AMITY SCHOOL OF BUSINESS

SURROGATE ADVERTISING
SUBMITTED BY:MADHVI SOOD A3906408283 SECTION (G-15) BATCH (2008-2011)

ACKNOWLEDGEMENT
Preparing this report has been a great learning experience for me and I would like to express my deep sense of gratitude towards all the people who guided me throughout and without whose guidance and support, this report would not have been completed successfully. My sincere thanks to my report guide, who has been a source of knowledge and inspiration. If one believes that honesty is the best policy and truth ultimately gains, the best policy would be to stand up strongly to the dishonest practices of surrogate advertising.

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CONTENTS
PREFACE EXECUTIVE SUMMARY INTRODUCTION EVOLUTION OF ADVERTISING GOVERNMENT IMPOSES BAN ON LIQUOR & TOBACCO ADVERTISEMENTS AFTERMATH OF THE BAN SURROGATE MARKETING POPULAR EXAMPLES OF SURROGATE ADVERTISING & WHATS IN STORE

BIBLIOGRAPHY........................................................................

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PREFACE

Advertising is virtually everywhere in daily life and its forms and roles are both contested and admired. Some see advertising as both the mirror and the maker of culture: its words and images reflect the present and the past even as they contribute new sounds and symbols that shape the future. Others say that advertising is purely an economic activity with one purpose: to sell. But most of the people agree on the fact that advertising creates "magic in the marketplace." There are more than 70 television channels in India, reaching 24 million cable and satellite homes and with over 150 million viewers. Advertising budgets climb up every year. An estimated 10 million people consume Alcohol and about 250 million Indians consume tobacco in form or another, out of the 1 billion plus population. The country has a deep seated traditional conditioning against consumption of alcohol & tobacco. As a conscious effort to reduce the no. In September 1999, the Information & Broadcasting Ministry imposed a ban on airing of Liquor & Tobacco advertisements on television. The ban came as rude shock to the Liquor & Tobacco Industry, as television is one of the main media’s of communication, and any kind of ban would affect them adversely. The ban would have affected the new entrants more than the existing established players. In the absence of advertising it was but natural that the liquor & tobacco sales would head for a steep fall. The Liquor & Tobacco found the solution to there worries in what is today better known as Surrogate Advertising. According to the dictionary, Surrogate means an alternative, or a back up, or a substitute. Surrogate Advertising has been defined by the Information & Broadcasting Ministry as an advertisement of a product

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other than liquor or tobacco, when that product is actually being manufactured by a liquor/tobacco company in substantial quantity. The function of surrogate advertising is more of reinforcing brand recall, rather than an increase in the sales of the company. Soon there were advertisements from liquor companies, which had the same brand name, but a different product was being advertised. Advertisements of mineral water, soda, darts, apple juice etc became common, and had become the drivers of the brands whose brand name they carried. Tobacco companies not to be left behind came up with there own set of surrogate advertisements. One of the companies started with its own chain of lifestyle stores, while another company instituted its own bravery awards.

Thus in a nutshell ban or no ban the liquor & tobacco giants manage to create awareness of there respective brands in one way or the other.

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EXECUTIVE SUMMARY

The literal meaning of ‘Surrogate advertising' is duplicating the brand image of one product extensively to promote another product of the same brand. Advertisement, as a popular medium of paid communication has drawn public ire time and again for moving away from the truth and the consumers ‘right to know' to providing false images. The masked creative leave it to the consumers to read between the lines. Surrogate advertising is done when the original product is not allowed to advertise itself on mass media. In India, alcohol brands are not allowed to give advertisements on television, so alcohol marketing firms use surrogate products like mineral water, soda, juice to hit consumers with the brand name. The brand name of the alcohol product is the same as the surrogate product. Indian laws do not allow alcohol and tobacco companies to advertise, but a few of these advertisers have extended their brands to other categories purely in an attempt to advertise. Surrogate advertising happens when the brand extension is seen as a guise for a product that is almost non-existent in commercial terms. EXAMPLE: Kingfisher is also the brand-name of an Indian alcohol (beer). Kingfisher alcohol existed long before the Kingfisher airline came into existence. Similarly Indian Tobacco Company'''s (ITC) had their flagship brand cigarette `Wills' and then opened Wills Lifestyle stores (readymade garments) across India when Indian tobacco control Acts tightened the clamp on tobacco advertising.

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Another alcohol brand `Royal Challenge' (beer) sponsors a sport-event (Indian Premier League matches) which are broadcasted on Sony television. This time, Sony TV is likely not to screen such programmes since tobacco or alcohol sponsorship of sport events is also banned in India. Enforcing such tobacco and alcohol advertisement bans are in extreme interest of the people, public health and the country's welfare. Studies have proven how tobacco and alcohol ads use glamour and lifestyle imagery to promote their products and catch youth's fancy for their capital interests. The deadly health-hazards of tobacco and socio-economic disaster which alcohol spells on families are a reality we deal with in our day-to-day lives. However advertisement firms are going to lose Rs 250 crores of the revenue, which was earlier coming from tobacco and alcohol ads. They ask: "Why is the [tobacco and alcohol advertisement] clamp not extended to other media, such as sponsored ground events, outdoors, point-of-purchase advertising etc., which will reap our losses?" The question is indeed very valid. These bans on alcohol and tobacco advertisement should be extended to sponsored ground events, outdoors, point-of-purchase advertising etc as well. Actually the Cigarette and other Tobacco Products Act (2003) does extend the ban on tobacco advertising (direct, indirect and surrogate) to sponsored ground events, outdoors, but allows tobacco advertising at the point-of-purchase with conditions: the size of the board is fixed by law and also the content: tobacco advertisements on point-of-sale cannot display any graphic or picture or any brand name, and should only mention the kind of tobacco being sold there with 25% of board area dedicated to health warning (Tobacco causes cancer or Tobacco kills) in local language. In the year 2000, the government formed a committee headed by the then additional secretary of the Information and broadcasting ministry, which included prominent

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broadcasters to look into the issue. The committee recommended that products with real production and distribution channels cannot be called surrogate. However tobacco and alcohol companies have been promoting their products under the garb of non-tobacco or non-alcohol products with same brand names. Such surrogate advertisement does have a brand recall impact since most of the viewers associate a particular brand with the main product. For example, Royal Challenge is an alcohol for most consumers or potential consumers and not a sport!

On the one side we had the government who wanted to make sure that there were no liquor and tobacco advertisements on the television, and on the other side we had the liquor and tobacco companies who wanted to continue with television as a medium of communication and to achieve the ultimate goal of increase in sales. This battle of interest of both the sides is what fascinates me to choose Surrogate Advertising as a topic for doing my thesis.

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INTRODUCTION
In September 1999, the Information & Broadcasting Ministry imposed a ban on airing of Liquor & Tobacco advertisements on television. The ban shook the Liquor & Tobacco Industry as television is one of the main media’s of communication, and any kind of ban would affect them adversely. The ban would have affected the new entrants more than the existing established players. The Liquor & Tobacco majors were working overtime to find a solution to the crises that they were facing. They found there solution in what is today better known as Surrogate Advertising. According to the dictionary, Surrogate means an alternative, or a back up, or a substitute. Surrogate Advertising has been defined by the Information & Broadcasting Ministry as an advertisement of a product other than liquor or tobacco, when that product is actually being manufactured by a liquor/tobacco company in substantial quantity. The function of surrogate advertising is more of reinforcing brand recall, rather than an increase in the sales of the company. Soon there were advertisements from liquor companies, which had the same brand name, but a different product was being advertised. Advertisements of mineral water, soda, darts, apple juice etc became common, and had become the drivers of the brands whose brand name they carried. Tobacco companies not to be left behind came up with there own set of surrogate advertisements. One of the companies started with its own chain of lifestyle stores, while another company instituted its own bravery awards. On the one side we had the government who wanted to make sure that there were no liquor and tobacco advertisements on the television, and on the other side we had the liquor and tobacco companies who wanted to continue with television as a medium of communication and to achieve the ultimate goal of increase in sales. This battle of interest of both the sides is what fascinates me to choose Surrogate Advertising as a topic for doing my dissertation.

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RESEARCH DESIGN
Exploratory research design has been used for the project. The main purpose of using this design is for getting a solution to a problem for more precise investigation. The major emphasis in such studies is on the discovery of ideas and insights. The research design must be must be flexible enough to provide opportunity for considering different aspects of a problem under study. The design of exploratory studies is characterized by great flexibility and ad-hoc versatility. The researcher is involved in investigating an area or subject about which he or she has yet to gain a proper knowledge about the subject. This type of study is conducted in the following situations: 1. To get solution to a problem for the further investigating. 2. To determine the priority for further research 3. To gather data about the practical problems of carrying out research on particular problem statements. 4. To increase the analyst’s interest in the problems to explain and understand basic concepts. Flexibility in research design is needed because the research problem is transformed into one with more precise meaning in exploratory studies, which may necessitate changes in the research procedure for gathering relevant data. The researchers purpose is to first conduct a intensive secondary research to understand the full impact and implication of the industry, to review and critique the industry norms and reports, on which certain issues shall be selected, which the researchers feel remain unanswered or liable to change. This shall be further taken up in the next stage of exploratory research. This stage shall help the researchers to restrict and select only the important question and issue, which inhabit growth and segmentation in the industry.

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Methodology Used- The information presented in the dissertation has been gathered from Secondary data. In order to collect the primary data, questionnaire was prepared to derive details on what is the opinion of the common man & the people in the advertising sector, about surrogate advertising and its effectiveness. In order to make the dissertation more precise rather than covering the entire scope of surrogate advertising, the focus of the study has been confined to the liquor & tobacco industry, where the surrogate advertising emerged as a consequence of the ban imposed by the Information & Broadcasting Ministry on the advertisement of liquor & tobacco.

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EVOLUTION OF ADVERTISING
Advertising is hardly a new phenomenon. Even a hundred years ago, advertising was an integral though sometimes unwanted part of daily life. Over the centuries, the evolution of advertising has been closely tied to social, economic and technological changes that have affected the media and the message. We would study the evolution of advertising under the following heads: The Early Days: These were the days when public education was low, few people could read, and so for centuries trades people attracted attention with public criers and pictorial signs. Some Greek and Roman traders also used signs to advertise their products, as people could not read. When Johann Gutenberg invented movable type and the printing press in Germany in the mid 1400s that printed materials could be mass-produced. This led to printed pamphlets being distributed and also some primitive forms of today's billboards. The Industrial Revolution: The Industrial Revolution and the subsequent shift from rural to urban centers and the widening of the gap between producers and the consumers, the businesses turned to advertising quickly to reach out their potential customers. Technological Changes: During and after the Industrial Revolution, technological advance changed both the speed and form of communication. This can be attributed to the fact that photography was invented and along with telegraph, telephone, typewriter, phonograph, and motion pictures opened up new avenues for personal and business communication. However, the inventions of radio and television changed the face of advertising forever as

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print and electronic media expanded the use and impact of advertising. We discuss a few of them in brief: Print Media: This would include the magazines and the newspapers. Today's newspapers and magazines offer advertisers the flexibility of targeting the audience ranging from a small local area to the whole nation or the continent. By the dawn of the twentieth century, advertising had become a social and economic fixture in the U.S. and U.K. and all the magazines and newspapers were being filled by ads of different companies and varied products. Today also the print media is an effective mode of advertisement. Electronic Media: The electronic media would include radio and the television. The advent of the radio allowed the advertisers the liberty of using certain 'jingles' and music, which could be associated with their brand and product. Whereas the television brought along the visuals along with the audio effects. This was a revolution and the print media found it being sidelined as far as advertising went. Talking of India, the Cable TV boom in the early nineties added to the choices available to the advertiser on a regional segment.

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GOVERNMENT IMPOSES BAN ON LIQUOR & TOBACCO ADVERTISEMENTS

THE CABLE TELEVISION NETWORKS (REGULATION) ACT, 1995[1]
7. Advertising Code. - (1) Advertising carried in the cable service shall be so designed

as to conform to the laws of the country and should not offend morality, decency and religious susceptibilities of the subscribers. (2) No advertisement shall be permitted which(i) Derides any race, caste, colour, creed and nationality; (ii) Is against any provision of the Constitution of India. (iii) Tends to incite people to crime, cause disorder or violence, or breach of law or glorifies violence or obscenity in any way; (iv) Presents criminality as desirable; (v) Exploits the national emblem, or any part of the Constitution or the person or personality of a national leader or a State dignitary; (vi) In its depiction of women violates the constitutional guarantees to all citizens. In particular, no advertisement shall be permitted which projects a derogatory image of women. Women must not be portrayed in a manner that emphasizes passive, submissive qualities and encourages them to play a subordinate, secondary role in the family and society. The cable operator shall ensure that the portrayal of the female form, in the programmes carried in his cable service, is tasteful and aesthetic, and is within the well established norms of good taste and decency; (vii) Exploits social evils like dowry, child marriage. 7(viii) Promotes directly or indirectly production, sale or consumption of(A) Cigarettes, tobacco products, wine, alcohol, liquor or other intoxicants;

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(B) Infant milk substitutes, feeding bottle or infant food. (3) No advertisement shall be permitted, the objects whereof, are wholly or mainly of a religious or political nature; advertisements must not be directed towards any religious or political end. (3A) No advertisement shall contain references, which hurt religious sentiments. (4) The goods or services advertised shall not suffer from any defect or deficiency as mentioned in Consumer Protection Act, 1986. (5) No advertisement shall contain references which are likely to lead the public to infer that the product advertised or any of its ingredients has some special or miraculous or super-natural property or quality, which is difficult of being proved. (6) The picture and the audible matter of the advertisement shall not be excessively ‘loud; (7) No advertisement which endangers the safety of children or creates in them any interest in unhealthy practices or shows them begging or in an undignified or indecent manner shall not be carried in the cable service. (8) Indecent, vulgar, suggestive, repulsive or offensive themes or treatment shall be avoided in all advertisements. (9) No advertisement which violates the standards of practice for advertising agencies as approved by the Advertising Agencies Association of India, Bombay, from time to time shall be carried in the cable service. (10) All advertisement should be clearly distinguishable from the programme and should not in any manner interfere with the programme viz., use of lower part of screen to carry captions, static or moving alongside the programme.

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AFTERMATH OF THE BAN
The industry and the advertising fraternity were caught off guard, when the government imposed restrictions on airing liquor and cigarette ads on television, early this year. This prompted the advertising agencies to evolve in their communication strategy. What emerged out of it was even more unfathomable. Surrogate advertising became the newage mantra, raising the issue of ethics in advertising as always. While the industry scouted for new products to associate with their brands, ad agencies burnt their gray cells to conceive creative ads, to subtly promote the brand over the new product. The ban has divided the entire industry between multinationals and local home grown companies. From the point of view of Indian players', the biggest threat today is the entry of global majors who will have an unrestricted license to sell as the free import regime as per the WTO commitment comes into force from March 2001. These MNC’s not only have well known brands, but also have deep pockets. And advertising is their most potent weapon. Television would be the quickest and the most effective way to reach the maximum number of people, throughout the country, in the shortest possible time. Print media has its own shortcomings, with the multiplicity of languages that people speak in India. Also print media cannot beat the effectiveness of the audiovisual medium of television. The impact of ban on various industries -:

TOBACCO
The likely fallout’s of the ban on cigarette sales could be

Cigarette volumes, which have been registering diminishing growth, could decline further if restrictions on smoking in public places are implemented strictly. Domestic industry players will be at a disadvantage to their international counterparts who enjoy free access to communicate on television channels uplinked from outside India and seen in the country by a very wide cross-section of the population.

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New brand launches would become extremely difficult. ITC with its wide brand portfolio consisting of the most well known brands in the country and the widest distribution reach among the cigarette companies is better placed than any other competitor in an atmosphere where no advertising is allowed.

LIQUOR
Domestic liquor majors have been facing increasing competition from international brands launched in the country by leading global liquor majors post removal of restriction on imports. Restriction on the most effective medium of advertising i.e. television would obviously hamper brand building. The ban on liquor advertising has in a way it came as a blessing in disguise since it created an entry barrier for any new prospective player. McDowell has used this ban to its advantage by using surrogate advertising for products like mineral water and soda, which also generated additional revenue for the company. With a view to actively develop this area, the company has franchised the bottling and sale of McDowell’s purified drinking water and soda, which are now available in over 75 cities in the country. The company is also planning to launch cigars in a high price range, which it plans to import and sell under its own brand name. It is primarily focusing on the youngsters as its target market with its USP being that cigars are less harmful than cigarettes. These areas used by the company for surrogate advertising have been identified to be yielding high-margins, especially if one compares with the present margins in the liquor industry. Global players who are already in the market such as Bacardi, Pernod Ricard, UDV, Fosters, etc, who would have been relying on building up their brand equities in the local markets are in for a tough time. It could even have some fall out on the considerations of some global players who have not yet firmed up India plans. Another big advantage that smaller domestic players will have is that they will become more attractive acquisition targets, if not for their brands, at least for their distribution reach which will now be even more critical in a scenario of restricted advertisements.

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``As long as there was no ban, companies were not interested in showing liquor advertisements in the garb of social messages. But with the government imposing restrictions, social messages are a route to liquor advertising for many.''

MEDIA
The 7 to 11 per cent revenue hit, amounting to over Rs 100 crore annually, that the Indian television industry faced after the ban on direct and indirect liquor and tobacco advertisements. According to industry sources, all the leading private channels are experiencing revenue losses due to the ban. Star TV, for instance, which used to show the popular Bacardi advertisements among others, has suffered around 8 to 10 per cent loss of revenues after the recent ban. Says Mr LS Nayak, executive vice-president, sales and marketing, Star, that since the broadcasting industry had already taken off most of the tobacco ads, the current revenue hit was only due to removal of liquor ads. Q. With the IBF guidelines on surrogate advertising in force, do you see TV channels suffering heavily? A. Raj Nayak, Executive Vice-President - Sales and Marketing, STAR India: “Not really. It is more of a misconception. There has hardly been any cigarette advertising on television as TV companies do not accept tobacco ads. Even if you look at surrogate advertising of tobacco products, it is very minimal. In comparison surrogate advertising of liquor products has been higher. However, when we took stock of the situation in terms of the total volume of business in the last one year, surrogate advertising of liquor products did not account for a sizeable portion of our business. Gutka and pan masala advertisers definitely spend a lot on television. However, when you spread their monies across various channels, it is not a huge sum of money”. Zee says its revenue loss is 2 per cent. It's like a drop in the ocean, says the Zee spokesperson. But, warn industry sources, that Zee's projection should be taken with a

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pinch of salt. Sony Entertainment Television (SET), another channel to get hit by the liquor ban, puts its revenue loss at 5 to 7 per cent. Says Ms Kacon Sethi, head of sales, Sony: ``We don't have any specific plans to overcome the revenue loss due to ban on liquor ads.'' But she adds that with surrogate ads continuing, some of the liquor brands continue to stay on the channel. B4U, the Kishore Lulla-promoted channel which was airing a lot of liquor ads such as United Distillers and Vintners (UDV), Gilbey's Green Label Whisky and Smirnoff till recently, is not forthcoming on its revenue loss figure. In fact, B4U continued airing liquor ads much beyond the ban deadline. The channel was in the process of striking further deals with the UB Group, Shaw Wallace, Radico Khaitan and Mackay, when the government issued an ultimatum to the channel to stop all liquor ads. "Event marketing has benefited sports, fashion and music. For instance music got quite a patronage with the Charms Spirit of Freedom Concerts featuring Indian classical music to the Western bands such as Rock Machine. The companies have an advertising budget maximum of which is spent on television. Advertising agencies have taken a stance that it's unfair to ban advertising, since the product itself is not banned. "If the product will continue to be produced and marketed, there is no point in restricting its advertising," they generally feel. Also, as stated above, there are no means to check surrogate advertising. With no control on surrogate ads, channels are showing ads of soda, water and even T-shirts being manufactured by liquor and tobacco companies during the day also, thereby influencing a lot of young people.

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SURROGATE ADVERTISING
Tobacco & liquor advertising does more than offer a high; it promises a sophisticated lifestyle that stems merely from holding a cigarette or hard drink. In India, the advertising industry has been largely self-regulated. To circumvent the regulations, advertisers have frequently used methods such as "surrogate advertising" to promote such products. Surrogate advertising is the promotion of a product, through indirect and devious means. Typically, an advertiser would use the trademark/brand of a product for which promotions are restricted/prohibited to promote a product the advertisement of which is permitted. For instance, it is not unusual to find a brand associated with cigarettes to be used to advertise a competition/event. The advertising of socially harmful products such as tobacco and alcohol has been sought to be restricted by Indian lawmakers. Such prohibitions were, however, previously limited to forms of media such as terrestrial television and radio which were easier to regulate. With technological advances such as satellite television and the Internet, advertisers have been finding ways to circumvent restrictions to achieve their goals. SOURCE: The Economic Times (Corporate Counsel section),June 14, 2003. The literal meaning of ‘Surrogate advertising’ is duplicating the brand image of one product extensively to promote another product of the same brand. Advertisement, as a popular medium of paid communication has drawn public ire time and again for moving away from the truth and the consumers ‘right to know’ to providing false images. The masked creative leave it to the consumers to read between the lines.

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This advertisement gimmick has its genesis in U.K., where English housewives protested against liquor advertisements as.they felt that these ads were weaning their husbands away from them and hence perceived as a threat. The liquor and the tobacco barons not only in U.K. but also in other countries including India dealt with resistance by advertising cocktail mixtures, fruit juices, apparel, etc. The imagery used in most of the commercials is that which one can associate with alcohol. Apart from brand names they assort the products with seems like machoism, scantily clad girls, dim lights, people partying and doing merry together. In ad parlance,‘surrogate advertising’ is a politically correct term used to define fraudulent pieces of communication. For example, all those playing cards, soda water bottles, apple juices, mineral water and other product ads we see, are actually clever promotions for liquor and cigarette brands by the same name. Let’s take an example how it works. To explain…..a party is going in full swing, guests are enjoying their drinks and chatting away. A gentleman finishes his drink and hands over the empty glass to the waitress. Another lady also finishes her drink and places the glass on the tray. On both the glasses ‘AC Black Apple Juice’ is printed. As the waitress carries the empty glasses, the two AC Black ones knock against each other. In the next shot a kind of mysterious force pulls the two guests, who bump against each other. While waitress continues to carry the tray, the two glasses keep brushing against each other… and so do the young couple. Even as the dance between the two glasses goes on in full

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scale, the impact is felt in equal strength by the couple. The glasses are taken for a wash, and are placed under the rush of tap water. Continuing with the pattern, the young dancing partners too find themselves in pouring rain. Finally having cleaned the glasses, the waitress keeps them for drying, placed beside each other. The amazed guests look on as the couple also stands immobilized side by side. The voice over says: "AC Black Apple Juice, kuch bhi ho sakta hai" (Anything is possible). In addition, brand imagery can be communicated without reference to cigarettes. This is evident in the evolution of the current Four Square campaign. Some of the Four Square campaign storefront and bus stop advertisements contain the black and white photograph with a man holding a red square on one end and an open pack of cigarettes on the other; others just contain the photograph with the text, "four square the man with the smooth edge" and three red squares. The Four Square billboards, posters, and magazine advertisements are composed solely of the photograph, the logo, and the slogan; the only mention of cigarettes is in the statutory warning..

What’s surrogate about advertising?
The I&B Ministry had instructed the TV channels not to carry surrogate advertising. This was in addition to the news that cigarette packets would now have to carry “gory” pictures, ostensibly to scare away smokers and thereby save their lungs and their lives.

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Let’s take the second point first. The picture of a scorpion on a cigarette packet is probably the most ludicrous attempt at scaring anyone away. It is this propensity of the Government to convert its feeble attempts at regulating the powerful tobacco lobby that never ceases to amaze me. If the smokers do not die of lung cancer after merrily continuing smoking cigarettes from packets that carry the scorpion picture, they will surely die of laughing at these half measures. That brings us to the first point. Every so often one reads of the “strict” rules that ban tobacco and liquor advertising. And every so often one views advertising of CDs, cassettes, events, mineral water, stores, airlines, awards and any other product with the brand names of major tobacco and liquor companies on television, newspapers, magazines and on hoardings. Let’s examine the case for and against surrogate advertising from different perspectives. The advertiser’s perspective is fairly straightforward. If it is legal to manufacture, distribute and sell a product, why should it be illegal to promote the sale of that product? I don’t think anyone can answer that question convincingly. If it has been established conclusively that cigarette smoking kills, why is it that it is available to anyone, irrespective of his or her age, at every street corner? And even if surrogate advertising for cigarettes is effectively banned, what about events on satellite TV that are sponsored by tobacco and liquor companies? Tune into the coverage of Formula 1 racing at you will see cars racing around circuits of the world with the names and logos of tobacco and liquor companies emblazoned on every part of the vehicle and the driver. Does this mean that ITC cannot advertise its products in Indian events even though it is a major contributor to the exchequer in terms of excise and duties, while Marlboro, which is smuggled freely onto the streets of India, can subliminally implant itself in the minds of the smoking public that watches this coverage? Assuming that tobacco companies even have a case to advertise, one would at least ask for a level playing field. What about the advertising agency’s point of view? I frankly don’t think they have one. They will implement strategy for their clients, execute jobs irrespective of whether they are legal or not and try and shore up their bottom line. If this was not the case, you would not have surrogate advertising.

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Now let’s think of the consumer. Well, as a consumer, I cannot plead that I should have the right to do what I wish, including the consumption of tobacco in whatever form. That would perforce mean I have the right to commit suicide. And society and statute does not give me that right. Having got that out of the way, I would have to agree that society in its wisdom and the law in its majesty enjoins certain restrictions on me and my public behaviour, and if I do not agree with such restrictions I have the right to appeal against them to the judiciary or lobby for legislative change. In the meanwhile, I am expected to be a law-abiding citizen. Sounds very simple and straightforward. Then why is there surrogate advertising? Does it mean that those indulging in it are not law-abiding citizens? The short answer is “yes!” Tobacco and liquor companies have the right to knock on the doors of the judiciary and the legislature to seek redress from rules or laws they feel are unfair or wrong. God know they have the money, legal wherewithal and political patronage to do all of these things. If they have not been able to do it, it means that surrogate advertising is not just legally wrong but also unconscionable. And that is the point I want to make. Advertisers such as United Breweries went ahead and set up an airline with a brand name, colour and logo style that was the same as a liquor brand they owned. Advertisers like ITC went ahead and set up a chain of lifestyle stores under the name and style of a cigarette brand they owned. This was when there were already rules and laws in place that expressly forbade this. Today we have a large airline that is a legitimate business called Kingfisher. And a large chain of lifestyles stores called Wills. An equally legitimate business. Yet, even Vijay Mallya would not be able to tell you with a straight face that his airline was named Kingfisher at a time when it was legal to do so. Nor would Yogi Deveshwar. And they are both honourable men. If the Government was serious about enforcing its rules and laws it could have put a stop to these names years ago. It was expedient to allow them to grow into large legitimate businesses and then deem them legitimate. Now one can say that you cannot have a product (other than the liquor brand) called Seagrams 100 Pipers. That merely locks the

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doors after the horses have fled. How will you decide that a business is legitimate or not? Would Bacardi Blast cassettes and CDs be seen as legitimate. Of course it would be. Would any of these be “right”? Certainly not. The point to note is that there is nothing surrogate about advertising. There is something surrogate about ethics and values and a sense of right and wrong. And so you have an actress who was hailed as the only “man” in Bollywood endorsing a bravery award named after a cigarette brand. And you have pious corporate social responsibility programmes from a tobacco company that freely endorses surrogate advertising. And you have a Member of Parliament whose intentions could definitely be construed to point at encouraging surrogate advertising. Forget the advertising agencies. They are too small in this game. Advertisers must decide what is right and what is wrong. And the consumer must be the ultimate judge. Do you want to patronise the products and services of companies who are legally correct, or really correct? That’s a choice you have to make. The advertising is purely incidental. Surrogate Advertising - The Positive Side When the laws of a country do not permit advertising of a certain product category, the advertisers take the shelter of a brand extension. Advertising of alcoholic drinks in India is not permitted. To by pass this, some manufacturers of whisky or similar products launched brands of soda, mineral water under the same brand name as that of their popular whisky. Hence the meaning of ‘Surrogate advertising’ is duplicating the brand image of one product extensively to promote another product of the same brand.

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POPULAR EXAMPLES OF SURROGATE ADVERTISING & WHATS IN STORE

Todays media is full of examples which bring out the best of surrogate advertising. Even the event marketing of sports, fashion & music has not been spared from surrogate advertising. The alcohol based brand sponsor sports and receives visibility via advertising and below-the-line marketing. Brief examples along with modus operandi have been mentioned below. Celebrity endorsements with Shatrughan Sinha for the Bagpiper soda to the leading stars such as Akshay Kumar for the Red & White Bravery Awards while Johnny Walker Scotch Whisky promotes a series of successful stories on the T.V. channel-CNBC India through sound bytes like Amitabh Bhachan. Event marketing has benefited sports, fashion & music. The alcohol based brand sponsors sports and receives visibility via advertising and below-the-line marketing. Seagram-the producer of the premium whisky Chivas Regal have been promoting Chivas Regal Championships and Chivas Regal Invitational Golf Challenge for corporate executives. United Breweries group been associated with formula one racing since long through its flagship beer brand king fisher, Mc Dowell & Co. has associated its umbrella brand McDowell with sport of derby. While the most interesting amongst them is the Hayward’s 5000 beer, which uses dart boards as their surrogate product in their ads and the brand has gone one step further by associating itself with a new sport ‘darting’ and is sponsoring national dart championships. Wills Life Style is a chain of specialty stores providing exclusive designer collection. At 2003 Images Fashions Awards, Wills Life Style was declared ‘the most admired exclusive retail chain of the year’. Hence the stores serve as effective brand wagon for the cigarette brand. Another glaring example in this field is Manikchand-a major gutka manufacturer who sponsor Manikchand-Filmfare Awards and promotes its brand name. WITH the Government trying to clamp down on surrogate advertising, liquor companies seem keen to bat out the ban. Even as liquor brands have traditionally been associated

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with upmarket sporting activities like golf, polo, derby and yachting, companies are now turning towards the game of the masses - cricket. In fact, the latter half of the current year will see liquor brands as the title sponsors of two major cricketing events featuring India. Immediately after the triangular series at Zimbabwe (of which Royal Stag was the associate sponsor), the India and Zimbabwe Test series will be called the Royal Stag Cup. Till date Royal Stag has used several international cricketers as brand endorsers. This is the first time the company has forayed into tournament sponsorship. Similarly, the ICC World XI Vs Australia series to be held Down Under will be called the Johnnie Walker Super Series. According to media planners, as both the series are being held outside India it would be difficult for the Government to blip out the liquor brands. "Since the matches will be beamed into Indian drawing rooms live, the brands will enjoy good visibility," they added. Internationally beer brands such as Fosters and Lion have supported cricket in Australia and Sri Lanka respectively. Meanwhile, Royal Stag has roped in Zimbabwean ViceCaptain, Heath Streak as their new Royal Stag brand ambassador. Other celebrity Royal Stag cricket endorsers include Australian Cricket captain Ricky Ponting, and India's Harbhajan Singh. The Information and Broadcasting (I&B) Ministry's efforts to ban surrogate advertising of liquor brands has reached a naught. A few months ago, it had sent out notices to various television channels to withdraw advertisements by liquor companies. But within a few weeks of the notices being issued, surrogate advertising made a comeback on television. In fact, a few liquor companies have been advertising during the ongoing cricket series as well. Earlier, in an interaction with Government officials, channels were categorically told that there is a complete ban on advertising by liquor companies. "However, exemptions could be granted on a case-by-case basis, like the one granted to Kingfisher Airlines," they had said. The Government is also handicapped by procedure wherein it can take action against channels only after receipt of complaints. "The Government cannot suo motu issue showcause notices. It has to first receive complaints," said official sources.

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Liquor companies on their part state that their advertising is self-regulated and comply with the Indian Broadcasting Foundation and the Advertising Standards Council of India code.

OPINIONS:
Mr Prasoon Joshi, Regional Creative Director of McCann Erickson-"It is a grey-area. Whether or not surrogate advertising should be allowed has been constantly debated in the industry. There is no one solution. I myself have not come to a conclusion. Abhishek Khaitan, Executive Director, Radico Khaitan -"Surrogate advertising ban would not hamper our plans to a large extent because there are a number of alternative media through which you can always address your consumer." Q. Like all other players you have also taken to surrogate advertising by launching 8 PM apple juice. How successful has this been in terms of brand awareness of 8 PM whisky? Answer: Abhishek Khaitan, Executive Director, Radico Khaitan-8 PM advertisement has always been admired by the consumer therefore the recall that we have or enjoy with our consumer base is phenomenal as compared to other brands. Apple Juice was an extension to this only and therefore has helped us in retaining the same. I would not say 8 PM Apple juice is a surrogate product. It is just an extension of our business and this sector has been doing well and contributing to our revenues. We are looking at other flavours of juice. 8 PM is our brand extension and a legitimate product. Rather, the image of 8 PM whisky helped us sell the apple juice”. Q. With surrogate advertising also on in danger of being banned what do you plan to do? What will happen to your surrogate products? What is the media strategy that you would adopt? Answer: Abhishek Khaitan, Executive Director, Radico Khaitan-Surrogate advertising ban would not hamper our plans to a large extent because there are a number

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of alternative media through which you can always address your consumer. As far as our strategy on this account is concerned, we would not like to reveal that at this juncture. Q. Surrogate advertising; do you think it achieves its objectives? Answer: R Balakrishnan, Lowe Executive Creative Director-Surrogate advertising achieves its objectives as long as people don't believe its surrogate. As long as people know what product is being promoted, it's not surrogate advertising. Q. What kind of loss is the industry looking at with the ban on tobacco ads? Answer: R Balakrishnan, Lowe Executive Creative Director -Huge. Quite a big loss. To put together the whole tobacco advertising industry, it would be about a Rs 200 crore (Rs 2 billion) loss. Lowe did not handle a lot of cigarette business. Q. Why surrogate advertise at all? If something is not allowed to be advertised at all why, this loophole? Answer. Harish Bijoor, Brand-Domain Specialist and CEO, Consults- Surrogate advertising is the biggest loophole we have in this large pie of legal advertising. I categorise products and services that we tout as brands into two categories. The first is the socially acceptable category. The second is what I dub the “social ostracism” category. Items that fall in the first category are products and services that are legal. Products that have positive social sanction and products that do not contravene the law of the land in touting of the product. Products that don’t go against social sanction and societal niceties as well. There is therefore in modern marketing society a caste hierarchy of products and services. Legitimate products that enjoy social acceptability and sanction sit right on the peak of this caste structure. The bread you eat and the soap you use to bathe and indeed the water you drink out of bottles and pay more than what you pay for the litre of milk, are all at the top rung of the caste ladder we build for brands. And then slightly below each of these highly legitimate products are items of luxury. The real top end luxury sedan! That Swarovski crystal duck that costs more than what a family of four can feed and clothe themselves with for a whole five years! These are categories that are legitimate but cue the top end of the consumptive race and its peccadilloes.And then, right at the bottom of the legitimate products pyramid lie products

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and services that do not enjoy social sanction. These are brands that walk just above the thin Plimsoll line of social acceptability and sanction. These are products and services that defy issues related to health and well-being. At times these are products and services banned by governments at large in the interest of their people and processes at large. Some of these products and services are items such as cigarettes and liquor which go on the platform of health and social sobriety. And then there are services such as the longdistance ostensibly “Friendship Calls” that are advertised at times to lure the gullible to listen in to a foreign voice that is more interested in your ISD call charges piling up than your friendship. And then there is Chewing Gum, which is banned in Singapore! And of course of late we had issues in India with the banning of political party campaigns on the electronic medium! In all cases where there is a ban on advertising of the product and service, clever marketing people seek to overcome such bans through the use of surrogate means. Therefore, Kingfisher (which is incidentally a bird to start with) is an aggressively advertised Mineral Water as well! And 8 PM is an Apple Juice! And then there are aggressively advertised Playing Cards, brand advertising budgets of which must be gobbling up more than a hundred times the turnover of the product category in question itself! Surrogate advertising of all types has a limited life span in our society as of today. Wait for a comprehensive ban on all kinds of surrogate advertising soon! And this is when the Wills Lifestyle store just might have to change its name altogether, bowing to the law of the land. Real stringent laws of the land! Vijay Rekhi, UB Spirits Division President- UB's Bagpiper Soda and McDowell's water have sold 1.5 million cases and yet were being treated on par with the non-existent product extensions of other liquor companies. INSIGHT ON THE TOBBACO INDUSTRY Some Quick facts  Cigarettes cause about 6.35 lakh deaths in India every year.  Two and a half thousand Indians die every day from smoking related diseases one every 40 seconds.  About 33 per cent of cancer cases are attributed to tobacco consumption.

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 However, cigarettes alone account for roughly 10% of excise collections.  Tobacco trade is a major contributor to the national exchequer. With declining markets in the West, and 50 per cent of India's population under the age of 25, the major tobacco companies are increasingly targeting India as their new growth market. Already, 250 million Indians use tobacco, and the market's already worth a massive $5 billion. And they don't only smoke it: many Indians chew tobacco, mixed with lime, spices and other substances - some of them possible carcinogens. As a result, India has one of the world's highest rates of mouth cancer.

It's more than sponsorship, says Suhel Seth, who used to be in marketing with the Indian Tobacco Company (ITC). "It's very careful target marketing where they're looking at young people who watch the sport, who are almost fanatic about it see their icons being associated with a cigarette brand. . . Cricket is the only common religion in India."

The Indian smoking tobacco market is dominated by the indigenous bidis in volume terms. Bidis are stronger and cheaper than white cigarettes, and are the preferred smoke of Indians across the country but especially in the northern regions. The bidi industry enjoys political protection, and is not so heavily taxed, even though bidis have a higher nicotine content. Cigarettes account for only 18.8% of domestic tobacco consumption in India. Bidis account for 53.5%, and the balance is mainly non smoking tobacco (NST) products. According to estimates by the World Health Organisation (WHO), 8 lakh persons die from tobacco related diseases every year in India alone, with every cigarette reducing the life of smokers by 5.5 minutes. The economic and health costs of this consumption are staggering, considering that 60 per cent of the Indian population accesses health care by taking on loans or by selling property & assets. Volume consumption of cigarettes declined sharply in 2001. The share of cigarettes in tobacco consumption has been declining steadily, falling to a record low of 87.8 billion sticks in March 2004, down from its peak at 104.2 billion sticks in March 1998. Cigarette sales have been adversely affected by rising excise duties and legislation against public smoking. There has been a movement in consumption patterns towards smokeless

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tobacco .Retail sales of manufactured cigarettes are also being adversely affected by contraband, the volume share of which is estimated to have risen to nearly 12% in 2002, from 1% in 1997. Traditionally, contraband is strong in the premium end, but more recently it has also been growing in the economy price band segment The concept of low tar or low nicotine is not significant in India. The standard varieties in cigarettes are Kings, Filters and Minis India’s leading tobacco manufacturer ITC reported a 4% growth in cigarette volumes year-on-year for the period April to August 2002, compared to a decline of 9% in the same period in 2001. Its two competitors Godfrey Philips India and VST also reported some growth in sales volume over the same period Prices of cigarettes have been rising constantly, with the excise duties on cigarettes increasing each and every year from 1998 up to 2001. Duties were left unchanged in 2002 giving some stability to prices The current view in the industry is that cigarette sales are in decline and that the habit has become less popular with the young There have been increasing problems for the domestic cigarette industry. Smoking is being gradually curbed in public places. There is growing health consciousness among the premium cigarette smokers Growers and manufacturers realize that diversification is the only long-term solution available to the industry State Governments are becoming more stringent with their regulations: smoking on railway platforms is strictly prohibited and a number of companies are making their entire premises smoke free

More recently
Advertisers such as United Breweries went ahead and set up an airline with a brand name, colour and logo style that was the same as a liquor brand they owned. Advertisers like ITC went ahead and set up a chain of lifestyle stores under the name and style of a cigarette brand they owned. This was when there were already rules and laws in place that expressly forbade this. Today we have a large airline that is a legitimate business

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called Kingfisher. And a large chain of lifestyles stores called Wills. An equally legitimate business. Yet, even Vijay Mallya would not be able to tell you with a straight face that his airline was named Kingfisher at a time when it was legal to do so. Nor would Yogi Deveshwar. And they are both honorable men. If the Government was serious about enforcing its rules and laws it could have put a stop to these names years ago. It was expedient to allow them to grow into large legitimate businesses and then deem them legitimate. Now one can say that you cannot have a product (other than the liquor brand) called Seagrams 100 Pipers. That merely locks the doors after the horses have fled. How will you decide that a business is legitimate or not? Would Bacardi Blast cassettes and CDs be seen as legitimate. Of course it would be. Would any of these be “right”? Certainly not. The point to note is that there is nothing surrogate about advertising. There is something surrogate about ethics and values and a sense of right and wrong. And so you have an actress who was hailed as the only “man” in Bollywood endorsing a bravery award named after a cigarette brand. And you have pious corporate social responsibility programmes from a tobacco company that freely endorses surrogate advertising. And you have a Member of Parliament whose intentions could definitely be construed to point at encouraging surrogate advertising. Forget the advertising agencies. They are too small in this game. Advertisers must decide what is right and what is wrong. And the consumer must be the ultimate judge. Do you want to patronise the products and services of companies who are legally correct, or really correct? That’s a choice you have to make. The advertising is purely incidental.

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RENFOURCEMENT OF BAN & OTHER MEASURES TAKEN BY GOVERNMENT
Following the restriction on advertising and ban on sports sponsorships last year, Cigarette companies such as ITC and VST, and liquor companies such as UDV, McDowell, UB now face another hurdle. The Information and Broadcasting Ministry is planning to go hard on surrogate advertisements by cigarette and liquor companies. The Ministry has already clamped down on two brands - McDowell No 1 and Gilbey's Green Label - which have been using surrogate advertising extensively to sell liquor. The Ministry had issued show-cause notices to broadcasters such as Star, Zee, Sony and Aaj Tak seeking explanation why action should not be taken for violation of Rule 7 of the Cable Television Networks Rules, 1999 for carrying surrogate advertising on liquor & tobacco. The so called surrogate ads under scrutiny are: McDowell’s Mera Number One, Gilbey’s Green Label ads, Bagpiper soda water, Kingfisher mineral water, 8PM apple juice, ITC-GTD’s (greeting cards division) Expression Greeting Cards, Red & White Bravery Awards and Wills sportswear. According to Rule 7 (2) of the Act, no broadcaster is permitted to show advertisement which promotes directly or indirectly promotion, sale or consumption of cigarettes, tobacco products, wine, alcohol, liquor or other intoxicants, infant milk substitution, feeding bottle or infant food. Both Zee and Star have agreed to withdraw the ads, while the other channels are expected to follow suit. Five other brands have come under the magnifying glass now - Charms cigarette, Smirnoff Vodka (both of which sell audio cassettes and CDs), Haywards 5000 (darting kits), Royal Challenge Whiskey (Golf Accessories) and Kingfisher beer (Water). A committee has been set up to look into the issue. The committee will review various advertisements and determine whether a particular advertisement would be categorized as surrogate advertising or not. The advertising of products would be considered surrogate if there was a clear recall of the actual products. The clamping down on surrogate advertising will weigh heavily on these companies. Domestic liquor majors have been facing increasing competition from international

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brands launched in the country by leading global liquor majors post removal of restriction on imports. Restriction on the most effective medium of advertising ie television would obviously hamper brand building. The cigarette majors too have been facing diminishing growth in volumes for the last few years and rising competition from cheap smuggled products. Brand strengthening activities would naturally be curtailed if the ban on surrogates were implemented effectively. It remains to be seen if Retailing Initiatives under the Wills Lifestyles brand by ITC is also considered a form of surrogate advertising. Or will the ITC clout be strong enough to convince the regulators that Retailing is a full-fledged business undertaken by ITC. As of August 2006, the government had taken a lenient view and allowed advertisements of products with the same name as cigarettes or liquor to be aired if there are no direct or indirect references to such 'prohibited' products. But the new notification issued in February 2008 that puts a total ban on tobacco and alcohol commercials on TV has put commercial interests and existing contracts amongst advertisers and broadcasters in a bind. Some of the other measures taken by the government are as follows

CURB ON TOBACCO
 Union

Health Ministry has issued directives banning all smoking scenes in films

as well as on television.  Ban smoking in public places  Forbids sale to persons below the age of 18 years, to discourage adolescents from consuming tobacco products  No person engaged in tobacco products-related activity will advertise and no person having control over media shall advertise tobacco products

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ANALYSIS OF THE PRIMARY DATA
In order to have broader & balanced sample, there were two target segments that were identified first being the advertising companies who actually understand the market, analyze the requirement of the client & the target customers and accordingly design advertisements to communicate the desired message effectively.

The second target segment consists of people from diverse backgrounds or the general segment, who are the main consumers. The questioners were distributed to advertising companies and also to individuals or general public (consumers). While out of the total hundred questionnaires, twenty were given to people in advertising sector, eighty questionnaires were given to individuals from diverse background.

Q.1 Do you think we require any ban on Tobacco & Liquor advertising?
Openion of Respondents (%) 100 90 80 70 60 50 40 30 20 10 0 Advertising General Segment Overall 5 64 56.25 43.75 36 Yes No 95

Advertising SegmentA staggering 95% of the sample from the advertising companies felt that a ban should be imposed on advertising of Tobacco & Liquor. As low as 5% of the sample from the Advertising companies, believes that a ban on advertising of Tobacco & Liquor is not required.

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OthersAmongst the sample, other than those from advertising segment, 56.25 % are in favor of a ban being imposed on advertising of tobacco & liquor. On the other hand 43.75 % of the audience from the general target audience says that no ban is required on the advertising of liquor & tobacco.

ConclusionAs much as 64% of the sample is in favor of a ban being imposed on tobacco & liquor advertising, as against a 36% who feel that no ban on tobacco & liquor advertising is required. This clearly shows that a majority of people feel that the ever rising consumption & ills of consuming tobacco & liquor can be controlled by putting a ban on advertising tobacco & liquor. This reflects that the majority is in favor of the ban introduced by the government on liquor & tobacco advertising.

Q.2 Do you think the government has been successful in controlling the consumption of tobacco & liquor by imposing a ban on Tobacco & Liquor advertising?
Number of Respondents (%) 80 70 60 50 40 30 20 10 0 Advertising General Segment Overall 36 30 35 Yes No 70 64

65

Advertising Segment-

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In the opinion of as many as 70% of the sample from advertising segment, the government has not been successful in its attempt to control the consumption of tobacco & liquor by putting a ban on their advertising. Only 30 % of them consider that government has been successful in this endeavor of their. Other- While 36.25% of the sample feels that government has curbed the consumption of tobacco & liquor by imposing a ban on their advertising, a larger part of the sample .i.e.63.75% feels the ban has not helped the government achieve its objective

ConclusionAs against 35% of the sample who have voted in favor of the government measure, 65% of the sample considers that the government has failed in its endeavor to control the consumption of tobacco & liquor by imposing a ban on its advertising. Since the liquor & tobacco manufacturers have found alternate means of promoting their products, the ban has not been successful putting restriction to the ever increasing demand of liquor & tobacco. The response to the above question shows the opinion of the masses & highlights the inability of the government to achieve its objective of curbing the consumption of the tobacco & liquor.

Q.3 Which one of the following do you consume? In order to be able to analyze the feedback of the people constituting the sample it was important to know there preference for tobacco & liquor.

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80 Consumption Pattern of Respondents (%) 70 60 50 40 30 20 10 0 Advertising 10 10

75 63.75 52 Tobacco & Liquor Tobacco Only Liquor Only 22.5 11.25 5 2.5 General Segment 4 Overall 20 24 None

Advertising SegmentOut of the twenty people belonging from the advertising background 10% of them consumed both tobacco & liquor, 10% consumed only tobacco, those who consumed liquor only constituted for 5% of the sample. However majority of them .i.e. 75% of them said they consumed none of the two. OthersIn case of the general sample or the sample constituting of general public 22.5% people said they consume both tobacco & liquor, 2.5% consumed only tobacco, 11.25% of them consumed none. But 63.75% agreed on their being consumers of liquor alone. ConclusionOut of the total sample size of 100, 20% consume both tobacco & liquor, 4% consume only tobacco, 52% consume only liquor and 24% dose not consume any of the two. The result shows majority of the sample being consumers of tobacco &/or liquor, this implies that the data collected from this sample provides a realistic base for analysis.

Q.4 What comes to your mind when you see advertisements like Red & White Bravery Awards, Royal Challenge Golf & club Accessories, Bagpiper Soda, Aristocrat Apple Juice, Manikchand Filmfare Awards?

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140 120 Openion of Respondents (%) 100 80 60 40 60 20 0 Advertis ing General Segm ent Overall 42.5 46 Rem inds of Core Product 30 5 5 46.25 17.5 22.5 20 19 38 Associate to Product in the Ad Encourages Increased consumption Encourages to Consum e

Advertising SegmentA strong 60% of the target segment says the surrogate advertisement reminds them of the core product that is the liquor or tobacco. 5% percent of the people in the sample feel that the surrogate advertising encourages them to consume liquor or tobacco. Another 5% of them feel that surrogate advertising makes them feel like consuming more of the liquor or tobacco. However 30% of the target segment in the sample feel that for them surrogate advertisement are advertisement of only the product being shown there in & not of the brand or core product. OthersIn the general target segment, 42.5% of the people feel that the surrogate advertisements remind them of the core products i.e. liquor or tobacco. 46.25% of the people from whom the data was collected said the surrogate ads encourage them to consume liquor & tobacco. While 22.5% of those who were part of the sample feel that surrogate advertising induced in them the desire to increase the consumption of liquor & tobacco, 17.5% say that for them surrogate advertising is just another which, tries to market the product being advertised.

Conclusion-

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The very reason for which the liquor & tobacco manufacturers took to surrogate advertising was that in the presence of the ban, they needed to promote there product & maintain a strong brand recall. All this was obviously for the very basic cause, that is maximize sales volume & to have a bigger customer base. Based on the response to this question it can be said that surrogate advertising does its job well because 46% of the respondents correlate to the core product, whose brand is being advertised, 38% of them are encouraged to consume tobacco & liquor. As per 19% of the people in the sample, surrogate advertisements also create desire in the viewers to increase their consumption of tobacco & liquor. Only 20% of the people feel that for them surrogate ads are just an ad of the product being promoted in the advertisement & not of the core product or brand.

Q.5 Are you aware of the phenomenon of Surrogate Advertising (as mentioned above)
160 Percentage of Respondents (%) 140 120 100 80 60 40 20 0 Advertising, 75 Overall, 8 General, 8.75 Advertising, 5 Advertising, 20
Advertising

Overall, 35 General, 25

Overall, 57

Overall

General, 66.25

General

Familiar & Aware Not Familiar but Not Familiar & Not of Concept Aware of Concept Aware of Concept Familiarity & Aware ne ss

Advertising SegmentIn the advertising segment of the sample 75% of the people said they were not just familiar with the term surrogate advertising but they also knew the concept. Only a small

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section, constituting 5% of the respondents from advertising and media target segment said even though the new the concept, they were not familiar with the term. 20% were unaware of both the term & concept of surrogate advertising. OthersAmong the general target segment the majority constituting of 66.25% said they were not aware of the term surrogate advertising & the concept. While 25% people said they were familiar with the term surrogate advertising & also knew the concept, 8.75% of people said although the new the concept but they did not know the term surrogate advertising. ConclusionIn order to understand the awareness & comfort level of the target segments, it was important to determine there knowledge about the topic of the study. The result shows that surrogate advertising is a less known fact to a layman & hence the surrogate adds would have a mixed impact on the audience, this means that while some would consciously realize of why surrogate advertising of core brand is being done, others might not be equally receptive to the message of the ad. The response to the above question highlights the lack of awareness in people about surrogate advertisement. Out of the total sample of 100, 57% said they were not aware of surrogate advertising as a term & concept. Out of the remaining 35% said that they were familiar with both the term & concept of surrogate advertising. Remaining 8% were only familiar with the term but not of the concept.

Q.6 What according to you is the root cause that led to surrogate advertising?

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Percentage of Respondents (%)

180 160 140 120 100 80 60 40 20 0 Loopholes in Ban on Advertising Advertising, 50 General, 57.5 Overall, 28 General, 20 Advertising, 20 General, 40 Advertising, 40
Advertising General

Overall, 56
Overall

Overall, 39

Pressure of Better Brand Incresed Recall due to Competition & Ban Surrogate Ad's

Root Cause of Surrogate Adv e rtising

Advertising SegmentMajority of the people from the advertising segment of the sample .i.e. 50% of the respondents feel that surrogate advertising has emerged from the loopholes existing in the laws directed towards implementing the ban. 20% of the respondents feel that surrogate advertising is an outcome of increased competition among the liquor & tobacco giants, which forced them to advertise in one form or another. In the opinion of 40% of the people from advertising segment, surrogate advertising exists because it leads to better brand recall & increased sales of the core product.

OthersWhile 57.5% of those belonging to the general segment, attributed the existence of loopholes in the law created to ban advertising of liquor & tobacco as the root cause that led to surrogate advertising, 20% respondents felt that surrogate advertising was an outcome of the increased competition among the liquor & tobacco giants & this is what forced them to take up advertising in one form or another. For 40% of the general segment who responded to the questionnaire surrogate advertising emerged because it leads to better brand recall & helps in increased sales of the core product.

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Adding to the findings of question 4 of the questionnaire

ConclusionOut of the total sample size of 100, in the opinion of 56% of the people the root cause of why surrogate advertising exists is that there are loopholes in the laws that were created to implement a ban on advertising of liquor & tobacco. Like any other industry the liquor & tobacco industry also has lots of players which, results in cut throat competition. This is the view point that 28% of the respondents share, as they feel the pressure to advertise in form or the other to compete in the market, is what has lead the liquor & tobacco giants to take up surrogate advertising as an alternative to the ban. Another 39% of the people said surrogate advertising exists because it leads to a better brand recall & leads to increased sales of the core product. The above response reveals the large success story of surrogate advertising. The results mentioned above in addition to the response to question 4 of the questionnaire out rightly shows that surrogate advertising results in a better brand recall & increased sales.

Q.7 Do you think Surrogate advertising is good for the core brand itself ?
53 Openion of Respondents (%) 52 51 50 49 48 47 46 Advertising General Se gm e nt Overall 50 50 49 48 Yes No

52 51

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Advertising SegmentSurrogate advertising, is it truly beneficial for the core brand itself or does it erode the essence & the brand image of the core brand? The feedback that was received from the Advertising segment of the sample indicated a mixed opinion. While 50% of them felt that the surrogate advertising is good for the core brand & does benefit it, the other 50% felt that surrogate advertising has a negative impact on the core brand.

OthersTalking of the general segment, 52% of the people are of the view that surrogate advertising does good to the core brand itself. On the contrary 48% feels that surrogate advertising does not contribute in a positive manner to the core brand. ConclusionTaking a look at the comprehensive picture there is very small difference between the number of people who feel surrogate advertising contributes positively to the core brand. While 51% of people are of the view that surrogate advertising is good for the core brand itself, 49% of those who responded to the questionnaire feel that the surrogate advertising is not good for the core brand itself. This reveals that surrogate advertising needs to planned & executed very carefully as it plays a critical factor in making or breaking of the brand image & exclusiveness of the brand. There is high risk that if surrogate advertising is not executed correctly, it might lead to adverse impact on the brand.

Q.8 Do you think that surrogate advertising leads to increase in consumption of liquor & tobacco?

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Openion of Respondents (%)

90 80 70 60 50 40 30 20 10 0 Advertising General Segment 30 70 57.5 42.5

80

Yes No 20

Overall

Advertising SegmentIn the opinion of 70% of those belonging to advertising segment, surrogate advertising leads to increase in the consumption of liquor & tobacco. 30% of people from the same segment are of the belief that surrogate advertising dose not lead to any increase in sales of liquor & tobacco.

OthersSurrogate advertising dose lead to increase in the sales of liquor & tobacco, this is the belief of 57.5% of the respondents from the general segment. However 42.5% of the respondents are of the view that surrogate advertising d ose not contribute to the increase in the sales of liquor & tobacco. ConclusionIn the overall context 80% of the respondents said that liquor & tobacco sales increased as an outcome of the surrogate advertising. Where as another 20% of those who responded to the questionnaire were of the view that surrogate advertising dose not result ssupport the belief that surrogate advertising results in increased consumption of liquor & tobacco, highlights the success of surrogate advertising in achieving the key motive, which is increasing the sale of the core brand being advertised in them.

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Key Findings of the Study  95% of the respondents in the Advertising segment emphasize that a ban on liquor & tobacco advertising is required. This is a surprising revelation from the horses mouth.  The success of the government in imposing the ban is evident from the fact that 65 % of the total respondents have firmly said No, when asked if the government was successful in imposing the ban on liquor & tobacco advertising.  As compared 52% of the respondent who consume only liquor, only 4% of the respondents consume tobacco alone. This shows that there is not truth in the fact that those who drink alcohol & also consume tobacco. This also supported by the fact that only 20% of the respondents consume both tobacco & liquor.  The effectiveness of the surrogate adds is eminent from the finding that 46% of respondents accept that it reminds them of the core product. Another 38% of respondents feel surrogate advertising encourages them to consume tobacco & liquor.  As many 57% of the respondents were not aware of both the term surrogate advertising & the concept. This shows that ignorance is bliss, though here it’s a bliss for the tobacco & liquor manufacturers

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FINDINGS

Should one lose the right to tipple or smoke? Certainly not. The wisdom of the Government extends only to banning the advertising of tobacco or liquor. Not to the manufacture or marketing of these supposedly deadly substances. It is legal to manufacture liquor and cigarettes or beedis. It is legal to sell cigarettes at every roadside stall, even to unsuspecting children. It is illegal to advertise it? And that is precisely why we have to live with surrogate advertising. We can remember the `Keep Walking' series of advertising. They were the result of a market reality where a manufacturer who has the right to sell his products does not have the right to advertise it. Who is anyone to decide whether one can sip his/her daily quota of what started off as eau de vie, or the water of life and then rapidly transformed itself into its present day avatar, Scotch? People have spent years perfecting a heavenly blend of spirits, and imparted to it the smoky flavor that could come only from the peat of Scotland and the pristine Highland water. Who has the right to decide if one should deeply inhale the rich aroma and full-bodied flavor of carefully rolled Virginia tobacco? Every time one nonchalantly put one of those sticks to his/her lips they feel to have mounted a wild mustang and riding down the lonely mountain trails of Colorado. But for a company like ITC, the ban may infact prove beneficial rather than detrimental. ITC’s brands are well entrenched in the market. Surrogate advertisements in most cases play a role of reinforcing brand recall rather than inducing consumption. If no body can advertise, than the threat of competition from new players or new launches by competitors is minimized. ITC with its wide brand portfolio consisting of the most wellknown brands in the country and the widest distribution reach among the cigarette companies is better placed than any other competitor in an atmosphere where no advertising is allowed. The ban therefore, if and when implemented, would not have any negative impact on ITC’s earnings in the near future. What could be a real concern is the growing strength of

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the anti-smoking lobby. Policy decisions in the pre-budget period indicate to a certain extent the Government’s stand on various issues. The announcement made this week could just be a precursor of what is likely to come in the Budget to be announced at the end of this month. An excise duty hike therefore could well be on the cards. 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 this and realising 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. Sociological studies have shown that, in India, a significant share of income of a large section of the population is spent on liquor, potentially leading to financial distress and health hazards. According to the International Wine and Spirit Board, a liquor industry publication, there will be a jump in the number of people reaching the legal drinking age of 25 within the next few years. The implication is that the problem is going to grow. 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. Understanding the gravity of the situation, the Indian Broadcasting Foundation (IBF) has started to take on the surrogate liquor advertisements. In a recent board meeting, the IBF decided that Jagatjit Industries and other liquor manufacturing units must get production of the advertisement approved both at the `storyboard stage' and after the production of the commercial. It also ruled that that if liquor companies promote any juice, mineral water or soda, these should be shown in a proper manner and not as trimmings to liquor advertisement. These are welcome steps, but the key point lies in enforcement. If, in a free society, producers have a legitimate right to let consumers know about their products through

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advertisements, consumers have the right to information in adverts that are clear and honest. Surrogate advertisements are not only misleading, but also false and dishonest in many cases. With surrogate advertising so widespread, this is the moment to tackle the problem head-on. Voluntary Organization in Interest of Consumer Education (VOICE), a Delhi-based non-profit, non-political consumer group conducted a study in October 2004. The study was based on the premise that the Cigarettes and other Tobacco Products (Prohibition of Advertisement and Regulation of) Trade and Commerce, Production, Supply and Distribution Act 2003 has raised the expectations of the citizens further on the role of the law enforcers. Among other features, the Act prohibits all forms of direct and indirect tobacco advertising; bans totally the sponsoring of any sport or cultural events by tobacco companies; prohibits smoking in public places; prohibits sale of tobacco products to persons under 18 years; prohibits sale of tobacco products within 100 yards of educational institutions; makes mandatory indication of nicotine and tar contents on the packets and presence of pictorial warnings on the packets in English as well as Indian languages. A look at some enlightening findings from the study: 92% of the law enforcers in Delhi strongly disagree with the statement that there is nothing wrong in smoking/consuming tobacco.  Only 70% of law enforcers in Delhi are aware of existing laws against smoking in India and of these only 58.8% are aware of the anti-smoking legislation of 2003. If the law enforcers themselves are not familiar with the laws then they are certainly not in a position to implement those laws adequately.  59% of the law enforcers in Delhi agreed with the statement that they do not want to take extra load by enforcing such 'minor laws' strictly. Instead, enforcing personnel believe they already have many other important laws to implement.  41% of the law enforcers in Delhi agreed with the statement that their involvement in tobacco related controls do not give them any benefit or recognition hinting that such enforcements have very little significance in terms of community and offence.

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SUGGESTIONS

There should be stringent regulatory measures to curb the practice, such as:  making transparent laws banning surrogate advertisements for different products under a single brand names, by amending the Trade Marks Act, for instance;  providing teeth to the Advertising Standards Council of India to enable it take action against false and misleading advertisements, and keep a close vigil over clever evasion of the law;  asking the electronic and print media to adhere to the advertisement codes and not encourage surrogate advertisements;  calling on the ASCI address complaints received from consumers against surrogate advertisements and take appropriate actions immediately;  creating a consumer awareness programme to help people understand the negative impact of surrogate advertisements;

adopting

strict laws to penalize those companies

featuring

surrogate

advertisements without any real existence of the product; and  requiring advertising agencies to have full knowledge of the products under the same brand for which they are promoting advertisements, and taking legal actions against those agencies which design surrogate advertisements.

Health warnings A single health warning (“Cigarette smoking is injurious to health” or “Drinking liquor is injurious to health”) is mandatory on packets and any advertisements.

MORE OF CSR Corporate along with the government can take up the following measures

Promote public education programmes on the harmful effects of the abuse of liquor;

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  

Promote social responsibility programmes; Promote the establishment of recreational facilities for youth; Promote the establishment and maintenance of support structures for the rehabilitation of individuals and communities affected by alcohol abuse; Promote further research on the nature and extent of the socio-economic effects of alcohol abuse; and Promote interaction between government and civil society, notably civic, youth and religious formations.

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BIBLIOGRAPHY
• • • •

Times of India Hindu business line Union health ministry Information & broadcasting ministry Saffer, Henry. The control of Tobacco Advertising and Promotion, Background paper.

• • •

http://www1.worldbank.org/tobacco/book/html/chapter4.htm http://www.who.int/features/2003/08/en/ http://scriptorium.lib.duke.edu/eaa/timeline.html • http://www.tobacco.org/resources/history/Tobacco_History21. html

http://surogate/EH_Net Encyclopedia Advertising Bans, US.html

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QUESTIONNAIRE
Note: To mark your response please tick in the check box given before each choice 1. Do you think we require any ban on Tobacco & Liquor advertising  Yes  No 2. Do you think the government has been successful in controlling the consumption of tobacco & liquor by imposing a ban on Tobacco & Liquor advertising  Yes  No 3. Which one of the following do you consume  Tobacco & Liquor  Tobacco Only  Liquor Only  None 4. What comes to your mind when you see advertisements like Red & White Bravery Awards, Royal Challenge Golf & club Accessories, Bagpiper Soda, Aristocrat Apple Juice, Manikchand Filmfare Awards  Reminds you of the core product i.e. liquor or tobacco  Encourages you to consume liquor or tobacco  Makes you want to consume more of their liquor or tobacco  You only consider it as an advertisement of the product being shown 5. Are you aware of the phenomenon of Surrogate Advertising (as mentioned above)  Yes, I am familiar with the term Surrogate Advertising & know the concept  I am not familiar with the term Surrogate Advertising, but I knew the concept  No, I was not aware of the term Surrogate Advertising & the concept

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6. What according to you is the root cause that led to surrogate advertising  Existing Loopholes in the laws directed towards implementing the ban  Due to increased competition the liquor & tobacco giants had to advertise in one form or another  Surrogate advertising results in a better brand recall & helps in increased sales of the core product. 7. Do you think Surrogate advertising is good for the core brand itself  Yes  No 8. Do you think that control on surrogate advertising leads to increase in consumption of liquor & tobacco? What in your opinion should be done to control the increase in consumption of liquor & tobacco, caused by surrogate advertising ………………………………………………………………………… ………………….. Personal Information Name: Designation:

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