Blog #7: Legal Issues of Advertising

The advertising industry operates within strict federal regulations which are monitored by the Federal Trade Commission. They regulate on many different levels here in the US. There are rules published on mail orders, the Internet, telephone sales, gaming, deceptions in advertising, product labeling, and so much more. Even with truth-in-advertising laws in place, advertisers still have an immense amount of leeway to violate the ethical standards of a wide range of consumers.

All of these types of advertising are pretty well known and the laws that go along with them are pretty obvious. Online advertising is becoming more and more popular as the years move along and technology advances. I want to focus on some of the not-so-obvious laws about online advertising out there including things like click fraud, keyword spamming, and false advertising.

Click Fraud:

Pay per click is a search engine’s simplest form of advertising. Each time someone searches a word and clicks the link to follow to your website, you agree to pay a certain amount to the search engine as compensation. (Click Fraud)

Click fraud comes into play when a competitor intentionally, repeatedly clicks on your ad and follows it to your website without any intention to buy anything. They do this to run up your bill without you getting any business as well as an attempt to cut into the company’s advertising budget. This is illegal; in fact, committing such a crime is considered a felony in many jurisdictions.

Proving click fraud is very difficult since it is hard to determine the culprit behind the computer and what their intentions are. One option relies on the search engine themselves. They can closely watch clicks to determine which ones are most likely fraudulent and not charge the account of the advertising. Another option is, the advertiser could register their website with pay-per click auditing services which would be an outside source closely watching your account to determine potential fraudsters. Of course such protection comes with a fee, though. (The Legal Issues of Advertising Online)

Keyword Spamming:

Spamming:Trademarks are a good way to gain consumers attention and get them to recognize your brand. It is important for a company to use their trademark in search engines so that people see your website first. A keyword spammer comes into play when an outside source tries using your trademark to veer consumers away from your business. They may do things like outbid you for your trademark or use it in invisible metatags. (The Legal Issues of Advertising Online)

To solve this issue, most of the time, a company has to take legal action directly against the spammer. In some rare cases, the search engine will just remove a keyword spammers listing if you complain.

False Advertising:

False advertising is a type of deceptive advertising. It is when someone uses false or misleading information or statements in advertising to maximize profits/consumer base. False advertising is illegal, and in most countries there is regulation to control false, deceptive or misleading advertising. It all comes down to the consumers’ right to know what they are buying and that their safety has been taken into consideration.  Although it is illegal, many still find ways to deceive consumers in ways that are not illegal. (False Advertising)

Below are a few different examples false advertising:

Undefined Terms: Uundefined terms comes into play when a terms meaning is not legally defined which leads to the words abuse in advertising. A perfect example of this was the word "light" foods. Usually this term meant low in calories, sugars, salt, carbs, or even light in color. Using the term light without legally defining what it means leads to a lot of confusion for consumers.

Hidden Fees and Surcharges: It is typlical for service providers to tack on additional fees and surcharges that are not included in the advertised price. An example of this could be when I went to buy a new phone last week. The phone I had decided to purchase was advertisied for $99 with a new 2-year agreement. I decided it was a good deal so moved along with the purchase. A few days later when I went to pay my bill, I was not only charged the $99 for the new phone, but also a $36 activation fee, and an additional $20 fee because it was a smart phone. These charges were not listed on the actual ad for the phone but apparently is listed in the phone company's new handbook.

“Going Out Of Business” Sales: Liquidators are hired to sell merchandise from stores that are closing down. The legal issue comes into play when the liquidators actually raise the prices on items that were previously marked-down on clearnace by the origional owner of the product. In reality, then, one could actually just go to the origional store in thier final days of operations and get items cheaper than if they were to buy from a liquidator.

References:

The Legal Issues of Advertising Online:
http://www.entrepreneur.com/article/160062


Click Fraud:
http://www.businessweek.com/magazine/content/06_40/b4003001.htm


False Advertising:
http://legal-dictionary.thefreedictionary.com/False+Advertising

Shockvertising: is the pain worth the price? Blog #6

Isabelle Caro, 27, is an anorexic weighing just 12lbs is displayed on

Milan billboards as the city celebrates its fashion week.

Shockvertising (aka shock advertising) is a controversial method of advertising aimed at purposely offending and/or startling consumers. The reasoning behind this?: to “gain attention, encourage cognitive processing, and have an immediate impact on behavior” (Dahl, 2003). There are many different ways that advertisers ‘shock’ their consumers. This includes things like profanity, using disgusting images, religious taboos, vulgarity, sexual references, violations to societal norms, and morally offensive content just to name a few. Shockvertising has been used around the world for many years but recently is being questioned as to whether or not it is a productive and ethical method of advertising.

Shockvertising has been deemed immoral by many, especially as the years pass because the advertisements are becoming more and more offensive. It is looked down upon because many believe that shocking the public is not a good way to get a brand, idea, or issue noticed. Although it has been looked down upon over the years, it has been proven to be an extremely effective way of gaining an audience’s attention.

Why do it?

The big question is: why do it? Yes, it is an effective way to gain attention, but there is also the chance that you could lose your audience because you are catching their attention in a way that offends them; it could give your products/ideas a bad image.

When it comes down to it, people are exposed to thousands of advertisements a day. These people don’t necessarily pay any mind to every single one, but they are definitely there. So how do you get your audience to actually notice your ad out of the 3000 they are exposed to in a day? You make your ad stand out in a way that will get them to notice it, which in most cases means exposing them to material that is not usually seen as social acceptable. The hard part comes when trying to find that fine line between what people find to be productive shocking and what some may just see as flat out offensive. (Offensive but Effective?)

A Few Examples

United Colors of Benetton:

Benetton first began their advertising with the goal of building up their personnel from all over the world. They did this by picturing young people from all different cultures dressed in their outrageously colorful clothing to show unity. Benetton emphasize the value of fellowship and cultural tolerance.

In later years, Benetton changed their advertising. They began presenting themselves with real world topics that went much wider than just black and white. They began using topics like war, AIDs, and pollution (just to name a few) as the focus of their advertising. They tried to make exciting emotions to the public by linking these topics to more real world subjects such as violence, death, sex and racism. The goal of this advertising is to increase the readers and the audiences to react in their ads.

Superette

In 2009 a New Zealand fashion outlet Superette wanted to make the point that if you are actually going to be caught dead in something, it would probably be better if you were wearing something truly stylish. They came up with the unique campaign “be caught dead in it” which pictured ‘dead’ models in stylish/up-to-date fashions who had met their violent death. Some of the ads are extremely gory and gained a lot of attention from the public. Superette’s ads are featured on billboards, newspapers, and fashion magazines everywhere.

Get Unhooked From Smoking

The UK Government’s national Department of Health started the “Get Unhooked” campaign in 2007. The photographs contained 4 different adults with fish hooks through their mouths showing their addiction to cigarettes, also providing a statistic about smoking and a phone number for help. “The ads psychologically make a lot of sense because they set up the trigger – the addiction of smoking – but then provide a solution: a phone number and website that will give details of NHS smoking cessation services” (Get Unhooked from Smoking in the UK). The ad draws people’s attention in by the disturbing image of a person with a hook stuck through their mouth. This was an extremely effective way of advertising.

Conclusion:

Shock ads will never fail to create controversy. Regardless of the intent or the issue at hand, there will be parts of society who will always find this tactic to be unacceptable and low.

Resources:
Shockvertising: A Poke In The Brain
http://www.aiga.org/shockvertising-a-poke-in-the-brain/


Shock Advertising http://en.wikipedia.org/wiki/Shock_advertising#.22Get_Unhooked.22_Anti-smoking_Ads

Get Unhooked from Smoking UK:http://theinspirationroom.com/daily/2007/get-unhooked-2/


Does it Pay to Shock?
http://data.adic.co.kr/lit/publication/tmp/A9001219/A9001219.pdf

Offensive but Effective?http://www.brandchannel.com/features_effect.asp?pf_id=84

Diversity in Advertising- Blog #5

This week, rather than talking about diversity in advertising as a broad subject, I decided I wanted to take a whole different look on diversity in the world of advertising. Everyone knows there is diversity in the world and that we need to change our advertising motives/plans based on what type of audience we have. There are all types of different diversity in advertising especially when it comes to people and their age, gender, race, religion, etc. but I want to look more specifically at one certain part of advertising and how diverse it is; this being diversity of colors in advertising.

Diversity of Colors Used in Advertising

I read an interesting case from my management book the other day and it really opened my eyes to a whole different part of diversity that I had never thought of before; the use of colors in advertising and how it is used in other countries. Advertisers have to be extremely careful when choosing colors for specific advertisements based on location and what the product is for. Every color has a psychological connection to some type of thought or feeling whether it is good or bad. A few examples: (Colors in Advertising)

·         Red: speed, power, excitement, stop

·         Green: health and nature

·         Blue: serenity, clarity, intellect, and precision, formality, elegance

·         Yellow: happy, energetic, rejuvenation, sunshine

·         Purple: luxury, high quality, feminine

·         Orange: adrenalin, cheapness, energy

·         Pink: feminine, baby, calming, sweet, angelic

·         Black: exclusive, excellence, formal, traditional

·         White: purity, calm, clear-cut

Deeper Analysis: Wendy’s Example

Wendy’s is a fast, well known food chain that seems to fit the idea of colors in marketing perfectly. Wendy’s markets its food and service with the very vibrant colors of yellow and red. The colors seem to pull consumers from what they are doing to come in and enjoy their food. The red seems to, in this case, stand for speed, excitement, and stop. The whole point of Wendy’s is “fast food”, when consumers see the red they think of fast service. Red has the ability to stimulate a person’s appetite as well, making it an excellent tool in the food industry. The use of red on Wendy’s signs gets hungry consumers excited and draws them to stop by and eat. Yellow on the other hand is another color used in Wendy’s marketing. Although it is not as prominent as the red in their color scheme, it still plays a key role in connecting with the consumers. The yellow suggests happiness. When you mix all the meanings together, the message you get is: stop here and eat, we will provide you with fast service and you will be greatly satisfied with your dining experience.  (Marketing and Color Theory)

Outside US Borders

The idea of color, emotion, and marketing seem to be the perfect combination. An issue arises, though, when the concept is taken outside of US borders. Different colors mean different things depending on where you are. For example “…yellow signifies happiness in the U.S., the color symbolizes sadness in Greece” (Kurtz, 2011, p. 166). This is where the question of whether or not global firms should change the colors of its logo or packaging depending on the country in which it is marketing. I am half and half on an answer for this question. I think that it should change depending on location because companies don’t want to lose consumers just because one of their main colors may represent a bad emotion or feeling. On the other hand, I don’t think that companies should change because the colors seem to signify the company worldwide. Take McDonalds for example; McDonalds is world famous for its golden arches. This is usually the first thing that pops into a person’s head when they hear the word McDonalds. By changing the color of the arches just because there is one located, for example, in Greece, we are stripping McDonalds of its image; what it is known for.

Conclusion:

Colors are very important in marketing because of all of the feelings they convey; it helps a company’s product sell itself in a way. Colors bring the idea of diversity to a whole new level and there are so many things that need to be considered when using them. The only issue that needs to be well-thought-out about this topic is one of which I already brought up earlier: global marketing and the use of colors. It is a tough subject but it is one that every global firm needs to take into consideration.

Resources:

·         Colors in Advertising:

http://library.thinkquest.org/08aug/01276/colorsanddesign/colorinadvertising.html

·         Marketing and Color Theory:

http://marketingcolor.blogspot.com/

·         Kurtz, D. L. (2011). Boone & Kurtz contemporary marketing (15th ed)