is very important, and businessman attempt to communicate to alltheir target customers using means of communication like advertising and sales promotion.

Advertising is a very powerful and most commonly used tool. Advertising is the attempt tosend information to people to convince them to spend their money with a certain company.This concept is the foundation of much of the modern financial world. The ads can attack anyof the senses. Sight, hearing, touches even smell or taste. For example movie popcorn has aspecific smell that's been refined over years to entice others in the movie theater to buy their own large bucket. Advertising is big business. Billions of dollars are spent each month onadvertising. Many industries exist solely due to the influx of money advertising brings in. Thecable TV industry, magazines, newspapers and many other media and non-media industrieswould be drastically changed if they couldn't sell advertising space.

Plus we wouldn't know what to buy. Because of these facts, companies try all sorts of tactics

to get our attention and money. Sometimes these attempts involve illegal, underhanded or dirty tricks. Advertising consist of the activities by which messages are addressed to selectedpublic for the purpose of informing and motivating them to buy the product or services or toact positively toward ideas, persons, trademark, place and events. The social and ethicaleffects of advertising have become a major issue in India as well as in other parts of world.However, those people who have realized and understand the technical and economicbenefits of advertising criticize the ethics of advertising. Ethics is a set of moral principlesnorms or values. It is a part of social science dealing with good and bad and hence moralduties and responsibilities of an individual as social and rational animal. In other words,ethics is concerned with those values that determine the moral conduct in a given group or community. What is the relationship between advertising and these terms namely, ethics and

morality? It is fact that advertising is psychological social and business process of persuadingthe people to buy products or services. In the process of acute and cut –throat competition,there are chances of discounting truth to succeed in the art of making multiplied sales andprofits. Advertising has also been misused by a few people to serve their own ends,overlooking the business interests. There are various aspects of ethics, ranging from thequestion of validity of claims made in advertisements to form and made of presentation.

The impact of advertising on children is a subject which has aroused a lot of interest in recentyears and considerable research is being undertaken in several countries. Advertising hasbeen criticized for degrading the ethical values of society. It has to protect these values andmotivate people with a realistic approach. The imaginary creations and valueless advertising

should be avoided by the advertisers.

Imaginative Creation – Advertising has been presenting imaginary and emotional views of consumers. The smoking girl inviting people to smoke and share her emotion often has oncorrespondence with reality. But such kinds of ads have been used by advertisers to attractpeople. Therefore there is need to bring improvement of such kind of ads. These kinds of practices should be abolished.

Value systems- Advertisers have not been careful about presenting life styles and valuestyles. Obscenity and nudity are example of the deteriorating values of adverting. Gamblingand lotteries should not be promoted by advertisings because they have destroyed the basic

values of society. Excessive advertising may be intrusive and create confusion in the mindsof prospects.

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Unethical advertising: Advertisement is considered unethical in the following situations;

• When it has degraded or underestimated the substitute or rival's product.

• When it gives false or misleading information on the value of the product.

• When it fails to give useful information on the possible reaction or side effects of theproduct. And

• When it is immoral.

Arguments favoring Advertising:-

Provides information.

Encourages a higher standard of living.

Creates jobs and helps new firms enter a market.

Promotes competition in the marketplace.

Arguments against Advertising:-

Creates needs and wants among consumers.

Is more propaganda than information.

Promotes materialism, insecurity and greed.

SOME ETHICAL AND MORAL PRINCIPLES

"If the media are to be correctly employed, it is essential that all who use them know theprinciples of the moral order and apply them faithfully in this domain." The moral order towhich this refers is the order of the law of human nature, binding upon all because it is"written on their hearts" and embodies the imperatives of authentic human fulfillment.

For Christians, moreover, the law of human nature has a deeper dimension, a richer meaning."Christ is the Beginning' who, having taken on human nature, definitively illumines it in itsconstitutive elements and in its dynamism of charity towards God and neighbor." Here wecomprehend the deepest significance of human freedom: that it makes possible an authenticmoral response, in light of Jesus Christ, to the call "to form our conscience, to make it theobject of a continuous conversion to what is true and to what is good."

In this context, the media of social communications have two options, and only two. Either they help human persons to grow in their understanding and practice of what is true andgood, or they are destructive forces in conflict with human well being. That is entirely true of advertising.

Against this background, then, we point to this fundamental principle for people engaged inadvertising: advertisers that is, those who commission, prepare or disseminate advertising are morally responsible for what they seek to move people to do; and this is a

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responsibility also shared by publishers, broadcasting executives, and others in thecommunications world, as well as by those who give commercial or political endorsements,to the extent that they are involved in the advertising process.

If an instance of advertising seeks to move people to choose and act rationally in morally

good ways that are of true benefit to themselves and others, persons involved in it do what ismorally good; if it seeks to move people to do evil deeds that are self-destructive anddestructive of authentic community, they do evil.

This applies also to the means and the techniques of advertising: it is morally wrong to usemanipulative, exploitative, corrupt and corrupting methods of persuasion and motivation. Inthis regard, we note special problems associated with so-called indirect advertising thatattempts to move people to act in certain ways for example, purchase particular products without their being fully aware that they are being swayed. The techniques involved hereinclude showing certain products or forms of behavior in superficially glamorous settingsassociated with superficially glamorous people; in extreme cases, it may even involve the use

of subliminal messages.

Within this very general framework, we can identify several moral principles that areparticularly relevant to advertising.

a) Truthfulness in Advertising

Even today, some advertising is simply and deliberately untrue. Generally speaking, though,the problem of truth in advertising is somewhat more subtle: it is not that advertising sayswhat is overtly false, but that it can distort the truth by implying things that are not so or withholding relevant facts. On both the individual and social levels, truth and freedom are

inseparable; without truth as the basis, starting point and criterion of discernment, judgment,choice and action, there can be no authentic exercise of freedom. To be sure, advertising, likeother forms of expression, has its own conventions and forms of stylization, and these mustbe taken into account when discussing truthfulness. People take for granted some rhetoricaland symbolic exaggeration in advertising; within the limits of recognized and acceptedpractice, this can be allowable.

But it is a fundamental principle that advertising may not deliberately seek to deceive,whether it does that by what it says, by what it implies, or by what it fails to say. "The proper exercise of the right to information demands that the content of what is communicated be trueand, within the limits set by justice and charity, complete. ... Included here is the obligation to

avoid any manipulation of truth for any reason."

b) Advertising and Social Responsibility

Social responsibility is such a broad concept that we can note here only a few of the manyissues and concerns relevant under this heading to the question of advertising.

The ecological issue is one. Advertising that fosters a lavish life style which wastes resourcesand despoils the environment offends against important ecological concerns. "In his desire tohave and to enjoy rather than to be and grow, man consumes the resources of the earth andhis own life in an excessive and disordered way. ... Man thinks that he can make arbitrary use

of the earth, subjecting it without restraint to his will, as though it did not have its own

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requisites and a prior God-given purpose, which man can indeed develop but must notbetray."

As this suggests, something more fundamental is at issue here: authentic and integral humandevelopment. Advertising that reduces human progress to acquiring material goods and

cultivating a lavish life style expresses a false, destructive vision of the human personharmful to individuals and society alike.

When people fail to practice "a rigorous respect for the moral, cultural and spiritualrequirements, based on the dignity of the person and on the proper identity of eachcommunity, beginning with the family and religious societies," then even material abundanceand the conveniences that technology makes available "will prove unsatisfying and in the endcontemptible."30 Advertisers, like people engaged in other forms of social communication,have a serious duty to express and foster an authentic vision of human development in itsmaterial, cultural and spiritual dimensions.

c) Decency

Advertisements should not contain statements or visual presentations which offend prevailingstandards of decency

d) Honesty

Advertisements should be so framed as not to abuse the trust of consumers or exploit their lack of experience or knowledge.

e) Comparisons

Advertisements containing comparisons should be so designed that the comparison is notlikely to mislead, and should comply with the principles of fair competition. Points of comparison should be based on facts that can be substantiated and should not be unfairlyselected.

f) Portrayal or imitation of personal property

Advertisements should not portray or refer to any persons, whether in a private or a publiccapacity, unless prior permission has been obtained; nor should advertisements without prior permission depict or refer to any person's property in a way likely to convey the impressionof a personal endorsement.

g) Exploitation of goodwill

Advertisements should not make unjustifiable use of the name, initials, logo and/or trademarks of another firm, company or institution nor should advertisements in any way takeundue advantage of another firm, person or institution's goodwill in its name, trade name or other intellectual property, nor should advertisements take advantage of the goodwill earnedby other advertising campaigns.

h) Identification of advertisements

Advertisements should be clearly distinguishable as such, whatever their form and whatever the medium used; when an advertisement appears in a medium which contains news or

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editorial matter, it should be so presented that it will be readily recognized as anadvertisement.

i) Safety and health

Advertisements should not without reason, justifiable on educational or social grounds,contain any visual presentation or any description of dangerous practices or of situationswhich show a disregard for safety or health.

THE FMCG INDUSTRY IN INDIA

Fast Moving Consumer Goods (FMCG) goods are popularly named as consumer packagedgoods. Items in this category include all consumables (other than groceries/pulses) peoplebuy at regular intervals. The most common in the list are toilet soaps, detergents, shampoos,toothpaste, shaving products, shoe polish, packaged foodstuff, and household accessoriesextends to certain electronic goods.

These items are meant for daily of frequent consumption and have a high return.The Indian FMCG sector is an important contributor to the country’s GDP. The FMCG sector is the fourth largest sector of Indian economy.

The FMCG market is estimated to treble from its current figure in the coming decade.The Indian FMCG sector is the fourth largest sector in the economy with a total market sizein excess of $13.1 billion. It has a strong MNC presence and is characterized by a wellestablished distribution network, intense competition between the organized and unorganizedsegments and low operational cost. Availability of key raw materials, cheaper labor costs andpresence across the entire value chain gives India a competitive advantage.

The FMCG market is set to treble from $11.6 billion in 2003 to $33.4 billion in 2015.Penetration level as well as per capita consumption in most product categories like jams,toothpaste, skin care, hair wash etc. in India is low indicating the untapped market potential.Burgeoning Indian population, particularly the middle class and the rural segments, presentsan opportunity to makers of branded products to convert consumers to branded products.Growth is also likely to come from consumer 'upgrading' in the matured product categories.With 200 million people expected to shift to processed and packaged food by 2010, Indianeeds around $28 billion of investment in the food-processing industry.

In this year when almost all the stocks have been tumbled heavily on the Dalal Street, the one

sector which completely outperformed the market is FMCG. During last 52 weeks theSENSEX has lost by around 53%, while BSE FMCG has just lost by below 10%.

Sensex witnessed strong bull market journey with almost 7 fold gains from 3000 in 2003 to21000 in 2008, the FMCG did not match the Index equivalently but managed to follow thetrend by almost 3.5 times gain for the same period. Now in a bear market scenario, theFMCG is bucking the trend which is a big sign of relief for investors. Hence I believe FMCGis strong and defensive sector and one should consider this sector for his portfolio andallocate some portion for it.

HUL led the way in revolutionizing the product, market, distribution and service formats of

the FMCG industry by focusing on rural markets, direct distribution, creating new product,distribution and service formats. The FMCG sector also received a boost by government led

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initiatives in the 2003 budget such as the setting up of excise free zones in various parts of thecountry that witnessed firms moving away from outsourcing to manufacturing by investing inthe zones.

Though the absolute profit made on FMCG products is relatively small, they generally sell in

large numbers and so the cumulative profit on such products can be large. Unlike someindustries, such as automobiles, computers, and airlines, FMCG does not suffer from masslayoffs every time the economy starts to dip. A person may put off buying a car but he willnot put off having his dinner.

Unlike other economy sectors, FMCG share float in a steady manner irrespective of globalmarket dip, because they generally satisfy rather fundamental, as opposed to luxurious needs.The FMCG sector, which is growing at the rate of 9% is the fourth largest sector in the IndianEconomy and is worth Rs.93000 crores. The main contributor, making up 32% of the sector,is the South Indian region. It is predicted that in the year 2010, the FMCG sector will beworth Rs.143000 crores. The sector being one of the biggest sectors of the Indian Economy

provides up to 4 million jobs.

TYPES OF FMCG COMPANIES

The FMCG sector consists of the following categories:

1. PERSONAL CARE

o Oral care, Hair care, Wash (Soaps), Cosmetics and Toiletries, Deodorants and

Perfumes, Paper products (Tissues, Diapers, Sanitary products) and Shoe care.

o

The major players being; Hindustan Lever Limited, Godrej Soaps, Colgate,Marico, Dabur and Procter & Gamble.

2. HOUSEHOLD CARE

o Fabric wash (Laundry soaps and synthetic detergents), Household cleaners

(Dish/Utensil/Floor/Toilet cleaners), Air fresheners, Insecticides and Mosquitorepellants, Metal polish and Furniture polish.

o The major players being; Hindustan Lever Limited, Nirma and Ricket

Colman.

3. BRANDED AND PACKAGED FOODS AND BEVERAGES

o Health beverages, Soft drinks, Staples/Cereals, Bakery products (Biscuits,

Breads,Cakes), Snack foods, Chocolates, Ice-creams, Tea, Coffee, Processedfruits, Processed vegetables, Processed meat, Branded flour, Bottled water,Branded rice, Branded sugar, Juices.

o The major players being; Hindustan Lever Limited, Nestle, Coca-Cola,

Cadbury, Pepsi and Dabur

4. SPIRITS AND TOBACCO

o The major players being; ITC, Godfrey, Philips and UB

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CORPORATE SOCIAL RESPONSIBILITY

FMCG companies have now started taking Corporate Social Responsibility seriously. For instance, to encounter domestic violence, Ponds has tied up with the United NationsDevelopment Fund (UNDF) for Women. Surf Excel is funding the education of children.

Most brands link themselves with the social causes, thereby linking consumers with thebrands and gaining goodwill in the market

ETHICS OF ADVERTISING IN FMCG INDUSTRY

Now a days advertising is important for all products or services which also includes FMCGproducts. Thus ethics plays a major role for these products. Ethics of advertising in FMCGincludes some key concepts such as:

• Don't touch your customer beliefs.

•

Don't cheat your potential customer.

• Don't harm you customer feelings.

• Don't treat your customers like a crazy man, "making smoking Ad thentelling him enjoy the healthy body with less Nicotine"

SOME ETHICAL ISSUES

Ads for reputable companies almost never lie. They have to be able to prove what they say totheir own corporate counsel, the ad agency's lawyers, the network's approval committees and

to any number of regulating bodies like the FDA and the FTC. With at least five differentgovernment agencies looking over our shoulder, the cost of being caught cheating is simplytoo high. So these companies tell the truth -- but not always the Whole Truth. Like lawyers,their job is to put clients in the best light. When you go on a job interview or a first date, youdon't assume a false identity - but you probably don't make a full disclosure either. Chancesare you keep your lactose intolerance and foot odour issues in the background, and save your Federation Starfleet uniform for later in the relationship - if there IS a later.

For a company trying to sell something, an ad is like getting a job interview with millions of people all at once. The ad wants to make a good first impression and really, really doesn'twant to make people mad. But different people react differently.

A lot of people question the ethics of selling consumers things they don't need - whichpresupposes that we shouldn't have the things we don't need but want anyway. We don't need90% of the stuff in our apartments. We don't need artwork, among other things. Neanderthalsdidn't need cave paintings, but they sure brighten up a grotto. Why did so many of us bringbottled water - that we paid for - into this meeting room today, when carrying a canteen of tapwater is so much more… rational?

Years ago, The Coca-Cola Company invented a better product. No consumer product hadever been so thoroughly tested with so many consumers. This new Coke was provably muchbetter. But consumers not only didn't buy it, they demonstrated against it. Because a lot of

what they loved about "real" Coke wasn't inside the bottle. It was the idea of Coke and their experiences with it and how those experiences were connected to so much of what we

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imagine life in America should be like. Advertising isn't just about the things we buy. It'sabout how we feel about things, including ourselves. That's what makes it interesting.

Tobacco Advertising: Ronald Reagan once appeared in ads touting the health benefits of acigarette brand. Times have changed. Now the space in which tobacco can be promoted in

any form is growing more restricted every day. And tobacco isn't the only legal - andpotentially lethal - product that poses ethical, not to mention public policy questions for us.

Alcohol: There are hundreds of beer commercials on the air, but not one of them showssomebody actually drinking the beer. Does that make them more ethical?

Children: Society imposes context on advertising ethics all the time - especially inadvertising that involves children. Here's a commercial for children's shampoo. There is noadult supervision shown around the swimming pool. The Children's Advertising Review Unit(CARU) of the Better Business Bureau (BBB), which also monitors kid's programming,requires that adults be shown supervising children when products or activities could be risky.

So L'Oreal changed the commercial to model good parental behavior. Score one for Society.Another commercial for Aim toothpaste showed a child who went to the bathroom in amuseum to brush her teeth. Good hygiene or not, it had to be taken off the air when teacherscomplained that they'd never, ever, let a child leave the group unattended. Advertisers spendmost of their waking hours trying to anticipate what their audiences will want and how they'llreact.

The major ethical issues in advertisements of FMCG sectors are discussed as follows:

1. Using and targeting children in advertisements:

Nowadays advertisements with children are influencing market very highly. Marketers areusing children in their commercial advertisements to push their sales. Because Indianchildren are allowed to watch each & every advertisement in the television, so marketers aretaking advantages of it. As marketers are using children in their commercial advertisements,it influences lot to Indian culture as well as Indian children’s to push their parent for particular products. Some of the advertisements are very relevant to children where marketersshould use children to promote their products in the market otherwise they can’t. For instance, Ads of Horlicks, Johnson & Johnson etc. But apart from this there are manycommercial ads where marketers use children even the products are not for children like,Super Nirma, Surf Excel etc. which is irrelevant for marketing point of view. These types of ads are only for to win emotion of the customers. Using children in advertisements

particularly in India where many people can’t afford the products but children force them tobuy those products which affect their economic levels, so marketers should go for childrenadvertisement for their relevant products only.

EXAMPLE:

i. DOMINO’S PIZZA MANIA - SCHOOL – CONTRACT

This advertisement was basically using and targeting children. Domino's, which showed aschool teacher at a remote location, who tempts her absconding students back to school, withthe promise of Domino's Pizza.

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In the first scene the teacher is waiting for students in school but not a single student came.Then she gets an idea to call everybody come to school. But she doesn’t have such amount togo for her idea. Then her staff member gave her some amount of money. Then she makes acall.

In other moment it’s shown that a person on bike coming with dominos pizza and studentsare running behind that bike.

So at the end the teacher gets successful in her idea of attracting the students towards schoolwhen they all are enjoying Domino’s pizza in school.

In this advertisement the target audience is school going children. They are being encouraged

toward Domino’s pizza which is a junk food and not good for health.

2. Comparative advertisements

Comparative advertising is an advertisement in which a particular product, or service,specifically mentions a competitor by name for the express purpose of showing why thecompetitor is inferior to the product naming it.

This should not be confused with parody advertisements, where a fictional product is beingadvertised for the purpose of poking fun at the particular advertisement, nor should it beconfused with the use of a coined brand name for the purpose of comparing the productwithout actually naming an actual competitor.

EXAMPLE:

i. HORLICKS VS COMPLAN

This case is about the advertising war between two popular health drink brands Horlicks &Complan in India. Over the years, the brands were involved in aggressive comparativeadvertising in print and television over attributes such as ingredients, protein content, growthand flavours. However, in late 2008, the makers of Horlicks, GlaxoSmithKline Consumer Healthcare, and the makers of Complan, Heinz India, came out with advertisements thatdirectly compared the brands using the competitor brand’s trademarks. Industry observers felt

that in their bid to outdo each other, the two companies had ended up denigrating thecompetitor brand.

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The two companies decided to solve the issue in the courts. In September 2008, Complanmoved the Mumbai High Court objecting to the Horlicks ad.

Advertisement was - The spot goes on with the complain boy saying,

Complan boy- my health drink has 23 nutrients, how much does yours have?

Horlicks boy- 23 nutrients and also something.

Complain boy- mine makes me “taller”.

Horlicks boy- mine makes me “taller, stronger and sharper”.

Complain boy- mine costs Rs. 178.

Horlicks boy- mine costs only Rs. 124.

Complain boy- mummy, in this case we are higher. Right!!!!!.

Hearing this the mother makes a grimace kind of look and the ad ends with a couple of people carrying a Horlicks billboard with 3 tenets of Taller, Stronger and Sharper.

Analysis of case-

Judgement passed- pending in Mumbai High Court.

Effect on public- misleading facts.

Effect on organisation- competitor’s strategy and its consequences. And maylose its customers to competitors.

Principle applied- it falls under the following category of section UNFAIR TRADE PRACTICES i.e. “DISPARAGING PRODUCTS OF

COMPETITORS”.

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ii. MUNCH VS. DAIRY MILK

First the Dairy Milk came with their campaign – “Celebrate Month's 1 st day with DariyMilk.” Then as an competitors dilemma-

Nestle Munch have come up with this reply punch – “One can eat Munch even on 2nd, 3rdand everyday of a month”

Nestlé, the country’s largest food products company, has come out with a new campaign for Munch, its price warrior in the market. That it takes off from the clutter-breaking CadburyDairy Milk ad which builds on celebrations around payday in small town India is very clear.“Aaj pehli tarikh hai,” (Today is the first day of the month) goes the jingle in the Cadburyadvertisement.

To which munch reply “Khao bina tareekh dekhe,” (Eat without looking at the date) intonesthe voiceover. “That’s why mera crunch mahan (my crunch of Munch is so great).” In the last

shot, the cuckoo reappears from the recess in the clock to say the 12th day of the month willfall next week. That its tongue hangs out and eyes are laden with boredom are hard to miss.

Analysis of case –

Judgement passed-pending in Mumbai high court

Effect on public-started comparing both the brands

Effect on organisation- competitor’s strategy and its consequences. And may lose itscustomers to competitors.

Principle applied-it falls under the following category of section unfair trade practicesi.e.-. “disparaging products of competitors”

iii. RIN VS TIDE

In this commercial, two mothers waiting at a bus stop for their children returning from theschool. While waiting together they glance at each other's shopping baskets. One woman'sbasket has a packet of Rin detergent powder, while the other has a packet of Tide Naturals.

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The Tide lady boasts confidently about Tide's khushboo aur safedi bhi (fragrance combinedwith whiteness) the theme on which the Tide Naturals campaign was based. The Rin ladydoes not show any reaction but has a beam on her face.

Thereafter, the school bus stops and drops off the two children.

The child of the woman carrying Tide is wearing a visibly dull shirt, while behind him a boycomes out wearing a spotless white shirt, who runs across the shocked Tide lady towards themother carrying the Rin packet.

Making the advertisement more aggressive, the boy asks his mother, "Aunty chaunk kyungayi?" ("chaunk " or startle has been used in P&G's earlier punch line)

As the ad concludes with a voice-over that Rin is 'behtar ' than Tide, when it comes towhiteness and at a chaukanewala price of Rs25.

3. False or misleading advertisements:

False advertising or deceptive advertising is the use of false or misleading statementsin advertising. As advertising has the potential to persuade people into commercialtransactions that they might otherwise avoid, many governments around the world useregulations to control false, deceptive or misleading advertising. Truth in labeling refers toessentially the same concept, that customers have the right to know what they are buying, andthat all necessary information should be on the label.

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False advertising, in the most blatant of contexts, is illegal inmost countries. However, advertisers still find ways to deceiveconsumers in ways that are not illegal.

EXAMPLE:

i. FAIR AND LOVELY

The advertisement campaigns of fair and lovely is based on thevarious concepts like

• Getting fair skin after 7 days by using fair and lovely.

• Getting marks free skin by using Fair and lovely antimarks cream.

But in reality these are false claims made by the company. These are not happened by using

their products.

ii. ROOP AMRIT

In this advertisement it is shown that A girl not having fair or clear skin goes for the audition for singing competition but shegets rejected, after using “Roop Amrit”, she gets her skin fair andbecome more confident than before. After that she again goes for audition, she gets selected. At last she wins the competition.

So in this Advertisement, it is wrongly shown that only theperson with fair skin can win the competition and roop amrit issuitable for having fair skin.

iii. DETTOL

In this advertisement, it is claimed that four out of five doctors recommend Dettol, they dntshow any data behind their such type of claim. Thay also claim it as “ sabse surakshit”.Thelarge grey area that exists between truth and deception contains ads that people often consider misleading. The ads are misleading because they depart from literal truth and fact.

For example, if an ad for Brand X soap claims "You can't buy a better deodorant soap thanBrand X or if a company says that all the doctors world over recommend this soap like in

DETOL ads. Many advertisements made claims like "4 out of 5 doctors surveyed recommendBrand Y." This became widely known as a half-truth because there was never any indicationof how many doctors had been consulted.

4. Poor taste and offensive advertisements:

Although certain ads might be in bad taste in any circumstance, viewer reactions are affectedby such factors as sensitivity to the product category, the time the massage is received (for example, in the middle of dinner), and whether the person is alone or with others whenviewing the message. Some things on television, for example, that might not bother an adultwhen alone would make that person uncomfortable if children were watching. Also,

questionable ads become offensive in the wrong context. Advertisers and media outlets musttry to be sensitive to such objections.

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We all have our own ideas what constitutes good taste. Unfortunately, these ideas vary somuch that creating general guidelines for good taste in advertising is difficult. Differentthings offend different people. In addition, taste changes over time. What was offensiveyesterday may not be considered offensive today.

EXAMPLE:

• The Breckenridge Ski Resort pulled an ad campaign that was designed toappeal to young men with lines like “The hill may dominate you. But thetown will still be your bitch.” Some young skiers in the resort’s target marketsaw no problem with the language, although the campaign was criticized asdistasteful by women’s groups, community leaders, residents and businessleaders.”

• One beer company was sued for violating public taste by using the slogan,“Good beer, No Shit.” The argument against it charged that such language is

offensive to many people and particularly inappropriate for children whocannot be protected from seeing and hearing the slogan.

5. Stereotyping

A stereotype is a representation of a cultural group that emphasizes a trait or group of traitsthat may not communicate an accurate representation of the group (blondes are dumb, Italiansare sexy). Sometimes the stereotype is useful (athletes are fit) and aids communication byusing easily understood symbolic meanings, but sometimes the stereotype relies on acharacteristic that is negative or exaggerated and, in so doing, reduces the group to acaricature.

EXAMPLE:

Take KFC’s recent advertisement launched in Australia featuring a cricket fan sitting amonga crowd of West Indian supporters. The Australian supporter offers a bucket of fried chickento get over the “awkward situation” with “ease”. Ad was running without any problems inAustralia, but once it made its way to YouTube, it caused quite a bit of stir among Americanviewers. KFC was alleged of using the offensive stereotype concerning Afro-Americans andfried chicken prevalent in America. KFC has taken the ad off air in Australia even though nosuch stereotype exists there and no complaints were received from there. This seems to be acase of ignorance on the part of Australian ad makers regarding the stereotype in question.

Such incidents sure will make marketers more wary of the global cultural repercussions of their brand promotion activities.

6. Puffery

It is defined as ‘advertisements or other sales representations, which praise the item to be soldwith subjective opinions, superlatives or exaggerations, vaguely and generally, stating nospecific facts´.

Although legal but unethical (reasonable vs. vulnerable consumers)

Puffery as a legal term refers to promotional statements and claims that express subjectiverather than objective views, such that no reasonable person would take literally. Puffery is

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especially featured in testimonials. "Puffery" consists of promotional claims that no one outof diapers takes literally. Your two-year old might believe that polar bears enjoy sippingCoca-Cola. But you know better. Because two-year-olds make no spending decisions,advertisers have always been free to enliven their ads with harmless hyperbole.

Under existing UCC law, the burden of proof rests on plaintiffs asserting that particular advertising claims are factually misleading rather than mere puffery. If the Commissioners'proposal becomes law, however, every advertising claim will be presumed to be part of theagreement between the seller and buyer. Buyers will be presumed to have relied upon eventhe most obviously absurd advertising exaggerations.

The burden of proof will then be on defendant advertisers to prove that a reasonable personwould not be misled by the challenged advertising claim. Because lawyers will easily findreasonable-looking plaintiffs to testify that they were misled by this or that advertisement,advertisers who make any claims beyond dry factual statements risk severe litigation losses.Advertisers are now liable for harms caused by genuinely misleading advertising.

For example, Coca-Cola would be liable to consumers for damages caused if it advertisesthat Coke cures cancer. Reasonable consumers might be fooled into drinking more Coke onlybecause of its alleged medicinal properties. But, by definition, puffery does not misleadreasonable consumers.

Regulatory Aspects of Advertising

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

Key Regulatory Agents

Government Regulation

Federal Trade Commission (FTC)

Wide range of regulatory programs and remedies

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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 governingbody

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

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– Consumer Alert

– Commercial Alert

CONCLUSIONS:

SOME STEPS TO TAKE

1) The indispensable guarantors of ethically correct behavior by the advertising industryare the well formed and responsible consciences of advertising professionalsthemselves: consciences sensitive to their duty not merely to serve the interests of those who commission and finance their work but also to respect and uphold therights and interests of their audiences and to serve the common good. Many womenand men professionally engaged in advertising do have sensitive consciences, highethical standards and a strong sense of responsibility. But even for them externalpressures from the clients who commission their work as well as from the

competitive internal dynamics of their profession can create powerful inducementsto unethical behavior. That underlines the need for external structures and systems tosupport and encourage responsible practice in advertising and to discourage theirresponsible.

2) Voluntary ethical codes are one such source of support. These already exist in anumber of places. Welcome as they are, though, they are only as effective as thewillingness of advertisers to comply strictly with them. "It is up to the directors andmanagers of the media which carry advertising to make known to the public, tosubscribe to and to apply the codes of professional ethics which already have beenopportunely established so as to have the cooperation of the public in making these

codes still better and in enforcing their observance." We emphasize the importance of public involvement. Representatives of the public should participate in theformulation, application and periodic updating of ethical codes. The publicrepresentatives should include ethicists and church people, as well as representativesof consumer groups. Individuals do well to organize themselves into such groups inorder to protect their interests in relation to commercial interests.

3) Public authorities also have a role to play. On the one hand, government should notseek to control and dictate policy to the advertising industry, any more than to other sectors of the communications media. On the other hand, the regulation of advertisingcontent and practice, already existing in many places, can and should extend beyond

banning false advertising, narrowly defined. "By promulgating laws and overseeingtheir application, public authorities should ensure that public morality and socialprogress are not gravely endangered' through misuse of the media." For example,government regulations should address such questions as the quantity of advertising,especially in broadcast media, as well as the content of advertising directed at groupsparticularly vulnerable to exploitation, such as children and old people. Politicaladvertising also seems an appropriate area for regulation: how much may be spent,how and from whom may money for advertising be raised, etc.

4) The media of news and information should make it a point to keep the publicinformed about the world of advertising. Considering advertising's social impact, it is

appropriate that media regularly review and critique the performance of advertisers,just as they do other groups whose activities have a significant influence on society.

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5) In the final analysis, however, where freedom of speech and communication exists, itis largely up to advertisers themselves to ensure ethically responsible practices in their profession. Besides avoiding abuses, advertisers should also undertake to repair theharm sometimes done by advertising, insofar as that is possible: for example, bypublishing corrective notices, compensating injured parties, increasing the quantity of

public service advertising, and the like. This question of ‘reparations' is a matter of legitimate involvement not only by industry self-regulatory bodies and public interestgroups, but also by public authorities.

Where unethical practices have become widespread and entrenched, conscientious advertisersmay be called upon to make significant personal sacrifices to correct them. But people whowant to do what is morally right must always be ready to suffer loss and personal injuryrather than to do what is wrong.

We do not wish, and certainly we do not expect, to see advertising eliminated from thecontemporary world. Advertising is an important element in today's society, especially in the

functioning of a market economy, which is becoming more and more widespread.

Moreover, for the reasons and in the ways sketched here, we believe advertising can, andoften does, play a constructive role in economic growth, in the exchange of information andideas, and in the fostering of solidarity among individuals and groups. Yet it also can do, andoften does, grave harm to individuals and to the common good.

In light of these reflections, therefore, we call upon advertising professionals and upon allthose involved in the process of commissioning and disseminating advertising to eliminate itssocially harmful aspects and observe high ethical standards in regard to truthfulness, humandignity and social responsibility. In this way, they will make a special and significant

contribution to human progress and to the common good.

Reputable companies and advertising agencies avoid telling lies. They realize the cost of being caught. A dent in trust can prove to be much costlier than the failure of an ad campaignor for that matter, even a brand. The challenge before advertisers and agencies is to ensurethat ads reflect our values.

We must endeavour to see that "advertising" does not remain a dirty word.

Advertising is not unethical if it’s done in the right way.

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Bibliography

1. http://www.fms-marketing-blog.com/?p=182

2. http://www.economywatch.com/world-industries/fmcg.html

3. http://rajeshaithal.blogspot.com/2010/03/rin-vs-tide-ad-ethical.html

4. http://wikitp.blogspot.com/2009/11/stereotyping-in-indian-ads_5486.html

5. http://www.hindu.com/edu/2004/12/13/stories/2004121301200401.htm

6. http://ramanuj.blogspot.com/2005/09/fmcg-ethics.html

7. http://www.themarketers.in/?p=1078

8. http://www.jstor.org/pss/2488823

9. http://drypen.in/branding/dominos-is-back-on-the-advertising-circuit- khushiyon-ki-home-delivery.html

10. http://www.livemint.com/2008/01/02222234/FMCG-firms-pulled-up-for- misle.html11. http://ezinearticles.com/?Deceptive-Advertising---An-Essay&id=5155830

12. http://en.wikipedia.org/wiki/False_advertising#Other_deceptive_methods

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http://www.fms-marketing-blog.com/?p=182

http://www.economywatch.com/world-industries/fmcg.html

http://rajeshaithal.blogspot.com/2010/03/rin-vs-tide-ad-ethical.html


http://wikitp.blogspot.com/2009/11/stereotyping-in-indian-ads_5486.html


http://www.hindu.com/edu/2004/12/13/stories/2004121301200401.htm


http://ramanuj.blogspot.com/2005/09/fmcg-ethics.html


http://www.themarketers.in/?p=1078


http://www.jstor.org/pss/2488823


http://drypen.in/branding/dominos-is-back-on-the-advertising-circuit-khushiyon-ki-home-delivery.html



http://www.livemint.com/2008/01/02222234/FMCG-firms-pulled-up-for-misle.html



http://ezinearticles.com/?Deceptive-Advertising---An-Essay&id=5155830


http://en.wikipedia.org/wiki/False_advertising#Other_deceptive_methods


http://www.economywatch.com/world-industries/fmcg.html













http://www.fms-marketing-blog.com/?p=182

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