Ethical & Legal Issues in Advertising

Prof Kunal Gaurav ICBM SBE, Hyderabad

Advertising and Promotion Viewpoints

Provides information Encourages higher standard of living

Proponent arguments

Promotes competition Helps new firms enter a market Creates jobs

More propaganda than information Critic arguments Creates consumer needs, wants Promotes materialism, insecurity, and greed

Ethics in Advertising and Promotion

Ethics: Moral principles and values that govern the actions and decisions of an individual or group.

Not all issues can be regulated

A marketing or promotion action may be legal but not ethical

Marketers must decide the appropriateness of their actions

Advertising as Offensive or in Bad Taste

Objectionable products

Sexual appeals

Shock ads

Advertising and Stereotyping

Portrayal of women to reflect their changing role in society

Gender stereotyping

Criticisms of Advertising With Regard to Stereotyping

Portrayal of women as sex objects

Sexual orientation

Ethnic stereotyping/ representation

Role of Advertising in the Economy

Makes consumers aware of products and services Provides consumers with information to use to make purchase decisions Encourages consumption, fosters economic growth

Economic Impact of Advertising

Effects on Consumer Choice Differentiation Brand Loyalty

Effects on Competition Barriers to entry Economies of scale

Effects on Product Costs and Prices Advertising as an expense that increases the cost of products Increased differentiation

Regulatory Framework