Surrogate advertising in India

281MANAGEMENT AND LABOUR STUDIES Vol. 36 No. 3, August 2011
Surrogate advertising in India
Sangeeta Dodrajka
Advertising is no longer a social waste as earlier perceptions. It is a
necessary evil which is there to stay as it not only increases awareness
about products but also enhances the choices for taking rational decisions
for consumers. It leads to all sorts of healthy and unhealthy practices by
distributors and marketers. Marketers use surrogate advertisements and
brand extensions for propagating the banned products like liquor and
tobacco. Many companies resort to other means of advertising also like
sponsoring various sports personalities and tournaments which mark
the presence of the products and reestablish their brands in the
marketplace indirectly. A survey was conducted to gauge the extent of
damage done to young Indian minds and whether their consumption
habits are affected by such practices or not. The regulatory body needs to
be empowered for curbing such practices.
Keywords : Surrogate advertising, branding, brand extensions.
Sangeeta Dodrajka, Associate Professor, Sri Guru Gobind Singh College of Commerce (Univ. of
Delhi), Delhi. Email: sangeetadelhi@hotmail.com
Introduction
Modern life is full of challenges,
opportunities and complex desires.
Human beings are social animals,
continuously desiring something or the
other. Their quest for change has led to
inventions and innovations by leaps and
bounds. In this era of consumerism, it is
impossible to imagine life even for a
minute without Internet, newspapers,
television or radio, which means
exposure to thousands of advertisements
every minute. Advertising is paid and/
or sometimes free communication
through a medium in which the sponsor
is identified and the message is
controlled. Variations include publicity,
public relations, product placement,
sponsorship, and sales promotion.
Advertisements can be seen on the grocery
carts, on the walls of an airport walkway,
on the bus stops, heard in telephone hold
messages and Internet sites.
Weekly newspapers in London first
carried advertisements in the 17th
century; by the 18th century such
advertising was flourishing. The first
advertising agencies were established in
the 19th century to act as broker for
space in newspapers, and by the early
20th century, agencies were producing
the advertising message copies
themselves. Most advertising promotes
products/services for sale, but similar
at MGMT DEV INST GURGAON on July 25, 2016mls.sagepub.comDownloaded from

methods are used in public service
messages to promote causes, charities,
or building images of political
candidates during elections.
However, advertising involves several
responsibilities. Advertising informs the
public so that they can be aware of
products and make informed choices out
of a plethora of various products or
brands available in the globalised
scenario. Advertising is advantageous
to business firms by assisting them to
increase the sales of their products or
services. But while dispensing its role
as a dream merchant, advertising has
also been in the vortex of controversy of
the many troubles that it brings to the
Indian society. It is accused of
encouraging materialism and
consumption, of causing us to purchase
products which we do not need. It takes
advantage of innocent children/
audience by manipulating their mindset,
using sex to sell, and generally
contributing to the downfall of our socio-
cultural value system.
Advertising does not function in a
vacuum but in a market environment
where several forces like consumer
needs, business interests and
government regulations are at work. It is
a powerful force in terms of its
persuasiveness and provider of
information. Moreover with the high
visibility, it generates criticism and
controversy. Much of this controversy
originates from the fact that advertising
is used more as a persuasive
communication tool thereby creating
impact on the tastes, values and
lifestyles of people. It leads to all sorts of
healthy and unhealthy practices by
marketers. Marketers use surrogate
advertisements and brand extensions for
propagating the banned products like
liquor and tobacco. Many companies
resort to other means of advertising also
like sponsoring various sports and social
events which establish their brands in
the minds of prospective consumers
indirectly.
Surrogate advertising is that form of
advertising which establishes a brand
or product message inside an
advertisement which is presumably for
another brand or product. For example,
a cigarette company might issue public
interest statements relating to a topic
such as tuberculosis, using the company’s
logo or distinctive brand colors in the
advertisements so that people are
exposed to the company’s branding
without seeing an explicit ad for the
company’s product. This is also known
as brand stretching as it uses products
under a similar brand umbrella to
promote prohibited products like,
alcohol.
There are a number of reasons for
companies to use surrogate advertising.
One of the most common reasons is to
circumvent a ban on direct
advertisements of particular products.
Many countries have laws restricting
advertising of alcohol and tobacco
products, for example, so companies use
surrogate advertising to market their
products. Techniques used might
include advertising another product
with the same brand, sponsoring
community welfare events, issuing
public interest messages, or sponsoring
sports events/tournaments. All these
activities technically do not violate the
ban on direct advertising, but the
consumers become aware about the
brands.

A market survey in 2001 revealed that
advertising has a direct influence on the
consumption habits of 431 million
people in India and an indirect impact
on 275 million ‘aspirants’ from the lower
income group. Considering that nearly
50 per cent of the television owners have
access to cable channels, there is no
doubt that the hidden call for alcohol
consumption behind the surrogate
advertisements is not escaping the eyes
of viewers in the world’s fourth highest
liquor-consuming country. The very
purpose of banning liquor advertisements
is defeated by surrogate advertising.
Surrogate advertising may also be used
when companies want to cultivate an
image of social responsibility. For
example, many health advocates have
criticized advertisements for sweet treats
aired on specific channels/programmes
meant for children viewing. A company
might pull outright advertising during
these time slots and instead air a series
of public service announcements about
eating a balanced diet, with the
announcements coincidentally bearing
the company’s brand name.
Pharmaceuticals are another product
with advertising restrictions.
Historically, pharmaceutical companies
were not allowed to advertise
prescription medications at all. Once this
regulation was relaxed, some restrictions
were left in place. Using surrogate
advertising allows companies to get
around regulations. For instance, the
manufacturer of an anti-obesity
medicine might sponsor informational
commercials about physical fitness and
weight management, with the
medication branding scattered
throughout the advertisement to get
consumers used to the brand and to
imply that the medication plays an
important role in managing weight.
Some countries have expressed concern
about surrogate advertising, and have
started prosecuting companies which use
such advertising to challenge bans on
explicit advertisements. If a country can
prove that a company crossed a regulatory
line with its advertisements, it can force
the ad-campaign to be pulled, and the
company may be required to pay a fine. To
implement the same in India, more
stringent rules and laws are required to be
framed. Companies airing advertisements
using unfair means are covered by ASCI.
The scope of the same should be enhanced
to include surrogate ads.
Review of Literature
Based on the empirical evidence,
advertising ethics has been a very fertile
research topic. Previous research articles
examine the ethicality of advertisements
with persuasive appeals (Crisp, 1987;
Hyman and Tansey, 1990), exploitative
appeals (LaTour and Zahra, 1989,
Tansey, Hayman and Brown). Others
examine the ethicality of advertisements
with stereotyped actors (Peterson, 1992;
Green, 1993), questionable products
such as cigarettes, alcoholic beverages
(Pomeroy, Castellano, Becker, Johnson,
and Brown 1992; Zinkhan et al. 1989),
professional services (Bullard and
Snizek 1988; Mangold 1987; Stafford
1988). Some other articles focus on the
ethicality of targeting advertisements to
children (Kinsey, 1987) and to other
subgroups such as the elderly (Peterson,
1992).
Previous studies on advertising
regulation have primarily focused on
deception: Ivan L. Preston (1987), Gary

J. Gaeth and Timothy B. Heath (1987),
John Liefeld and Louise A. Heslop
(1985), James D. Gill and Sanford
Grossbart (1985); materiality: Jef I.
Richards and Ivan L. Preston
(1992);puffery:Michael A. Kamins and
Lawrence J. Marks (1987), Gerald A.
Schorin, Bruce G. Vanden Bergh, and
Keith Adler (1984), Gary Kurzbard and
Lawrence C. Soley (1984), Bruce G.
Vanden Bergh, Dean M. Krugman, and
Michael B. Salwen (1983).
The Debate about Alcohol and Tobacco
Advertising
The alcohol and advertising industries
argue that, as alcoholic drink is a legal
product it should be legally possible for
it to be advertised, and that bans on
alcohol advertising would have adverse
effects on the alcohol market. They also
argue that bans are not justified as
advertising is concerned with promoting
sales of individual brands and there is
no evidence of a causal link between
advertising and the overall level of
alcohol consumption or the amount of
alcohol- related harm. The main counter
arguments are that as well as promoting
brands, advertising is also concerned
with recruiting new drinkers and
increasing sales among existing, and
especially heavy consumers. Intensive
advertising and promotion of alcohol
appears to sanction and legitimatise use
of a product which causes high levels of
damage to individuals and society. By
definition, alcohol advertising is one-
sided, avoiding any reference to the
negative aspects of alcohol
consumption. In modern circumstances,
it is also necessary to enable alcohol to
compete against other alternative drugs
as well as soft drinks. There is in fact
some evidence that bans on alcohol
advertising can have beneficial effect on
the level of harm, at least in the longer
term. Industry has an argument that
advertising is only about expanding or
protecting brand share, not total
consumption, and that if there are any
problems, industry self-regulation is the
answer. Table 1 gives the details of total
liquor sale in Delhi in a certain period.
Table 1: Sales of various types of liquor for Delhi
Year Sales of Beer Sale of IMFL in Sale of Country
in Bottles bottles Liquor in bottles
1994-95 18797645 29784767 15304848
1995-96 26753113 31100383 17813584
1996-97 28852880 39999614 27470904
1998-99 36570636 47567740 31920975
1999-2000 32111134 44707386 33513108
2000-2001 32394000 42969000 36794000
2001-2002 33960000 46406000 46142645
2002-2003 43527000 51848000 57451000
Source: www.delhigovt.nic.in

In the year 2007-08, Excise Department
of government of Delhi has reported
revenue growth of Rs. 1147 crores from
Rs. 300 crores (approximately) in the year
1994-95, as depicted in Table 2. Despite
the conflict between earning more
revenue for the exchequer and social
responsibility, the government has
selected the second option by restricting
the advertising of liquor and tobacco
based products. The revenue earnings
have been consistently increasing as can
be observed from the table.
Table 2: Revenue earned by Excise
Department from Sale of Liquor
Financial Revenue Collected
Year (Rs. in Crores)
1994-95 308.45
1995-96 335.75
1996-97 446.10
1997-98 545.00
1998-99 526.50
1999-2000 566.00
2000-2001 560.00
2001-2002 610.58
2002-2003 725.29
2003-2004 708.36
2004-2005 858.10
2005-2006 1015.0
2006-2007 1147.0
2007-2008 1166 (Target)
Source: http://excise.delhigovt.nic.in
Origin of Surrogate Advertisements
As a reaction to the directive of
Government, the liquor & tobacco
manufacturers sought other ways of
endorsing their products. They have
found an alternative path of advertising
through which they can keep on
reminding their liquor brands to their
customers. They have introduced various
other products with the same brand
name. Launching new products with
common brand name is known as brand
extension, which can be carried out for
related products (eg: Tata Salt and Tata
Tea) or unrelated products (eg: Tata Tea
and Tata Indica). Prima facie, there is
nothing wrong with brand extension.
The problem occurs when brand
extension is carried out in response to
the ban on advertisement of one product
category. In this case, the companies
launch other products with the same
brand name for the purpose of reminding
their old customers. The advertisements
for such new products are placed under
the category of “Surrogate
Advertisements”. Their only objective is
to compensate the losses arising out of
the ban on advertisements of one
particular product (i.e. liquor).
Surrogate Advertisements Promoted by
Liquor and Tobacco Industry
The liquor industry is a prominent player
in this game. Few surrogate
advertisements shown in print,
electronic and outdoor media are -
Bagpiper soda and cassettes & CDs,
Haywards soda, Derby special soda,
Gilbey green aqua, Royal Challenge golf
accessories and mineral water,
Kingfisher mineral water, White
Mischief holidays, Smirnoff cassettes &
CDs, Imperial Blue cassettes & CDs,
Teacher’s achievement awards etc.
These products bear exactly the same
brand name and logo, which we had

seen earlier in liquor advertisements. It
was little surprising to know that liquor
giants like McDowell’s and Seagram’s
have entered into new segments like
cassettes & CDs, mineral water, sports
accessories etc. Later it was found that
the basic aim of these surrogate
advertisements was to promote their
liquor brands like beer, wine, vodka etc.
This brand extension is an act of
bypassing the advertisement ban.
A similar trend is followed by companies
making Cigarettes, Paan Masala and
Gutkha. Few examples of surrogate
advertisements in this category are - Red
& White bravery awards, Wills lifestyle,
Four Square white water rafting,
Manikchand awards etc. Though a ban
has been imposed on advertisements
endorsing tobacco products, this
industry has resorted to surrogate
advertising a few years ago. The Health
Ministry has recently implemented the
tobacco control legislation which will
imply a complete ban on advertisements
and all direct & indirect promotional
campaigns for tobacco products. In 2001,
Indian Tobacco Company (ITC) had
voluntarily withdrawn the Wills Sports
sponsorship of the Indian cricket team
when the Government had first
proposed a ban on advertising through
legislation.
The Corporate Standpoint
The industry segment has its own
standpoint in defense. The liquor lobby
claims that everything is in accordance
to the Government regulations. “If a
brand has equity, why shouldn’t it be
allowed to advertise? Also, brand
extension is an industry practice
adopted by different product categories,”
comments Alok Gupta of UB group.
“When we advertise our products, we
follow all the guidelines,” declares
president, sales & marketing, Radico
Khaitan. They clarify that they have
stopped showing liquor advertisements
and they are free to use the brand name
for any other products. Even the
Confederation of Indian Alcoholic
Beverages Companies (CIABC)
advertising code maintains that
advertisement of products (real brand
extensions) by the liquor industry must
be allowed.
From a layman’s point of view, their
claims seem to be justified. But this is a
clear example of taking advantage of the
loopholes. There is a point to ponder.
When they have stopped showing liquor
advertisements, why the same brand
name and logo is used to promote
products like cassettes & CDs or mineral
water? They could have assigned
different brand names. It seems they
have a hidden agenda of highlighting
the liquor or tobacco brand.
A similar tussle over the issue of
surrogate advertisements in politics was
raised in April 2004 on the eve of Lok
Sabha elections. Complaints of
malicious and offensive advertisements
were raised by two major political parties
- BJP and Congress against each other.
The issue became so serious that the
Supreme Court had to interfere in this
affair. Finally on 13 April 2004, the Court
gave a verdict to curb smear
advertisements on electronic media. By
appointing Election Commission as
referee, the court has tried to put an end
to surrogate advertising in politics.
According to the Cable Act under the
ministry of information and

broadcasting,- “no broadcaster is
permitted to show an advertisement
which promotes directly or indirectly,
sale or consumption of cigarettes,
tobacco products, wine, alcohol, liquor
or other intoxicants…” Now a new
clause has been added under the act
stating that “any advertisement for a
product that uses a brand name which
is also used for cigarette, tobacco
product, wine, alcohol, liquor or any
other intoxicant will not be permitted”.
Finally, in April 2005, the ministry
resorted to a ban on surrogate
advertisements of liquor and tobacco
products on television.
After this directive, the surrogate
advertisements are seldom shown on
television. Now the companies will have
to reframe their policies. But who will
take care of print and outdoor media is
not certain. According to ASCI
(Advertising Standards Council of
India), surrogate advertisements are
harmful. Now it will be up to the ASCI to
take up the matter with the respective
companies.
Tobacco and alcohol are public health
hazards. Tobacco has adverse effects on
social, economic, health and
environmental factors. Alcohol too has
adverse medical, psychological, social
and economic impacts. Other similar
characteristics between alcohol and
tobacco are its increasing social
acceptability, dependence on the
product, aggressive marketing of the
product particularly to encourage youth
as its consumers. Tobacco is the second
major common cause of death and the
fourth leading risk factor for diseases. It
is responsible for the death of one in ten
adults - 5 million deaths a year
worldwide (WHO, Tobacco Free
Initiative). While alcohol is the leading
risk factor related to the major burden of
disease in low mortality developing
countries and the third most prevalent
risk factor for leading diseases and
injuries in developed countries (WHO,
2002).
Consumption of tobacco and alcohol in
India has been rising, possibly due to
economic liberalization of the Indian
market. Privatization and opening up
the market to foreign companies
dramatically changes the advertising
and marketing of alcohol and India lacks
alcohol and tobacco control national
policies and strategies. In contemporary
India, advertising has played a leading
role in encouraging the use of tobacco
and alcohol among the youth through
portrayal in congenial social settings,
association of the product use with
glamour and celebrity status.
The Real Scenario: Trends in Alcohol
Advertising and Promotion
Trends in Tobacco Advertising and
Promotion before the enforcement of
tobacco control legislations in India:
direct advertising of tobacco products
was rampant before the enforcement of
tobacco control legislation in India.
Billboard advertising of international
and domestic brands of cigarettes and
chewable forms of tobacco was a
common sight. Surrogate Advertising or
Brand Stretching was also common.
Sponsorship of sports events and
cultural events by tobacco companies
were methods of promoting tobacco
brand names. e.g. ‘Wills’ (brand of
Indian Tobacco Company - ITC, a
subsidiary of British American Tobacco)

used to sponsor Indian cricket team/
matches. Tennis tournaments were
sponsored by ‘Gold Flake’ cigarette
(brand of Godfrey Phillips India Ltd. -
GPI, a subsidiary of Phillip Morris). Boat
racing was sponsored by ‘Four Square’
cigarettes (brand of GPI). Polo events and
golf were sponsored by ‘Classic’
(cigarette brand of ITC). ‘Charms’, a
cigarette brand sponsored the ‘Spirit of
freedom concert’, a musical event.
‘Manikchand’, manufacturers of gutkha
(chewing tobacco), patronized the
Filmfare awards ceremony. Advertising
paan masala/ mouth fresheners bearing
the same brand name as tobacco
products is a common practice. The “Red
and White” Bravery Awards are
organized by GPI to advertise and
promote ‘Red & White” brand of their
cigarettes.
All direct advertising of tobacco
products in all media has been
prohibited with the enforcement of
National Legislation. Surrogate
advertising through brand stretching is
a common practice being employed by
some tobacco companies. “502 Pataka”
a popular beedi (local Indian cigarette)
brand is now being advertised as 502
Pataka chai (tea).
Indirect Advertising
Teacher’s whiskey has launched the
Teacher’s Achievement Awards. Other
sponsored awards and events include:
“Smirnoff international fashion award”.
“Lakme India Fashion Week” was
sponsored by Seagram’s Blenders pride.
Sponsorship of sports and cultural
events is widely undertaken by alcohol
companies in India. “Royal stag”
sponsors Indian cricket matches and
cricket players. “Shaw Wallace”
sponsored the Indian open golfing event
as the Royal Challenge Indian open and
the Kenya cricket team. “Seagram”
sponsors events such as “Chivas Regal
Polo championships” and “Chivas
Regal Invitational golf challenge” for
corporates.
Survey Analysis
A survey was conducted on 100 young
people between the age group of 20-40
regarding the surrogate ads in India. An
attempt has been made to gauge the
extent of impact of such advertising on
consumers and people in general
through a questionnaire based on their
perceptions and feelings on the topic.
They were asked a number of questions
such as, “Do you think restriction on
liquor, cigarettes and tobacco ads is
right?” “What is their opinion on
various companies sponsoring sports
and similar events and promoting the
banned brands in return?”Their take on
brand extention was also analysed and
observed that 28% were in favour of the
corporates being allowed to sponsor
events whereas as much as 68%
respondents felt that it should be
discontinued. While 60% of respondents
were of the opinion that such
advertisements do have a negative
impact on young consumers. According
to 54% people, ban on liquor, paan
masala, and cigarettes was right,
whereas, 36% were in favour of such
advertisements.
Regarding a question on success rate of
such ads in conveying the message to
the audience, 24% consented whereas
74% had the opinion that it was to some
extent conveyed and understood by the

recipients. More than half of the
respondents agreed that the ads do
influence their decision to buy such
products. Only 14% denied to have been
influenced by such ads and 28% could
not correlate the decision to buy with the
corresponding advertisement.
Following are some of the findings:
• More than half of the respondents
think that banning of direct
advertising by liquor and cigarette
companies is right and that is
because most of them think that by
showing such ads will have a
negative impact on youth as this is
the age when people get provoked
very easily and carried away by the
glitz and glamour involved in
consuming such products.
• It is surprising to note that as 60%
people think that these companies
should be allowed to sell their
products through brand extensions
like mineral water, CDs, and
cassettes, by sponsorships of
events, etc., so that the companies
get the right to let the consumers
know about their products.
• Finally, according to results, its
clear that surrogate advertising is
almost successful in conveying
what they intended to as was
indicated by results of word
association test carried on to the
respondents , some of the findings
are as follows:
Kingfisher – Beer, and few of them
mentioned airlines but none actually
thought of mineral water.
Royal Stag – Whiskey was prompt
answer
Wills – most of them thought of cigarettes
but few girls mentioned wills life style
store
Manik chand – almost all thought of
gutka.
Conclusion
In a free society producers have a
legitimate right to let consumers know
about their products through
advertisements and consumers should
not be denied the right to information
which is honest. However, surrogate ads
are not only misleading, but also false
adding glamour to consumption of the
banned products. It is time now for
Indian government to take serious note
of such violations of laws and sentiments
of our sensibilities. There should be
stringent regulatory measures to curb the
practice.
The Supreme Court directive has made
us agree that Surrogate advertisements
in all categories should be banned.
Another good indication is from the
ministry of information & broadcasting,
which has targeted to curb surrogate
advertisements on television. Finally, the
print and outdoor media should also be
included and surrogate advertisements
must be banned.
The motivations of firms look even more
suspect when they advertise products
that cannot be bought. In 2002, for
example, Jagatjit Industries, the maker
of Aristrocrat Whisky, advertised a
product called ‘Aristrocrat Apple Juice.’
The company reportedly confirmed
availability of the fruit juice in Delhi,
Haryana, Punjab and Rajasthan; yet, no
reputed shop in Delhi had ever seen it,
let alone, sells it.

REFERENCES :
1. “Tobacco ads likely to be stubbed out
by Jan-end”, Hindustan Times, 22
January 2004.
2. “Election Commission to clear all
poll ads”, Hindustan Times, 14 April
2004.
3. www.businessstandard.com/
strategist/storypage.php
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BruceG.VandenBergh,DeanM.Krugman,
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Readership
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