Ethics In Advertising And Promotion

I was recently asked by the International Economic Development Council (IEDC) to author a handout for use in the upcoming Ethics Workshop scheduled for September 18th from 10:30 am – 12:30 pm during the 2011 Annual Conference in Charlotte, NC. Given the importance of the topic, and with approval from IEDC, I thought I would share the information with you and encourage you to attend the workshop if at all possible.

Ethics are the moral principles and values that govern the actions and decisions of an individual or group. They serve as guidelines on how to act rightly and justly when faced with moral dilemmas. In contrast, laws are society’s values and standards that are enforceable in the courts. But, there are numerous situations where judgment plays a large role in defining ethical boundaries. For perspective, actions that are technically legal could be considered unethical.

Pre-1960’s, caveat emptor (consumer beware) was the accepted ethical standard in the business world. But, that standard is no longer acceptable. In fact, it was forever changed when in 1962 President Kennedy introduced the Consumer Bill of Rights establishing six guidelines to protect consumers from unethical business practices. The right to be informed is particularly relevant for all advertising and promotion practices. This right states business should always provide consumers with sufficient information to make informed choices, and that the information provided should always be complete and truthful.

In that spirit, what follows is guidance, adapted from the ICC International Code of Advertising and Marketing Practice , to provide you additional perspective to the IEDC Code of Ethics as it relates to this specialized area. There is also additional information available in a previous blog post I authored on this subject.

Guidance

The overriding principle is that all marketing communication should be legal, decent, honest and truthful. It should be prepared with a sense of professional responsibility and conform to the principles of fair competition. No communication should be such as to impair customer confidence in the economic development profession.

  • Marketing communication should not contain statements or visuals that offend standards of decency.
  • Relevant factors likely to affect a customer’s decisions should be communicated in a way and time so they can be taken into account.
  • Marketing communication should not play on fear or exploit misfortune.
  • Marketing communication should not appear to condone unlawful behavior.
  • Marketing communication should be truthful and not by implication, omission, ambiguity or exaggeration mislead the customer
  • Marketing should not misuse research results or quotations of individuals.
  • Marketing claims made about a location should be capable of substantiation and that evidence should be available so it can be provided to any organization responsible for regulation of ethics of the profession.
  • When an advertisement appears in a medium containing news or editorial matter, it should be recognizable as an advertisement and the identity of the advertiser should be identifiable. Where appropriate, it should contain contact information to enable the customer to contact the advertiser.
  • Marketing communication that contains comparisons should comply with the principles of fair competition and be based on facts that can be substantiated and not unfairly selected.
  • Marketing communication should not denigrate any person, group of persons, organization or community.
  • Marketing should not contain any testimonial or endorsement unless it is genuine, verifiable and relevant.
  • Marketing communication should not imitate those of another marketer in any way likely to mislead or confuse the customer.
  • Those who collect data in connection with marketing communication activity should have a written privacy policy that is readily available to customers.
  • In any communication channel (including social media), if an opinion is put forward that could lead to an action that financially benefits the author (or employer), it should include a full disclosure statement.

How You Can Help

There are two ways to help keep the ethical standards for advertising and promotion high in our industry. First, if at all possible attend the IEDC Ethics Workshop at the 2011 Annual Conference in Charlotte, NC. It will provide you with a broad and practical understanding of how the IEDC Code of Ethics apply to your work. Second, leave a comment on this blog post with examples of challenging ethical calls you have either experienced or witnessed. It has been hard to come up with real world examples, and your help is greatly appreciated.

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11 Comments so far

  1. Robert Loggins

    July 7, 2011

    From my LinkedIn Comment:

    Ed, you pose a great question. I think there is inherent conflict that sales, marketing and advertisers face when trying to communicate their value proposition in a way that speaks to the needs of a target market. We are judged not on impressions, but on conversions leading to sales. Because of this we often enter an ethically gray area that is not clearly defined. While we are in the business of swaying emotions and creating perceptions, I try to funnel my advertising and promotional efforts through a systematic matrix (understanding, the logistical elements like who, what, why, who, etc.). Presenting the facts in a compelling manner–realizing that people like to buy from more than they to be sold to.

    As for examples that cross the line…the first thing I think of is beer commercials. All of the participants are young, beautiful and fit and they are having a great time. Not to say that drinking is wrong or bad, but unless they are poking fun they don’t use normal people.

    I’ve said enough for now, but great questions again.

    Robert –DDD Thinker

  2. Neil Arthur

    July 7, 2011

    Ed:

    Good thoughts here.

    You asked for examples and I have a long-standing issue with manipulation of media metrics in pursuit of ad dollars. The issue has been convoluted with changes in Arbitron and ABC rules and is now even more so with online page view and unique visitor counting.

    The medium documents traffic incredibly well but not the manipulation by skilled artisans making you click through multiple pages to get the ‘whole’ story and concurrently fulfilling ad contracts.

    Pushes limits of ethical behavior for me.

  3. It certainly shoudn’t be. I have always believed and acted upon the basis that if your product or brand are good enough to sell then you can sell them honestly, touting honest features and benefits that are enough to motivate a buyer. Creativity is one thing, being slick and slimy are quite another. It’s a shame people have to blur the line to think they can be successful. Honesty is the best policy and yes, even in sales. If you are up front and practice that, then your customers will be loyal and happy thus increasing your retention and repeat business. Pretty basic best practices that lend to longevity.

  4. Tim Mroz

    July 7, 2011

    I do agree that many cross the line too often. Too many ads are filled with base-less claims of being “the best” or even worse “one of the best.” By what standard, and by who?

    I do believe in the overriding principle you propose: that all marketing communication should be legal, decent, honest and truthful.

    I think a bigger problem our industry faces is that everyone is saying the same thing and not highlighting the unique qualities of their community and economy. Everyone talks about the same five things: great quality of life, great infrastructure, growing companies, tax incentive programs, and workforce.

    Flip through any industry pub and you can swap out the old-reliable map and location reference and have your own ad.

  5. Marco Monfils

    July 10, 2011

    How about Citibank’s “Live Rich” slogan, suggesting “safe” returns” (read poor returns) from a “safe” bank whilst engaging in the same risk taking as all the others, Lehman brothers, etc.

    Not only was the marketing slogan inaccurate, i believe it was grossly misleading, a great business model then- promise safe returns, swallow the profit difference

    As a Citibank customer, I’d like my risk taking returns back from the pre-crash era, after all it was my (and everyone’s else’s) cash they gambled with.

    My brother asked me, why do you believe this stuff? its just advertising (and he works in advertising..).

    No wonder marketing people are compared to snake oil salesmen.

    cut/paste from my LI

  6. Amber Skalla

    July 11, 2011

    I do the SEO at an e-commerce company that offers bulk nutritional supplements in pure powder or extract form. Our president is a physician and feels that ethics are important as far as us promoting since we sell “nutritional supplements”. For example, making claims that a certain product will give you certain results. It would be unethical to for us to say things like this unless certain it is true. Also, they are strict here on following FTC and FDA laws… Which, of course, from an SEO and marketing standpoint makes my life a bit harder.
    As far as social media, I think the “rules” are a little different. I look at it like you are offering an opinion and people can either accept it or not.

  7. Anthony diFrancesca

    July 14, 2011

    I worked in broadcast advertising compliance for 4 years and witnessed the issue of ethics in advertising. Children’s advertising is one area in which this issue exists. Most food advertised to children is not “good” or “health” food. Some of it may not be bad food, but you certainly do not see whole wheat pasta and broccoli being advertised to children because those foods are not “fun” and kids do not pay attention to things that are not fun. Advertisers take advantage of this by advertising the fun, unhealthy food. Although these commercials may be legally compliant, there does seem to be a lack of ethical integrity to such strategies. The same goes for weight loss advertising. There are many weight loss advertisers selling the latest and greatest gimmick. Advertisers know their gimmick will strike an emotional chord with a viewer that has been struggling to lose weight, even if that viewer has tried and not succeeded with the last three latest and greatest gimmicks. But the advertiser knows it has the viewer captivated by the potential that this time it just might work. Although there are often no legal issues with the advertising, the issue again is whether such strategy is ethical because of the apparent exploitation of the emotions involved.

    This discussion highlights the importance of the consumer needing to understand that advertising is not produced for their benefit. Rather, advertising is a commercial, financial endeavor, with the purpose of making money and, therefore, should be viewed skeptically. It is always up to the viewer to make the ultimate decision to purchase an item and the viewer always has the option to say “no.”

  8. Joel Saeks

    July 14, 2011

    I would agree with Janet and also take it further to many food commercials that say their foods are nutritious even though they are full of artificial substances, GMOs, or full of high fructose corn syrup. The fact that advertisers will pretty much work for whomever pays them leads me to question their ethics, in much the same way a Lawyer will work for a client they know committed a crime and try to get them off.

  9. Anthony Russo

    July 26, 2011

    From my LinkedIn Comment:

    Ethics can very much be upheld in both advertising and promotion, which are two distinctly different things in my opinion. Unfortunately it is not the norm it seems sometimes.

    I do a lot of promotion of my company’s EHS management software on the Groups and Q&A section of LinkedIn. Many people try to do this by just answering people’s questions with their sales pitch. This is a violation of ethics to me as it doesn’t help the person solve their problem…unless the question is “Whats a good product/service for this?” (which is rare).

    When someone poses a question and has a problem I try to answer the question with a solution or at least guide the poster in the right direction. If there is applicability for my company’s service, then I will mention it…always leaving disclosure that I represent the company.

    Sometimes I can answer the question but promotion of my company doesn’t fit well in the public forum, so I will send a private message to the poster asking them to contact me and discuss how my product can assist their problem.

    It is a fine line sometimes, but walked carefully, ethics can be preserved while still promoting yourself and services on LinkedIn and the Internet in general.

    Anthony
    Dakota Software

  10. [...] Ethics in Advertising and Promotion – I got frustrated with an emerging trend in economic development toward negative advertising. My experience in the private sector suggests this is a no-win spiral to the bottom and I wanted to do something to help curtail the practice. This led to a very productive conversation with IEDC leadership and a renewed emphasis on discussing the subject in the IEDC’s general course on ethics. If ethics are important to you, and you are interested in my take on the subject, this post is worth a read. [...]

  11. [...]   [...]

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