Evaluating the Social, Ethical, and Economic Aspects of Advertising and Promotion

Role of Advertising in the Economy

Makes consumers aware of products and services Provides consumers with information to use to make purchase decisions

Encourages consumption, fosters economic growth

Economic Impact of Advertising

Effects on Consumer Choice Differentiation Brand Loyalty Effects on Competition Barriers to entry Economies of scale Effects on Product Costs and Prices Advertising as an expense that increases the cost of products Increased differentiation

Advertising and Promotion Viewpoints

Provides information (for) Proponent arguments Encourages higher standard of living

Promotes competition
Helps new firms enter a market Creates jobs
More propaganda (lies) than information

(against) Critic arguments

Creates unnecessary consumer needs and wants

Promotes materialism, insecurity, and greed

What is materialism?

Social and Cultural Consequences

Does advertising encourage materialism? Does advertising make people buy things they dont need? Is advertising just a reflection of society?

Advertising and Children

Children's TV Watching Behavior

Children ages 2-11 watch an average of 22 hours of TV per week and see 30,000 commercials per year

80% of all advertising targeted to children falls in four product categories: Toys, cereal, candy & fast food restaurants

Perspectives on Ads for Children

Advocates Argue That Children: Lack the knowledge and skills to evaluate advertising claims Cannot differentiate between programs and commercials

Marketers Argue Children: Must learn through socialization Must acquire skills needed to function in the marketplace

Advertising to children

Advertising and Stereotyping

Portrayal of women to reflect their changing role in society

Gender stereotyping

Criticisms of Advertising With Regard to Stereotyping

Portrayal of women as sex objects

Sexual orientation

Ethnic stereotyping/ representation

How women are portrayed in advertising

Ethics in Advertising and Promotion

Ethics: Moral principles and values that govern the actions and decisions of an individual or group.
A marketing or promotion action may be legal but not ethical Marketers must decide the appropriateness of their actions

Not all issues can be regulated

Advertising and Untruthful or Deceptive

General mistrust of advertising among consumers. Many do not perceive ads as honest or believable Abuses involving sales promotions such as contests, sweepstakes, premium offers Unethical and/or deceptive practices involving mail order, telemarketing and other forms of direct marketing Internet scams and abuses

Subliminal Advertising
Subliminal- To reveal a message without a person knowing or being aware

Subliminal Advertising

Subliminal Advertising

Subliminal Advertising

Do Advertisers Control the Media?

Advertising is the primary source of revenue for newspapers, magazines, television and radio Medias dependence on advertising for revenue makes them vulnerable to control by advertisers Advertisers may exert control over the media by biasing editorial content, limiting coverage of certain issues, or influencing program content

Do Advertisers Control the Media?

They must report the news fairly and accurately to retain public confidence Advertisers need the media more than the media need any one advertiser Media maintains separation between news and business departments The Wall

Advertising Can Address

Social Problems

U.S. Government Discourages Drug Use

Advertising Can Address Social Problems

Test Your Knowledge

Whether advertising :

A) Is insulting to women
B) Stereotypes women C) Affect childhood