ADPR 3100 (UGA/Evans) Test #3

The claim that Listerine could cure colds was deemed...

deceptive/illegal

Which company in 1975 were forced by the FTC to spend $10 million on corrective advertising that read, "Contrary to prior advertising, ______________ will not help prevent colds or sore throats or lessen their severity."

Listerine

What was a campaign by Listerine in 2005 that caught the eye of the FTC?

"Just as good as flossing" claim

Substantiation

What is measurable or can be proven

Claims have to be....

substantiated/backed up (Nissan example)

Deception is to ________ as Puffery is to ________

illegal, legal

The claims made by ______ may be false, but they are not really lies because no one can disprove them & no one can prove them either.

puffery

Deception is _________ ________________ while Puffery is not _________ _______________

legally actionable

Material =

impactful to behaviors, attitudes, and beliefs

What year was the Federal Trade Commission (FTC) created?

1914

Why was the Federal Trade Commission (FTC) created?

to prevent unfair competition and to monitor & defer false, fraudulent, misleading, or deceptive advertising

What is the FTC three part test used to determine?

Evaluates deceptive or untruthful advertising

FTC Three Part Test (1983)

1. There must be representation, omission, or practice that is likely to mislead the consumer

2. The act or practice must be evaluated from the perspective of a reasonable consumer

3. The representation, omission, or practice must be material--- this is likely to affect a consumer's choice or use of a product or service

Product Placement is a form of...

Artistic Expression (bc of a lack of claims)

Artistic Expression has what level of constitutional protection?

Highest level of free speech

How does the FTC become aware of deceptive practices?

From sources such as the FTC staff, NAD, & CARU (for kids)

Order of constitutional protection for speech (highest to lowest)

Artistic Expression, Political Speech, Commercial Speech, Corporate Speech, & Slander/Hate Speech

Consent Decree

a document that does not admit to deception, yet acknowledges that the advertiser will stop running the sanctioned ad

What happens if the advertiser doesn't sign a consent decree, breaks it, or continues to run the ad?

1. The FTC has the power to issue a "cease and desist" order

2. Mandate for advertiser to start running corrective advertisements

3. Case can go to federal court where advertiser may have to pay consumers back

Cease and Desist Order

$10,000 a day fine if an advertiser do not sign the consent decree

National Advertising Division (NAD)

main group that receives, evaluates, and acts on complaints from the public, from agencies and other business concerns, and from internal staff members

CARU

child-directed advertising complaints or issues

National Advertising Review Board (NARB)

70 person panel of professionals made up of 40 advertiser reps, 20 agency reps, and 10 public reps. They evaluate advertiser appeals the NAD or CARU cannot resolve

December 21, 2015

FTC issued new guidelines for businesses using native

How to make native advertising disclosures clear and prominent?

1. Proximity/Placement

2. Prominence

3. Clarity of Meaning

Sponsored Links/Recommended Widgets/Content Discovery Platforms

- Highly targeted placements

- Use proprietary data (cookies/browser history)

- Helps advertisers generate awareness, engagement, or conversations

Native Advertising Articles (Sponsored Content/Article Style Native Ads)

- Articles resemble the format of original content

- Often include featured brands/products

How to tell whether an article includes native advertising?

Sole distinguishing characteristic is disclosure statement that tells you its advertising

What will make up 60% of all display spending in the US?

Native Advertising

What type of native advertising currently accounts for the most spent?

Social Media (i.e. facebook)

____________ native advertising is growing at a faster rate than social

Non-social (By 2019 social will account for less than 70%)

Native Advertising

1. "paid ads that are so cohesive with the page content, assimilated into the design, and consistent with the platform behavior that the viewer simply feels that they belong"

2. "content that bears a similarity to the news, feature articles, product reviews, entertainment, and other media that surrounds it online"

3. "paid advertising where the ad matches the form, feel, and function of the content of the media on which it appears"

4. "paid form of advertising whose appearance is often in the form of editorial content from the publisher"

Problems with Native Advertising

1. Consumers are skeptical/avoidant of most forms of advertising

2. Advertising is more entertaining/interesting=harder to tell what is advertising & what isn't

Why care about advertising disclosures?

As a general rule, advertising recognition typically leads to a more critical evaluation of claims made regarding brand/products (If consumers are unaware that a message is an ad, they may not access relevant skeptical attitudes

No Hashtag > #SP > #Sponsored > #PaidAd

> More Advertising Recognition

What is the effect of the hashtag "PaidAd"

- Increases Advertising Recognition

- Negatively impacted attitudes towards company

- Reduced viewers likelihood of sharing the post on social media

Relationship between ad recognition & consumer attitudes

Ad recognition negatively impacts attitudes and behavioral intention

True/False- The traditionally recommended top of the page position is more effective than further down the page

False- The traditionally recommended top of the page position is less effective than further down the page

Disclosure is to ________________ as Non-Disclosure is to _______________

Decreased KPIs, Negative Press/Regulatory Punishment

Sponsorship Transparency

A consumer's perception of the extent to which a message makes its paid nature and the identity of the sponsor clear

What percent of Americans found advertising practitioners to be fairly unethical/untrustworthy?

37%

What percent of Americans found advertising practitioners to be morally upstanding?

13%

The American Association of Advertising Agencies (AAAA) has blamed a lack of respect on 3 main areas:

1. Pressures for short-term earnings (agencies may use questionable imagery/messaging to break through clutter)

2. Client Pressures

3. Pressures to get/keep new business (causes agencies to treat other agencies with lack of respect)

Advertising Agencies are caught in a _____________ dilemma

Commons'

Commons' Dilemma

a phenomenon in which different members of a specific group face choices in which selfish, individualistic, or uncooperative decisions seem rational by virtue of short-term benefits, yet produce undesirable long-term consequences for the group as a whole

How does the Commons' Dilemma apply to advertisers?

The choices made by advertising practitioners can have repercussions that go beyond a single ad campaign; these choices will affect advertising's interactions with society as a whole

Ethically questionable advertising practices:

- Targeting specific populations (Children, elderly, ill, etc..)

- Sensitive Subjects (sex, rape, abortion, death, war, etc...)

- Advertising in Schools

Why does Channel One propose an ethical dilemma?

Students were forced to watch a 12 min newscast that had 2 min of advertisements throughout it

Ethically Active

Agencies that openly encourage ethical decisions and actions

- Some norms for acting ethically in certain agencies

- Recognize moral issues

- Talk about the issues with co-workers and with clients

Ethically Impaired

- Advertising people can't see ethical problems

- See primarily as only affecting themselves

- Ethical problems at other levels not seen

"Moral Myopia"

A distortion of moral vision ranging from shortsightedness, which affects an individual's perception of an ethical dilemma

"Moral Muteness"

"The absence of communicating moral concerns in settings where such communication would be fitting" & "Either not voicing moral concerns or communicating in ways that obscure moral beliefs and/or concerns

Moral Myopia Misunderstandings

- Consumers are smart

- Passing the Buck

- What is legal, is ethical

- The first amendment misunderstanding

- Going native

- The ostrich syndrome

Moral Muteness Misunderstandings

- Compartmentalization

- The client is always right

- Ethics is for bad business

- Pandora's box syndrome

"Seeing & Talking"

Recognition

- "Smart clients" recognize that being ethical is good for their business

- Advertisers' role not simply doing the bidding of the client, but to make judgements and asserting opinions as would a trusted partner

Communication

- Strong belief in the importance of overt, direct communication regarding ethical questions

Saying no

- "It's ok to get fired or resign"

Moral imagination

- Envisioning moral alternatives

Social Marketing

The process of using marketing techniques to persuade consumers to adopt the behaviors advocated by a social cause

Socially Responsible Advertising

Requires an agreement between a non-profit and a for-profit and the deal is struck to maximize perceived benefits to each partners

What do for-profit (advertiser) partner want out of socially responsible advertising?

- Associate their product with a perceived social good, boosting its appeal to a market segment that shares that perception

- Increase a broader market segment's perceptions of the enterprise as socially-engaged and responsible

- Derive bottom line benefits from increasing market share in the targeted segment

What benefit do non-profits have partnering with advertisers?

- Direct financial support

- Increased awareness

- Validation

- Possibility of gaining volunteer workers from sponsoring company

What is the difference between social marketing and socially responsible advertising?

An ad campaign using social marketing is promoting a positive action whereas an ad campaign using socially responsible advertising is promoting a product through their partnership with a non-profit.

How can advertisers demonstrate they are socially responsible?

1. Social issues linked with products (One-for-One)

2. Social issues linked with corporations (Subaru)

3. Corporate donations to social issues

What is the most common type of socially responsible advertising?

Corporate Donations (most companies already have some type of donation policy in place)

Ad Council

A nonprofit organization that helps produce public service advertising campaigns for government agencies and other qualified sponsors

- comprised of over 50 advertising and media agencies