AdvertisingAdvertising
MKTMKT00350035
Chapter 2:Chapter 2:
Economic, Social &Economic, Social &
Regulatory Aspects ofRegulatory Aspects of
AdvertisingAdvertising
Advertising’sAdvertising’s
ControversiesControversies
Advertising’s Controversy
 Cause for consumer distrust.
 People will say ANYTHING to sell stuff.
 People don’t rely exc...
Economic ImpactEconomic Impact
““Abundance”Abundance”
PrinciplePrinciple
In an economy that produces more
goods and services than can be
consumed, advertising plays 2 crucial
roles: 1) Keeps cons...
Social ImpactSocial Impact
PufferyPuffery
From pyffanpyffan, old English word
meaning “blow in short bursts” or “to
inflate; make proud or conceited.”
Puffery
“Advertising, by its
very nature, is not
complete information.
It is biased in favor of
the advertiser.”
Puffery
SubliminalSubliminal
AdvertisingAdvertising
Subliminal Advertising
 Placing hidden messages in ads to
influence consumer behavior at a
subliminal (subconscious) leve...
Social ImpactSocial Impact
Social Impact
 Advertising lowers our collective values
by promoting hedonistic, materialists
way of life.
 Continuous p...
Social Impact
 Advertising’s negative impact on
CHILDREN.
Yeah Perhaps But…Yeah Perhaps But…
Don’t consumers have theDon’t consumers have the
FINAL say in whetherFINAL say in whether
advertising is successful?advert...
Social Responsibility & Ads
 Laws control what advertisers say but
there’s a large amount of leeway.
 Ethics and corp. s...
What ETHICALWhat ETHICAL
OrganizationsOrganizations
Look LikeLook Like
HowHow NOTNOT to Actto Act
Hall of ShameHall of Shame
Advertiser Responsibilities
 Participate in civic events.
 Support local enterprises.
 Improve local, regional and nati...
RegulatoryRegulatory
ConsiderationsConsiderations
Regulatory Factors
 Supreme Court distinction between FREEFREE
speech & “CommercialCommercial” speech.
 1980 Supreme Cou...
Regulatory Factors
The current Supreme Court is EXTREMELY
PRO-business.
The Regulators
 FCC.
 FTC.
 FDA.
 USPTO.
 Library of Congress.
Terms
 DECEPTION: Any ad that contains a
misrepresentation, omission or any other
practice that can mislead a significant...
Self-Regulation
 Advertising agencies regulate
themselves.
 Most have “In-house” legal counsel.
 4A, Amer. Advertising ...
ResourcesResources
Resources
Advertising Class Baruch College Week 2
Advertising Class Baruch College Week 2
Advertising Class Baruch College Week 2
Advertising Class Baruch College Week 2
Advertising Class Baruch College Week 2
Advertising Class Baruch College Week 2
Advertising Class Baruch College Week 2
Advertising Class Baruch College Week 2
Advertising Class Baruch College Week 2
Advertising Class Baruch College Week 2
Advertising Class Baruch College Week 2
Advertising Class Baruch College Week 2
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Advertising Class Baruch College Week 2

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Advertising class presentation for advertising and marekting professionals.

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Advertising Class Baruch College Week 2

  1. 1. AdvertisingAdvertising MKTMKT00350035
  2. 2. Chapter 2:Chapter 2: Economic, Social &Economic, Social & Regulatory Aspects ofRegulatory Aspects of AdvertisingAdvertising
  3. 3. Advertising’sAdvertising’s ControversiesControversies
  4. 4. Advertising’s Controversy  Cause for consumer distrust.  People will say ANYTHING to sell stuff.  People don’t rely exclusively on advertisers for information, product comparisons, facts, features & benefits.  Expands/fosters/creates MATERIALISM.  US Advertising 2% GDP highest in world.  Makes products cost more? Or less???  Reduces competition?
  5. 5. Economic ImpactEconomic Impact
  6. 6. ““Abundance”Abundance” PrinciplePrinciple
  7. 7. In an economy that produces more goods and services than can be consumed, advertising plays 2 crucial roles: 1) Keeps consumers informed of their alternatives (complete information) and: 2) Allows companies to compete more effectively for consumer dollars (self-interest.) Abundance Principle
  8. 8. Social ImpactSocial Impact
  9. 9. PufferyPuffery
  10. 10. From pyffanpyffan, old English word meaning “blow in short bursts” or “to inflate; make proud or conceited.” Puffery
  11. 11. “Advertising, by its very nature, is not complete information. It is biased in favor of the advertiser.” Puffery
  12. 12. SubliminalSubliminal AdvertisingAdvertising
  13. 13. Subliminal Advertising  Placing hidden messages in ads to influence consumer behavior at a subliminal (subconscious) level.  Fear that advertisers mess with our heads.  Wilson Bryan Key: to seduce consumers, advertisers intentionally create ads with sexual messages hidden in the illustrations.
  14. 14. Social ImpactSocial Impact
  15. 15. Social Impact  Advertising lowers our collective values by promoting hedonistic, materialists way of life.  Continuous proliferation in ad messaging that bombards consumers.  Per Nielsen, 16-21 minutes of an hour’s TV programming is advertising.  Stereotypes played out through insensitivity to women, minorities, the disabled, elderly, and others.
  16. 16. Social Impact  Advertising’s negative impact on CHILDREN.
  17. 17. Yeah Perhaps But…Yeah Perhaps But…
  18. 18. Don’t consumers have theDon’t consumers have the FINAL say in whetherFINAL say in whether advertising is successful?advertising is successful?
  19. 19. Social Responsibility & Ads  Laws control what advertisers say but there’s a large amount of leeway.  Ethics and corp. social responsibility play a role.
  20. 20. What ETHICALWhat ETHICAL OrganizationsOrganizations Look LikeLook Like
  21. 21. HowHow NOTNOT to Actto Act
  22. 22. Hall of ShameHall of Shame
  23. 23. Advertiser Responsibilities  Participate in civic events.  Support local enterprises.  Improve local, regional and national economies.  4A & Ad Council.
  24. 24. RegulatoryRegulatory ConsiderationsConsiderations
  25. 25. Regulatory Factors  Supreme Court distinction between FREEFREE speech & “CommercialCommercial” speech.  1980 Supreme Court case: “Central Hudson Gas…” presented 4 key considerations for advertising: • Does the commercial speech at issue concern a lawful activity? • Will the restriction of commercial speech serve the asserted Gov’t interest substantially? • Does the regulation directly advance the Gov’t interest asserted? • Is the restriction no more than necessary to further the interest asserted?
  26. 26. Regulatory Factors The current Supreme Court is EXTREMELY PRO-business.
  27. 27. The Regulators  FCC.  FTC.  FDA.  USPTO.  Library of Congress.
  28. 28. Terms  DECEPTION: Any ad that contains a misrepresentation, omission or any other practice that can mislead a significant # of reasonable consumers to their detriment  UNFAIRNESS: Occurs when a consumer is “unjustifiably injured” or there is a “violation of public policy.”
  29. 29. Self-Regulation  Advertising agencies regulate themselves.  Most have “In-house” legal counsel.  4A, Amer. Advertising Federation, Assn. of National Advertisers and the BBB.
  30. 30. ResourcesResources
  31. 31. Resources
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