�Aspects Of Advertising

Presented By:-

Mrs.Savita Mahendru

Asst.Lecturer in Commerce

Hans Raj Mahila Maha Vidyalaya Jalandhar

​

�Aspects of Advertising – Social Aspect�

• The criticism that “most promotional messages are tasteless,” and that “promotion contributes nothing to society’s well-being” some­times ignores the fact that there is no commonly accepted set of stand­ards or priorities within our social framework. We live in a mixed economy, with differing needs, wants, and aspirations; what is taste­less to one group may be quite satisfactory for another.

• An adverti­sing strategy is concerned with an averaging problem that escapes many of its critics. The one generally accepted standard in a society like ours is freedom of choice for the consumer. Customer buying decisions will eventually determine what is an acceptable in the market.
• Advertising has become an important factor in the campaigns to achieve such societal-oriented objectives as the discontinuance of smoking, family planning, physical fitness, the elimination of abuse, prohibition of drinking, etc. Advertising performs an informative and educative task; and that is why it is extremely important practice in the functioning of modern Indian society

​

• A Social Perspective on Advertising:

Critics attribute an awesome ability to advertising to persuade millions of Indians to do almost anything. Advertising has been accused of causing, either directly or indirectly-

(а) An escalation in the national crime rate;

(b) An increase in communal riots;

(c) A decline in the respect for leadership of every kind

(d) The employment of strategies for the manipulation of children;

(e) The use of sub-threshold effects to slip messages past our conscious guard

(f) A deliberate sale of products for their status-enhancement value;

(g) Illogical irrational loyalties;

(h) The exploitation of our deepest sexual sensitivities and

(i) The application of the insights of depth selling to politics�

• There are, essentially, three challenges to advertising:

(a) First, advertising is challenged on the aesthetic front; the “bad taste” argument exemplifies this line of attack;

(b) Second, advertising is challenged on the moral front; the charges here range from exploitation of sex to those of “creating” wants �(c) Third, advertising is challenged on the economic front; its effect on prices, its influence on the rigour of competi­tion; in short, its effects on the allocation of scarce resources.

​

• It is difficult to define good taste; it would be impossible to legislate for it. Good taste is what you and I, and very few others, possess. Yet there are commercial uses of the mass media that are repugnant to the majority concept of good taste. The advertising industry should, to some extent, attempt to regulate itself to insure against such abuse.
• Each of the three components of the advertising industry sponsor (client), agency and media has established the means through which standards of taste may be controlled. Advertis­ing sponsors may be “regulated” by a company code of ethics as well as the industrial code developed by an association of firms. Note that these codes are self-imposed and entered into without compulsion or threat of penalties.
• Advertisements in India are becoming more and more exaggera­ted as products tend to level out in performance. To achieve competi­tive advantage, advertising magnifies unimportant differences, resorts to clever, tricky product promises and claims more and more unbeliev­able benefits.
• As a result, consumer belief in the honesty and since­rity of an advertising message and the value of that message in selling the product has been heavily discounted.

​

• Therefore a concern should have the following rules of adver­tising conduct:

(a) An advertisement should not claim or promise by implication any product performance or characteristic which is not fully supported by laboratory research, consumer research, or similar factual information;

(b) Advertising must not make use of the legal but dishonest device by which displayed promises are legally discounted in fine type;

(c) In TV commercials, visual demonstrations should be the real ones within the time limits of the commercial;

(d) Comparative claims for the products must be clearly suppor­ted by research, laboratory or consumer tests of the compe­titors’ products. Such tests should not be made against inferior brands, but against the best competitive products on the market.

​

• Advertising agencies in India therefore should not knowingly place an advertisement which contains:

(i) False or misleading statements or exaggerations, visual or verbal.

(ii) Testimonials which do not reflect the real choice of a com­petent witness.

(iii) Price claims which are misleading.

(iv) Claims which are insufficiently supported, or which distort the true meaning or practical application of statements made by a professional or scientific authority.

(v) Comparisons which unfairly disparage a competitive pro­duct or service.

(vi) Statements, suggestions or pictures offensive to public taste.

​

• There are areas in advertising which are subject to interpretations and judgement. Taste is subjective, and may even vary from time to time and individual to individual. The frequency of seeing or hearing advertising messages will necessarily vary greatly from person to person.
• However, an advertiser should discourage the use of advertis­ing which is in poor or questionable taste, or which is deliberately irritating in its content, presentation or excessive repetition.
• It is, of course, possible to argue that these codes and other efforts towards self-regulation within the advertising industry are ineffectual and are token reform measures, and that no real change has indeed been made.
• But the professional elements in the advertis­ing fraternity are sincere; they are, as they themselves admit, selfishly concerned, and fully aware of the likely consequences of grossly irresponsible commercial use of the mass media.
• As to the alleged moral transgressions of advertising, moral standards are set in a collective way. There is no single, well-defined moral code; there are many such codes. The moral range might run from outright prudishness to the “free everything” philosophy

​

• In one sense, advertising functions within the moral constraints imposed by society, and not within those that are imposed by the most prudish elements within that society. All of which does not mean that some objectionable movie advertisements should be condoned.
• But for those who believe that it is morally wrong that advertis­ing must persuade, that it is wrong for advertising to develop new “wants,” there is an even more emphatic answer. For many years, critics have distinguished between economic “wants” and economic “needs”. To satisfy an economic need has been viewed as a worthy cause; to satisfy a want has been considered as much less worthy.

​

• The fact that wants can be synthesized by advertising, catalyzed by salesmanship, and shaped by a discreet manipulation of the persuaders indicates that they are not very urgent.
• A man who is hungry need never be told of his need for food. If he is inspired by his appetite, he is immune to the influence of others. Others become effective only with those who are so far removed from physical want that they do not really know that they want. In this state alone, men are open to persuasion.
• The manipulation of wants becomes a moral question because it allegedly interferes with the process of free choice. It invades the inner sanctum of the mass mind and prevents clear thinking. But advertising is designed to predispose its readers to a favourable consi­deration of its sponsor and his product.

​

• It is deliberately planned to make its readers and listeners take sides to affiliate and ally themselves under its banner and to ignore all others. Advertising is not, and never was, a dispassionate, objective and unbiased dissemi­nation of truth. It has, in other words, a distinctive persuasive dimen­sion to it.
• And the line between a need and a want is not always clear. There is impressive evidence that even basic needs may not always be resolved without persuasion. In the early days, it was quite a job for Hindustan Lever to introduce Dalda (hydrogenated oil) as a cooking medium in South India.
• Dalda was an unacceptable answer to the basic need of a cooking medium till there was a bad crop of rice (shortage of rice), and people had to use whole wheat flour and to cook it, they needed a cooking medium, and therefore the sale of Dalda caught up.

​

• In short, the entire South Indian population had to be persuaded. But this is not the way man is supposed to act; we are told that only his wants require a persuasive sale effort. The allegedly evil, or moral, influence of an advertising-contrived want and what is a need are very much an individual matter. Indeed, a list of “needs” today would most surely contain an ample number of what must have been “wants’ yesterday.
• The concept of a need is necessa­rily flexible, defined largely by a particular environment at a particular time. The “wants” created by advertising result in what has been called a constructive discontent this constructive discontent repre­sents a very important aspect of human progress.
• While some excesses for example, the creation of frivolous obsolescence may be deplored, technological development is so rapid and the desire of the people for new things is so great that advertising has become a vital form of communication, and a vital tool which enables us to keep pace with continuous progress.

​

​

• Aspects of Advertising – Economical and Social Aspects
• Advertising has attracted attention for its impact on economic and socio-cultural environment of society. Advertising activity has vast employment potentials as it has number of jobs associated with it relating to creation, production, and delivery of advertisement.
• Advertising affects business cycles. In case advertising expenditure is planned judiciously during extreme time periods it could have stabilizing effects on economic conditions. When economy is weak the heavy expenditure on advertising would work as a stimulus for the economy as it gives a boost to the sluggish demand and also creates more revenue in the system. The large size of expenditure on political advertising during 2009 parliamentary elections is viewed as one of the significant factor in restricting the effects of global recessions on Indian economy.
• Market economies need advertising to affect the level of competition, price and demand for various products. Advertising may cause market expansion. But there are certain market situations where advertising actually restricts the competition in the market and gives rise to the possibility of charging higher price for the product.

​

• Those who are practitioners in the field of advertising support advertising on the basis that it only reflects and not shapes the values of society in which they live. These values are the result of socialisation and acculturation process. Advertising is only one of the environments which has its vast presence and with which the customer has an interaction.
• These issues are largely the ethical concerns of advertising effects and therefore advertisers are expected to keep restrain either in the use of advertising or in the adoption of certain advertising practices. In some cases, the use of advertising in any form is considered unlawful such as when consumers are induced to buy products like cigarettes which are considered as potentially health hazard products or when the intention is to mislead the consumer.
• Also, there are restrictions on the way legal and medical services are advertised. There are certain advertising practices which are considered unlawful. Consumer Protection Act, 1986, considers certain advertising practises as unfair trade practices and provides for certain legal measures to cover up against the loss to the consumer and to the society in case of the use of unlawful advertising practices. These measures are both corrective and punitive in nature.

�

���Aspects of Advertising – Economic Importance�

​

​

The problem is essentially that of:

(a) Learning to measure both the micro and macro-effects of advertising, so that it may be employed most efficiently from the viewpoint of both the firm and of society ; and

(b) Imposing social controls that will eliminate or minimize the deleterious effects of advertising on social welfare.

Economic Importance:

• If for no other reason than that it is an activity that employs several million people, promotion is of considerable economic impor­tance. More important, however, is the fact that effective promotion has allowed society to derive benefits not otherwise available.
• For example, the criticism that “promotion costs too much” views an individual expense item in isolation. It fails to consider the possible effect of promotion on other categories of expenditure.

​

Advertising As a Source of Information:

• Advertising strategies that increase the number of units sold permit economies in the production process. The production costs assigned to each unit of output are lowered. Lower consumer prices then allow these products to become available to more people.
• Similarly, the price of newspapers, amateur and professional sports, radio and television programmes, and the like, might be prohibitive without advertising to shoulder the expense. In short, promotion pays for many of the enjoyable entertainment and educational aspects of contemporary life and it lowers product costs as well.
• what extent does advertising provide information to consu­mers about the availability of products relevant to the meeting of consumer needs, and the price and terms of sale?
• First, the advertiser is the seller of the product or service. He has, therefore, more information about the product or service than anyone else. Whether the seller’s knowledge of his product is actually used expensively in the design of advertising programmes would have to be established by a careful study of the procedures employed in planning advertising copy

​

• If advertising agencies, for example, are found to be the ones that select from the cluster of product charac­teristics those that are to be stressed in a particular promotional pro­gramme, it would suggest that the seller’s intimate knowledge of his product is less important in determining what information gets to the consumer than other aspects of that choice, such as the probable impact of a given piece of information, consumer response in the light of product’s historical image, and the competitor’s policies.
• On the other hand, much advertising is highly informative. This is particularly true of want ads of manufacturer’s advertising that inform potential buyers of the availability of products and of their attributes, and of the retailer’s advertising of product availability, characteristics and prices.
• Wholesalers use less advertising than manufacturers or retailers, but where it is employed, as in the marketing of industrial supplies it is likely to contain considerable information, or is restricted to information about the availability of goods.
• Much of the information conveyed in advertising is accurate, and this is most likely to occur when the potential buyer is well informed and where the information itself is of a nature that is likely to be conducive to purchase.

​

• Such distortions may be will full, mischievous, accidental or unintended, but their effect can be the same, regardless of motivation. One important question, therefore, is whether advertising is a source of accurate and complete information about goods and services for the potential buyers of those goods and services.
• We must conclude that not all information conveyed by advertising is likely to be accurate or complete, for the very simple reason that criteria by which the advertiser judges advertising effecti­veness are not the same as those by which the potential buyer judges its desirability.
• Only if the means by which those criteria arc realized overlap for buyer and seller docs advertising fulfil the needs of both the parties. Thus, the critical factor is the possible conflict between the advertiser’s objectives and those of the buyer.
• This brings us to the final point. Granted that advertising may be informative in varying degrees, is this the best source of informa­tion for consumers? If we sort out from lakhs of rupees that we spend in India on advertising in a year that portion which may properly be labelled “informational” the question becomes- Is this the most effective way of spending that, much on buyer information ?

�

(ii) Advertising and Prices:

• Does heavy advertising expenditure raise consumer prices? The question is, superficially, a compelling one. The answer is that, in some cases, it does; in other cases it does not. The “logic” behind this answer is simple. It involves what may be called the stacking- up concept of costs. The view is often held that all elements of production costs and marketing costs must be summed up and covered (or recovered) in the final selling price. All these costs accumulate in this vertical or “stacking up” sense, and we end up by paying for each layer of the stack, as it were. The cost of advertising is seen as simply another clement in the stack, and its elimination is viewed as tantamount to price relief for us all.
• We should note that this argument need not be applied only to the individual advertise­ment or the advertising campaign, but to any promotional effort- trading stamps, etc., included. But in spite of the seeming simplicity and clarity of the logic of this criticism, a categorical statement that advertising raises consumer prices is wrong.
• Advertising may result in higher prices if it is ineffective, or if it does not result in an increased sales volume, even though market saturation has not yet developed. We have three instances in which advertising may increase consumer prices. [The critic who claims that advertising raises consumer prices presumes a constant (or increasing) unit costs of manufacture.

​

• These three instances are:

(a) When Market Saturation Exists:

When no amount of encouragement will entice new buyers to try a particular product or service that is, when market saturation occurs -then a battle between competing firms with a not-to-be outspent attitude clearly represents an economic waste. This stand-off situation may result in losses to the battling firms or in higher prices to the final consumers.

(b) When Decreasing Returns to Scale Are Encountered:

In this instance, advertising may increase the -sales volume, but it may not produce a lower unit cost of manufacture. When the costs of manu­facture increase with increases in the sales volume (called decreasing returns to scale), further advertising expenditure must accumulate in the vertical sense.

​

(c) When the Advertising itself Is Ineffective:

Finally, advertising may result in higher prices if it is simply ineffective, if it does not result in an increased sales volume, even though market saturation has not yet developed.

These are the three instances in which advertising can increase consumer prices ; but as long as a market is expandable (unsaturated), as long as lower manufacturing costs per unit are possible, and as long as the advertising produces (or helps to produce) an increased sales volume, it is possible to lower total unit costs. It is possible then to achieve lower consumer prices.

​

Advertising and the Level of Output:

• One of the arguments often presented in favour of advertising is that it stimulates demand, and therefore production, which, in turn, stimulates income generation. This suggests that there is a multiplier effect from advertising, and that this may follow logically from the perception of advertising as a capital expenditure.
• Another defense of advertising is that it is one of the competitive tools in an economy in which product differentiation and innovations are important attri­butes.
• It is particularly important, so it has been argued, as a means by which innovators may gain a foothold in the market. I would assume that the continuous growth of the gross national product is desirable.
• Because the rate of innovation is critical to economic growth, this marketing support also becomes critical in encouraging the manufacture of new products, product changes and growth.

​

�

Gross National Product & Innovation:

• I have already indicated that it is not possible to measure the effects of advertising with a high degree of accuracy for a particular firm, and this holds even more for advertising in the economy as a whole; that is, we do not know the extent to which advertising has served as a stimulus to demand in either the short run or the long run-the secular trend in advertising expenditures.
• Advertisers believe that advertising is a stimulus to sales of particular brands. Whether it has increased the demand for goods as a whole over a span of time is less clear, and will have to rema in a moot question until meaningful measurements can be evolved.
• To the extent that advertising is a part of the total economic climate within which the Gross National Product has grown secularly over the decades, and particularly a part of the dynamic elements of the climate, it may have had a role in the growth of national productivity.

​

(iii) Competition:�

​

• The nature of competition can be affected by advertising. While the demand creating potential of advertising may encourage new firms to enter an industry and existing firms to expand their product lines, one of the factors that appears to be associated with the successful use of advertising is the availability of funds for this purpose.
• Advertising appropriations make it possible for one t6 realize economies of scale in the use of such funds with a view to achieving lower unit costs and a greater potential impact on revenue and they also make it more difficult for new firms to enter the industry.
• Thus, the availability of funds for expensive advertising services does not stimulate innovations and sales promotion by many firms but rather restricts these possibili­ties for the larger firms in the industry which can support large promo­tional budgets.
• A greater concentration of production is more likely to result in rigidities in the market structure and behaviour. Such a market may not be without social benefits; but it lacks the vitality that characterizes competition in a larger number of smaller firms

​

�(iv) Advertising & Allocation of Resources:�

• One other question that should be answered in an overall appraisal of advertising is its impact on resource allocation. Let us assume that advertising can, in fact, increase the demand for specific products and specific brands in a product group.
• To the extent that this diverts consumer expenditure from other goods and services, the demand for which is less responsive to the persuasive effects of advertising, there is a reallocation of resources.
• If consumers experience the increased satisfactions that they anticipate as a result of this, welfare is enhanced by this allocation. To the extent, however, that consumers are disappointed with the consequences of their based on advertising, there is a resulting misallocation of resources and reduced total welfare.
• Some people deplore this aspect of advertising on the basis of value judgments. Specifically, they believe that the “things” that much of our advertising glorifies are undesirable because they are not what these individuals believe are “good” for human beings.

​

​

• Adver­tising expenditures have the profoundest potential effects, particularly when products have hidden qualities and when the wants that are satisfied by those products are of a high order, and are subjective. Some criticise advertising because it diverts more of our resources to fulfilling these wants than is desirable.
• They expand their criticism to include the fact that hidden qualities can be more easily falsified or exploited by effective advertising and that advertisers can and do take advantage of human ignorance and lack of experience in meeting these more marginal wants, which emerge to become important demand determinants only after more basic biological and socio psychological needs have been satisfied.
• Advertisers cannot make consumers behave in a specific way. They can persuade them, and their persuasive skills often exceed the consumers’ skill in self-protection. Consumer wants are part of human wants and are the products of the culture in which the individual evolves.

• They expand their criticism to include the fact that hidden qualities can be more easily falsified or exploited by effective advertising and that advertisers can and do take advantage of human ignorance and lack of experience in meeting these more marginal wants, which emerge to become important demand determinants only after more basic biological and socio psychological needs have been satisfied.
• Advertisers cannot make consumers behave in a specific way. They can persuade them, and their persuasive skills often exceed the consumers’ skill in self-protection. Consumer wants are part of human wants and are the products of the culture in which the individual evolves.
• The nature of culture and the process of cultural change are therefore more fundamental to an understanding of consu­mer demand than is any one element of that culture, such as adver­tising. Germane to the structuring of consumer demand is the whole process by which human beings learn to want most of the things that they desire and demand in the market.

​

• Advertising is one of the ways by which people learn, but it is by no means the only way, and is certainly not the most important way.
• Wants are not necessarily less valuable because they are acquired through emulation or advertising. Since most wants are learned, there is no logical basis for saying that one way of learning for example, through one’s, family or one’s formal education is superior to another for example, through advertising.

​

• We may conclude, then, that the creation of a want does not invalidate the assumption that arise in national income carries with it an increase in welfare, that if the evolution of wants is guided by the standards that society regards as reflecting improvement in the quality of wants, then want- creating activity, such as advertising, will evolve a rational set of guidelines that will direct demand toward goods that would satisfy wants most cheaply and profitably.

​

• It enhances buyer decision making by providing information and by supporting brand names. It provides an efficient means for firms to communicate with their customers. Such a function is particularly important in the intro­duction of new products.
• By generating various product associations, advertising can add to the benefit which a buyer derives from a product. It supports the various media and has the largely unrealized potential to reduce extremes in the levels of consumer buying.
• Advertising has become increasingly important to business enter­prises both large are small. The rise in outlays on advertising has been well documented and certainly attests to a management’s faith, in the ability of promotional efforts to produce additional sales.
• It would be difficult to conceive of a firm that did not attempt to promote its product in some manner or another. Most modern institutions simply cannot survive (other than in the very short-run) without promotion.
• Non-business enterprises have recognised the importance of this variable. The attempt by the armed services to increase enlistments is based on a substantial advertising campaign, stressing the advantages of a military career.

​

�Aspects of Advertising – Social Aspects: With Criticisms�

• It is argued that the biggest and potentially most insurmountable problem encountered in any attempt to examine and evaluate the social issues surrounding advertising stems from the essentially subjective nature of many of the criticisms that have been levelled in recent years.
• Although social and ethical criticisms of advertising are by no means new, the nature and seriousness of the complaints made has in recent years increased significantly. An additional problem is encountered in the form of the sheer volume of the criticisms that have been made. This trend has in turn been supported and reinforced by the attention paid by successive governments to the role of advertising and the rise of consumerism.
• Followings are the eight criticisms which in so far as are made most frequently and because they bear the direct relationship to the ethics of advertising are most pertinent to such discussion.

​

These criticisms are:

1. Advertising is frequently false and misleading.

2. Advertising concentrates on selling products to people they neither need nor want.

3. Advertising exhibits bad taste.

4. Advertising stresses small and insignificant differences between products and has resulted in an unnecessary and wasteful proliferation of brands.

5. Advertising is too persuasive.

6. Advertising can be used, to take advantage of children (bad effect on children).

7. Much advertising is irrelevant and unnecessary.

8. Advertising has resulted in uniformity

​

The charges labeled against the advertising can be explained in the following ways:

1. A manufacturer of cosmetics uses the appeal that the company’s cosmetic will make a young women more lovable and will attract young men to her. In her fantasy life, the young woman will probably want to be lovable and to attract a young man. And certainly she will be more attractive in real life if she is well groomed than if she is not.

We learn from advertising that a particular brand of carpet will make a living room more attractive or that this new lighting fixture will make a hall brighter. These, and many other similar statements, are true. They do not, however, say that they will accomplish the impossible.

2. People want to look better, eat better, live in better houses, drive better cars—in fact improve all aspects of their living. Merchandise that may entirely or partially satisfy the wants of the consumer may be sold more easily through persuading the prospect with the right appeal.

​

3. The charge is that advertising forces consumers to want merchandise that they cannot afford. But as we know that the advertising cannot move people in directions contrary to social trends and their preferences. One of the reasons why companies use marketing research is to find out how to advertise products and services to coincide with the demand of consumers.

4. The charge is that advertising lacks good taste? If the advertiser does not advertise the products and services that the Indian public openly buys, what other standards would be used to select the products. No doubt, some radio and television commercials are obtrusive and irritating. If the public is offended by the appeals used, the advertiser may soon find out their disapproval through a decrease in sales.

The first obligation of advertising is to communicate with the Indian public. Magazines, newspapers, television programmes and radio programmes are moulded to the public taste. Some people are more aesthetically oriented and more sensitive than the general run of advertising readers, listeners or viewers. If so, they may find some consumer advertising distasteful. That fact does not mean that the advertising now done is not gauged carefully to the level of most Indians. If it were not, it would indeed be wasteful.

1. Another charge is that advertising give undue stress on material things. It is obvious and it does stress. Does this mean that there has been a decline in the stress placed on people’s cultural and spiritual needs? Have people’s interest in intellectual and aesthetic pursuits declined because of advertising? Or are they less than they would be if we had no advertising.

2. Charge is that advertising lure people buy goods they do not need. It is certainly true that much of the advertising of today is designed to sell new products that are not necessities at present. However, many of the products called non-necessities today become what people consider necessities for a reasonable standard of living tomorrow, as was the case with the vacuum cleaner and the ceasefire. Much of the criticism that advertising sells people tilings they do not need is directed more at the fact that people buy things the critics does not think they should want.

Since advertising (so long as it does not violate standards of good taste, ethics; and so forth) is one form of free speech, it would appear reasonable that it be permitted and that consumers have the privilege of deciding what products they need and want, whether or not they happen to be what critics call necessities or luxuries.

​

�