Textbook Notes in syllabus order Ch 24 Economic Social and Legal Effects of Ads pg 727 749 o Advertising Criticism A Historical Perspective The Era of Exaggerated Claims 1865 1900 Advertising buyer beware Any claim for a product was allowed Ex magnetic machines sold as medicine The Era of Public Awareness 1900 1965 Public and gov t began to reject laissez faire economics see Pure Food and Drug Act 1906 FDA Companies realized that if they advertised the truth they could do a lot better The Era of Social Responsibility 1965 Present Public image became more important than just the truth The Role of Corporate Responsibility o Should companies pursue selfish routes to maximize profits to promote global welfare Or should companies pursue profits while keeping social issues in mind to promote global welfare corporations that try to be socially minded can cause harm to both their business and society Advertising is the focal point of debate when it comes to being socially conscious Advertising as an Economic and Social Institution The Economic Role of Advertising Primary economic role is advertising Ads provide consumers with information to make informed decisions Ads support largely unrestricted media Persuasion or information Advertising exists in both roles Economic Arguments in Favor of Advertising Mass ads permit companies to achieve economies of scale Ads contribute to increases in the overall economy by promoting generic brand consumption Economic Arguments Against Advertising o Ads encourage continuing product improvement Ads persuade instead of inform Ad money is wasted because they cause consumers to switch brands so there s no net economic gain Ads allow price hikes by making price seem far less important than quality High advertising expenditures make it difficult for new products to enter the market The Social Role of Advertising Two ways advertising affects culture Inadvertent repeated redundant messages presented by advertising sets a social agenda of what is expected due to the sheer weight of exposure Overt campaigns that intentionally attempt social change Some Social Criticisms of Advertising Privacy concerns Recently consumers have become fearful for the privacy due to the rise of communication technology The Do Not Call Registry makes it clear that both public and legislative bodies are taking intrusiveness seriously Product Placement Rose after public resistance to traditional marketing Advertising s Role in Obesity Fast food chains have been held liable for promoting unhealthy food to the public and particularly children Specific Areas of Social Criticism of Advertising Advertising content Critics claim that advertisements exaggerate products perpetuate oppressive methodologies inaccurately representing oppressed groups of people and just being unrealistic in general Advertising of certain product categories Distilled spirits as contrasted to beer and wine Critics claim that advertising hard liquor in public mediums like cable and radio could lead to severe underage drinking Condoms Most cable outlets ban condom promotion despite advocacy from health professionals out of fear of conservative media watchdogs and religious groups Advertising to Children Hotly debated due to market potential Excessive advertising Mostly directed toward TV internet advertising due to extremely high exposure Advertising s unwanted influences on society o Critics claim that persuasive marketing is counterproductive to consumer welfare interests Ads make consumers buy things they don t want or need This school of thinking has been debunked by communications scholars Advertising and Social Causes the Advertising Council The Ad Council is the most organized effort for social advocacy Big Brothers and Big Sisters Safety belts United Negro College Fund Forest Fire Prevention Environmental Defense Issue Advocacy advertising Homeland Security preparedness Mostly negative in order to derail opponents Advertising and Cause Related Marketing Cause related marketing For example AmEx promising to donate profits to the Statue of Liberty renovation Strategic Philanthropy Companies marketing good deeds the same as they would their product Categories of cause marketing Transactional programs based on individual purchases Message promotions where a brand promotes a good cause in its marketing Licensing programs when companies use charity logos in advertising Advertising Influence on Editorial Decisions Ways in which the relationship between advertisers and the media are changing Withholding advertising as an attempt to control editorial decisions When advertisers pull their ads if publishers run editorials that contradict the messages in said advertising Many companies require advance notice of contradicting editorials so they can pull their ads before the story goes to print Advertiser financed productions In which television outlets and advertisers jointly produce programming Very very bad without full disclosure Product placement Thriving in video games The Advertorial The use of advertising to promote an idea rather than a product or service Ch 1 Background of Today s Advertising o Forces in the Rise of Modern Advertising While advertising has been around since the dawn of time modern advertising didn t start until the mid 1800s in America Functions well with two main components Centralized exchange In which the advertising must make the consumer come to the producer An economy in which supply surpasses demand o In which advertisers must inform and persuade American public education provided need and support for magazines and newspapers and ergo advertising Civil War production allowed for the production of high speed printing presses Railroads and telegraphs further expanded markets The rise of national brands brought forth sophisticated marketing schemes as well as customer loyalty Quaker Oats Sears Gerber Advertising s Modern Era Research and Responsibility Most advertisements in the early 1900s were missing An ethical framework for promoting messages Valid and reliable research to measure advertising effects Early beliefs indicated that if an ad was ineffective it would be immediately apparent which is wrong Later on consumer protection rose in demand o False advertising led to legal drug addictions and public manipulation But honestly these ads weren t very manipulative as it turns out Quality ad research didn t come around until the 50 s Beginnings Advertisement like many things started in