Ethics of Advertising

A business Ethics Presentation

By University of South Asia
What is advertising?
 Advertising is a form of
communication used to help sell
products and services. Typically it
communicates a message
including the name of the product
or service and how that product or
service could potentially benefit
the consumer
 HISTORY
 Edo period
advertising flyer
from 1806 for a
traditional medicine
called Kinseitan
 Egyptians used
papyrus to make
sales messages and
wall posters
Lost and found advertising on papyrus was
common in Ancient Greece and Ancient Rome.

As the towns and cities of the Middle Ages

began to grow, and the general populace was
unable to read, signs that today would say
cobbler, miller, tailor or blacksmith would use
an image associated with their trade such as a
boot, a suit, a hat, a diamond, a horse shoe or
even a bag of flour.
.In the 17th century advertisements started to
appear in weekly newspapers in England.

As the economy expanded during the 19th

century, advertising grew alongside
An 1895 advertisement for a weight
gain product.

In the early 1920s, the first radio stations were

established by radio equipment manufacturers
and retailers who offered programs in order to
sell more radios to consumers
A print advertisement for the 1913 issue of the
Encyclopædia Britannica
 Presently Organizations frequently
spend large sums of money on
advertising
Ethical Duties of Manufacturers

 Contract Theory
 Due Care Theory
 Social Costs Theory
 Contract Theory
 Firm’s duties to customer created by
contract with customer

1.Duty to comply: product must be safe for use

2.Duty of disclosure: disclose relevant facts
3.Duty not to misrepresent: don’t mislead
4.Duty not to coerce: don’t exploit fear, stress, gullibility,
immaturity, or ignorance
 Due Care Theory

 Seller has a duty to exercise due care to protect

consumers from harm
 Seller should protect consumers by:
 Design

 Choice of materials

 Manufacturing process

 Quality control

 Warnings, labels, & instructions

 Social Costs Theory
 Strict liability
 Seller should bear all the costs when
a consumer is injured by a product

Product price now reflects all costs,

including costs associated with consumer
injuries
Seller has incentive to protect
consumers
 Costs spread across all users of
the product
 Ethics and Culture
In history, some presidents evoke notions of truth
and honesty while some warn of the
consequences of lying. Abraham Lincoln earned
good name but Bill Clinton suffered
impeachment.

In the same way the world of advertising has its own

set of stories about the good and the bad, truth and
dishonesty. This unit focuses on truth and deception in
advertising and on the ethical dilemmas of those who
produce advertising
 What is Deceptive Advertising?

 Claiming that a product can do

something that it cannot is a
clear-cut case of deception.
 This is the picture by Nike
showing the strength of their foot
ball but in reality neither the
footballs are so huge nor so
powerful
 It is ethically wrong to show
something that doesn't exist
 Huge ADS And Advertisement
Balloons

Little children are usually amazed by certain ads because they

Are too young to understand the message in the advertisement
But they understands the picture.
Air balloons are seen from large distances and are not unethical
Only if certain type of bad pictures or bad language is on them
This kind of advertisement amaze people a lot specially the football
lovers
A wine bottle that is considered ethically wrong because the lorry may
have to move to certain places where drinking is unethical
OLDTIMER advertisement is rather funny and unethical because
Some people will have bad feelings about going inside a human body
MOVIE ADVERTISEMENTS

Movie advertisement outside cinemas are considered ethical

But bad pictures on them are considered strongly unethical
In a country like Pakistan
 Sports Advertising
 Sport goods companies
also advertise
themselves .For example
Olympics and football
matches etc
 Channel Advertisements
There is
advertisements of
programmes on
channels as well on
television
Advertisements on Internet
Advertising websites
 Mock-Ups, Demonstrations, and
Simulations in Ads

Mock ups are the props instead of the

real products in order to simulate the
way products work . ." For example,
shooting a commercial for ice cream
topping would normally occur in a studio
under hot lights. Under these
circumstances, real ice cream would melt
quickly so sometimes mashed potatoes or
shaving cream is used.
 EXAMPLE

 The Campbell's Soup ads of the late

1960s in order to show the
abundance of vegetables and noodles
in the soup, the ads were shot after
placing clear marbles in the bottoms
of the bowls and cups, helping the
vegetables stay near the top and
show up clearly in the ads. The public
complaint led to the discontinuation
of the practice and resulted in
considerable negative publicity for
the company
 Full Disclosure
 A class action lawsuit filed against the
McDonald's Corporation claimed,
among other things, that the
company's approach to advertising
highly processed food caused obesity
and other problems especially the
upsize deals, but court was not
convinced.In response to the negative
publicity generated by the case
McDonald's ads intended for children
currently focus on a healthy lifestyle by
showing Ronald McDonald engaged in
sports and outdoor play with children.
The current slogan is "It's what I eat
and what I do." Full disclosure is
perfect example of ETHICAL
BEHAVIOUR.
 False Advertising

 The claims in some ads are not

only often outrageous but
frequently completely false. For
example, the claims of the electric
belt ad shown below have no basis
in fact. Rather, they represent the
boastful proclamations of the
seller.
 EXAMPLE

In the picture it is easily

seen that the
advertisement of pizza
is different from what it
actually looks like
 Misleading Ads
The large grey area that exists between truth
and deception contains ads that people often
consider misleading. The ads are misleading
because they depart from literal truth and fact.
For example, if an ad for Brand X soap claims
"You can't buy a better deodorant soap than
Brand X or if a company says that all the
doctors world over recommend this soap like in
DETOL ads. Many advertisements made claims
like "4 out of 5 doctors surveyed recommend
Brand Y." This became widely known as a half-
truth because there was never any indication
of how many doctors had been consulted. A
picture of baby food ad is shown.
 Impression Management
 An area where advertisers and marketers
must decide what is permissible (and
therefore justified and ethical) is
impression management. In 1975, a
Delta Airlines advertisement showed a
flight leaving Newark, NJ at 7:15 am and
arriving in Atlanta, GA at 9:22 am, a total
of 2 hours and 7 minutes. In 2007,
Delta's online schedule shows a similar
flight leaving Newark at 7:15 am and
arriving in Atlanta at 9:38 am, a total of 2
hours and 23 minutes. Why the
difference? This creates a bad impression
and the company must focus on image
while doing such acts .Another example
is Maggi 2 minute noodles.
 Harmful Products
Should products that can have
harmful effects, like tobacco and
alcohol, be advertised at all? Many
advertising agencies respond in the
affirmative. They back up their
decision by saying that it is not an
agency's responsibility to decide
which products should be advertised
and which should not. Rather, their
reasoning goes: if it's legal to sell it,
it's okay to advertise it. Providing
kids cigarettes is unethical not only n
our society but all over the world
and is banned. Women smoking is
unethical in some countries
 There are other
agencies and a
handful of famous
advertising men and
women who refuse
tobacco or alcohol
accounts on ethical
grounds. They do not
want to be associated
with the social ills of
products that appear
to be as harmful as
these. Anti smoking
ads are also given to
discourage the
practice.
Community Standards
 Ethical standards in
advertising need to take
community standards
into account. A single set
of universal standards
about what is good, bad,
or just acceptable is
difficult to apply
everywhere. What may
be appreciated in one
community may be off
limits in another
Road Shows and free
sampling

 Some companies launch road shows

and free sampling for the publicity
Celebrities in ads
 Famous celebrities
are hired for
advertisements by
some companies and
by using the product
the customers feel
themselves like
those celebrities
Newspaper ads
 LOGOS FOR ADVERTISING
 Some well known
companies only use their
logos for advertising and
leave it to people to
understand
 Company special
offers

 Some companies give

special offers for
publicity.
Hidden Surcharges

 The most unethical

practice is the hidden
surcharges to deceive
the customers
Advertising Billboards & Flags
 Advertising to Children

Is it ethical to advertise to children?

Many People Believed that the Now-Abandoned Joe

Camel Character
Appealed to Children and Adolescents (1993)
Industry and Government
Regulation of Advertising

 Advertising agencies employ lawyers to advise them on

what can and what cannot be said in an ad. These
lawyers are specialists in the regulation of advertising
by government boards and the courts to keep in view
the general ethics related to advertisement
Fake advertising
Criticism on advertising is unethical
 CONCLUSION

 Advertising is not unethical if its

done in the right way
Thank you