Marketing and advertisement - Essay Example

Marketing and advertisement Marketing is the way companies interact with consumers to create a mutual relationship. Businesses market their products to identify their audience before advertising to them. From societal viewpoint, marketing is the link between a society’s material requirements and its economic patterns of response (PHILLIPS 1997, pg56). Generally, marketing is regarded as the science of choosing target markets via market analysis and market segmentation, in addition to understanding the buying behavior of the customers and hence greater customer value. One concept of marketing is advertisement; and this paper mainly focuses on advertisement as a marketing concept. Advertisement is a type of commercial mass communication developed to promote the sale of a product or service. It is a message on behalf of an institution, organization, or candidate for political office (PHILLIPS 1997, pg71). In this regard, I define advertisement as the paid, public, non-personal announcement of a persuasive message by a sponsor or promotion by business of its products to its existing and potential customers. Advertisement is a single component of marketing process and it is usually consists of using some aspect of the media to rely a message to the public (HORVATH, VILLAFRANCO & CALKINS 2009, pg56). Advertisement is a detailed process and hence quite a bit of thought and planning goes into advertising campaigns, as a complete campaign comprise of print ads, radio ads and television ads, all meant to maximize results for the client or business being advertisement. This paper tries to understand the various ways through which the UK CAP Codes (CAP/BCAP Codes) can be reformed. Advertisement can be seen in different perspectives. As defined above, the purpose of advertisement increase the number of articles or products sold. As if this is not enough, advertisement is also a very important aspect in the political scene as politicians use ads to sell their manifestos (DYER 1988, pg67). Advertisement developed into a big business in the 20th century, creating numerous jobs in advertisement agencies and the marketing industry. The growth in advertisement has been made possible through advance use of the media like newspapers, television, radio, magazines, direct mails and the internet. Advertising has developed to an international business strategy, since producers and companies try to sell their products on a globalized market in almost every corner of the world (DYER 1988, pg112). Business is all about who knows you rather than who you know. Advertising generates sales and opportunities through building awareness of products and services. Identifying of the ideal customer and understanding their motivation behind buying the products is core to the advertising production process. It is a fact that the process of advertising is a complex one and is therefore characterized by some costs (PAGELL & HALPERIN 1997, pg45). Therefore advertising agencies should avoid cost overrun by reviewing their adverts before incurring additional charges. Good advertising process should also ensure that the final product includes the necessary contact information, together with any needed mention of pricing or a special offer. In this regard, the entire advertising process requires a lot of responsibility. Knowledge of the laws is important to advertisement planning because of complexity of communication and the diverse perceptions of customers in response to promotional communications (DYER 1988, pg63). Media ethics is an elusive topic that will change from medium to medium from audience to audience and from person to person. Thus, I cannot write this paper from the perspective of right and wrong (MARLIN 2002, pg34) .Whenever a group of individuals are poses some power to influence the lives of others, ethical obligations becomes domineering. Ethical issues are imperative in considering different courses of action, and as a potential for targeting customers with “green” related products. I always believe that the mass media wield considerable power over the way society lives. As Rory Sutherland (President of the Institute of Practitioners in Advertising) states; “The truth is that marketing raises enormous ethical questions every day—at least it does if you’re doing it right. If this were not the case, the only possible explanations are either that you believe marketers are too ineffectual to make any difference, or you believe that marketing activities only affect people at the level of conscious argument. Neither of these possibilities appeals to me. I would rather be thought of as evil than useless” (MARLIN 2002, pg23). Hence the ultimate power that the mass media has forces and obliges them to work within ethical parameters. It is worth noting that ethical obligations in mass media communication are aimed at ensuring order in the media industry so that our lives become flourishing, worth living and successful (SHEEHAN 2004, pg21). Every advertisement is intended to persuade people to take some action hence much sensitivity revolves around the product, strategies and tactics used in persuading. Three specific moral principles of advertisement include: respect truthfulness, respect the dignity of human person and respect social responsibilities. It is worth noting that there are almost no national laws regarding advertising (SHEEHAN 2004, pg90). The advertising is therefore a self-regulated industry although FCC does regulated the media which advertising is communicated. Intentional dissemination of misinformation or false advertising is one among many of the areas that is punishable by law if found guilty. There have been increasing efforts to protect the public interest through regulation of the content and the influence of advertising. To illustrate this point, let state some known examples found in different countries such as: The ban on television tobacco advertising imposed in numerous countries. The total ban of advertising to children under 12 imposed by the Swedish government in 1991; which was later weakened by the European Court of Justice which stated that Sweden was obligated to accept foreign programming. In South Africa, Pakistan, Canada, Afghanistan and several European countries, the advertising industry is characterized by a system of self-regulation. Advertising stakeholders agree on a code of advertising standards that they attempt to uphold. This is necessary to ensure that advertising is legal, honest, truthful and decent. In the United States of America, several communities are of the idea that many forms of outdoor advertising blight the public realm. As early as 1960, in the US, there were several attempts to ban billboard advertising in the open countryside. In this regard, cities such as Sao Paulo have introduced the outright ban with London also implementing some laws to control unlawful displays. In the United Kingdom, there is also regulation in the advertising industry with the common being the regulation of the display of billboards as implemented by the UK town and County Planning system. CAP and BCAP Codes in the United Kingdom As mentioned in the instructions above, this paper focuses on the UK’s regulation in the media communication and specifically the advertising industry. In general, this paper tries to understand ways through which the UK CAP Codes (CAP/BCAP Codes) should be reformed. Before discussing the CAP and the BCAP codes, I find it necessary to discuss the body charged with the responsibility of ensuring responsible media in the UK as far as advertisement is concerned (COMMITTEE OF ADVERTISING PRACTICE (GREAT BRITAIN) 2010, 02). Advertisement Standards Authority (ASA) The Advertisement Standards Authority is the body responsible for the whole of the advertising industry in the United Kingdom. The Advertisement Standard Authority is a self-regulatory organization which means that the advertisement stakeholders enforce the rulings on themselves (GREAT BRITAIN 2010, pg122). It is a non-statutory organization and hence cannot interpret or enforce legislation. Nevertheless, the ASA’s code of advertising practice broadly reflects legislation in numerous instances. Its main function is to regulate the content of sales promotion, advertisements and direct marking in the United Kingdom. The body performs its function through investigating complaints made about advertisements, direct marketing or promotions and making a decision whether such advertisement complies with its advertising standards codes (COMMITTEE OF ADVERTISING PRACTICE (GREAT BRITAIN) 2010, pg13). These codes states that “before distributing or submitting a marketing communication for publication, marketers must hold documentary evidence to prove all claims, whether direct or implied, that are capable of objective substantiation” and that "no marketing communication should mislead, or be likely to mislead, by inaccuracy, ambiguity, exaggeration, omission or otherwise” (GREAT BRITAIN 2010, pg41). BCAP and CAP are both integral part of advertising standards. The Broadcasting Committee of Advertising Practice (BCAP) and the Committee of Advertising Practice (CAP) codes are the codes that these two organizations have for their area. The Broadcasting Committee of Advertising Practice mainly concerns with anyone showing and broadcasting the adverts while the Committee of Advertising Practice is mainly concerned with the people making the adverts and distributing them. The BCAP Code: The UK code of Broadcast Advertising The BCAP code was first introduced in September 2010. It was a replacement of the four previous separate BCAP codes for broadcast advertising BROADCAST COMMITTEE OF ADVERTISING PRACTICE 2010, pg5) The BCAP code’s main purpose is to inform advertisers and broadcasters of the standards expected in the content and scheduling of broadcast advertisement and to protect consumers. For this reason, this code is applicable to all advertisements and program sponsorship credits on radio and television services licensed by Ofcom (TWIGG-FLESNER 2007, pg134). According to the BCAP code; broadcasters are those television and radio services licensed by Ofcom to broadcast within UK jurisdiction regardless of the location of their main audience. On the other side, the code defines advertisement as “publicity by advertisers, including spot advertisements and broadcaster promotions of advertisers”. That is, broadcasts that are made with an aim of receiving payment as returns or other valuable consideration to a broadcaster (NÚÑEZ FERRER 2007, pg12). For serious or several breaches of BCAP code, Ofcom may impose sanctions. These sanctions range from a formal warning to a request for broadcast correction or a statement of findings, a fine or to the greater lengths suspension or taking away of a license to broadcast. It is inevitable to protect young viewers and listeners and Section 5 of the code is important in handling this issue BROADCAST COMMITTEE OF ADVERTISING PRACTICE 2010, pg96). Necessarily sections of the BCAP code start by stating the overarching principles and background information that inform the rules subsequently given and definitions of the key employed. However, some rules as stipulated in the Code’s section relates to categories of products or services. These sections are further divided into “rules for all advertisements” and “and rules for advertisements” (BROADCAST COMMITTEE OF ADVERTISING PRACTICE 2010, pg111) CAP code The CAP code is basically concerned with the content of marketing communications and not with terms of products themselves. The Committee of Advertising Practices (CAP) is the self-regulatory body that creates, revises and enforces the code. Its members comprises of organizations that present the advertising, sales promotion, direct marketing and media businesses. CAP code is very important in the advertising industry because it supplements the law and fills gaps where the law does not reach and hence providing an easier way of resolving disputes rather than civil litigation. Just like the BCAP code, the ASA is also the body that endorses and administers the CAP code hence ensuring that the self-regulatory systems work in the public interest (COMMITTEE OF ADVERTISING PRACTICE (GREAT BRITAIN) 2010, pg132). Majority of advertisers, direct marketers and promoters comply with the Code. Failure to comply may result to sanctions. This could range from pre-vetting and to some extent those who do not comply might be referred to the Office of Fair Trading for action. The CAP code is applicable to; advertisements in newspapers, brochures, circulars, leaflets, e-mails, mailings, fax transmissions, catalogues and other electronic or printed material; cinema, video, and Blu-ray advertisements; posters and other promotional media in public places; advertisements in non-broadcast electronic media; sales promotion in non-broadcast media; marketing database containing consumer’s personal information; advertorials and advertisements and other marketing communications by or from companies, organizations or sole traders on their own websites (COMMITTEE OF ADVERTISING PRACTICE (GREAT BRITAIN) 2010, pg71). Some of the notable areas that the code does not apply to include; broadcast advertisements, the contents of premium-rate services, marketing communication in foreign media, classified private advertisements, works of art exhibited in public or private and much more. The CAP is recognized by the Government, Office of Fair Trading and the Courts as one of the “established means” of consumer protection in non-broadcast marketing communications. However, as much as this code help regulates the media industry, it is important that any matter that concerns a legal dispute should normally be resolved through law enforcement agencies or the Courts (COMMITTEE OF ADVERTISING PRACTICE (GREAT BRITAIN) 2010, pg152). Reforms Advertising plays a crucial role in creating competitive, efficient markets that encourage innovation and benefit consumers and hence it should be legal, decent, honest and truthful action. For this reason, any reforms aimed at achieving this objective should be encouraged. However, the proposed reforms should not undermine the self-regulatory that is currently in place and enforced by the ASA (GREAT BRITAIN 2010, pg32). The year 2009 witnessed harmonization and a well coordinated review of the UK’s non-broadcast and broadcast advertising codes by CAP and BCAP respectively. However, the review was undertaken in consultation of various advertising stakeholders to ensure that the revised Codes are relevant to the modern market are fir for purpose. BCAP and CAP liaised with the advertising and policy makers as part of their review of the Codes in order so that the amended versions of the Codes covered all areas of concern and were as up to date as possible. In addition, the views of the general public were also important in undertaking the reforms. However, despite its importance, the UK codes should be reformed in the following way or section: Children: promotions containing a direct exhortation to buy a product must not be targeted at children; consumer protection; misleading claims-factual claims must always be substantiated and proper regard to the interests of the audience and society. The word “free” should be also defined in very informative way. Unsurprisingly, consumer protection featured on CAP/BCAP’s agenda in the recent review of Codes. In response, I argue that one of the advertising trends that CAP/BCAP out to address is the use of the term “free” when in the review/reform. That is, an advertisement should not describe of a package as “free” if that element included in the package price. In addition, it should be an offense to use the term “free trial” to describe a “satisfaction or money back” offer, “buy one get one free” offers, or an offer for which a non-refundable purchase is a necessity. Another area of concern is the rising cases of which advertising agencies mislead the public on the environmental benefits of a product. The Codes should address this issue amicably and an express rule that prevents advertisers from making unsubstantial claims about the environmental impact of products. Committee of Advertising Practice should make amendments to each of the sections 14 (Financial products, services and investments) in the BCAP and CAP code to reflect the recent changes in the UK regulatory structure and changes in the legislation governing the advertising and marketing of financial services products. These changes should focus in updating the BCAP and CAP (CAP: section 14). For instance, in regards to the dissolution of the Financial Services Authority and its replacement with the Financial Conduct Authority, the codes should be designed in a way that they allow for upgrade. A good illustration of this point is section 14.11 of BCAP which is now know as Consumer Credit (Advertisements) Regulations 2010 as opposed to the then Consumer Credit (Advertisement) Regulations 2004 (BCAP: sec 14.11). The changes to the codes are aimed at updating each of the Codes and are therefore necessary for the eventual shift in the regulation of consumer credit from the Office of Fair Trading to the FCA in early 2014 (BROADCAST COMMITTEE OF ADVERTISING PRACTICE 2010, pg91). Considering the separate consultations between the ASA and advertising stakeholders, the CAP and BCAP regimes in the UK operate under separate, slightly different, codes and within different framework. These consultations are indications that UK advertising regulators are motivated to keep an appropriate balance between freedom of commercial speech and consumer protection (BROADCAST COMMITTEE OF ADVERTISING PRACTICE 2010, pg61). In my opinion this is good for keeping up with fast-moving legislation and engaging with key stakeholders. However, one note that worries me is in the CAP consultation is at section 5.1 (b), CAP seems to be taking the line that any information presented which is linked with an online sale must necessarily be a “marketing communication”. I argue that, logically, this is a flaw and can be traced right back to CAP’s initial guidance on the March 2011 CAP code online remit extension. This is opposed to offline position where packaging and point-of-sales displays fall outside the Code’s remit. What this means is that the whole categories of products that can lawfully be sold online and offline would not be sold safely and on online without breaching the CAP Code. Therefore, ASA needs to revisit the definition of “marketing communication” to address this issue so as to avoid any consequence that might relate to it (BROADCAST COMMITTEE OF ADVERTISING PRACTICE 2010, pg 51). The BCAP considered arguments for retaining the rule that in effect prevented marketers from comparing items were not similar but met the required need or purpose under comparative advertising law. The brand managers argued that if two products were similar in purpose but differed in their quality, then this comparative advertising would be not only misleading to the consumers but also unfair because significant differences in quality were likely to present in the advert. The old BCAP Code 3.39 states: Advertisements that include a price comparison must state the basis of the comparison. Comparisons with a competitor price must be with the price of an identical or substantially equivalent product and must explain significant differences between the products. If the competitor offers more than one similar product, marketers should compare their price with the price for the competitor’s product that is most similar to the advertised product (BCAP: section 3.39). The brand owners sought out for a more flexible rules that will allow for comparison between products or services that were identical or similar to ensure a comparative advert. This concern was taken into consideration by BCAP and a balance reform to BCAP Code 3.39 was made necessary because BCAP Codes 3.3-3.35 governed comparisons with indentified competitors in addition to the general rules that are meant to regulate against misleading advertisement. The new BCAP Code now states: Advertising that include a price comparison must make the basis of comparison clear (BCAP: section 3.39). The additional of the words ‘which may include price’ to the end of BCAP Code 3.35 was also important to reflect fully the legal requirements for comparative claims and underscore the principle integrated in EU law. The European Union Misleading and Comparative Advertising Directive 2006/114/EC demands that competition based on the price must be objective, representative and verifiable. This is viable way of making reforms in the UK BCAP and CAP codes In conclusion, I argue that the UK BCAP and CAP codes are important steps that ensure ethical and responsible advertising. Advertisement has become an integral part of the society hence its influence on the behavior of the society is not negotiable. The highlighted reforms above indicate that much needed to be undertaken to ensure proper legislation in the advertisement industry. however much that has been said the UK BCAP and CAP has done a great deal in ensuring proper conduct in the advertising sector and hence some reforms need to be undertaken. However, it should be noted that before making any changes to the current Codes there should be thorough consultations with the relevant and concerned stakeholders. References "The CAP Code: truthfulness rule". Archived from the original on 15 September 2008. Retrieved 2008-10-10. BROADCAST COMMITTEE OF ADVERTISING PRACTICE. (2010). 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