Advertising Ethics - An Oxymoron?

TABLE OF CONTENTS

SPECIMEN ABSTRACT

INTRODUCTION

CHAPTER ONE: Basic philosophical principles of business ethics
1.1 Introduction
1.2 Business Ethics
1.3 Utilitarianism
1.3.1 Act Utilitarianism
1.3.2 Rule Utilitarianism
1.4 Deontology

CHAPTER TWO: Ethical issues in advertising
2.1 Introduction
2.2 Definition and role of advertising
2.3 Basic ethical advertising issues
2.3.1 The legal aspects
2.3.2 The moral aspects

CHAPTER THREE: The impact of advertising on children
3.1 Introduction
3.2 Advertising to children
3.3 Basic ethical principles of advertising to children
3.4 Businesses that are advertising to children
3.5 Main media channels directed to children
3.5.1 Television advertising to children
3.5.2 Internet advertising
3.5.3 Mobile marketing
3.5.4 In-school marketing

Methodology

Results

Conclusion

References

Bibliography

Appendices:
Appendix A: Laczniak`s Framework for Analysing Marketing Instruments
Appendix B: Win-Win Szenario
Appendix C: Questionnaire about Advertising Ethics

SPECIMEN ABSTRACT

Abbildung in dieser Leseprobe nicht enthalten

ABSTRACT

Advertising as the most visible element of the marketing-mix is concerning its ethical dimension actually in the midst of controversary. The expression of “advertisng ethics” is nowadays a good example when being asked to name an oxymoron. This project therefore concentrates on ethics applied to the advertising profession

The ethical dimension of advertising and its impact on consumers in general as well as on children as a target group is the main focus of the study. The aim of the study will be reached through drawing attention to the two major philosophical theories applied to business as well as advertising, utilitarianism and deontology

In order to gain a fair understanding of the subject, advertising and its role in society are examined. Furthermore, the ethical issues in advertising are presented based on the so-called legal and moral discourse. Since the method of advertising to children actually raises a lot of controversial opinions, this part of the legal discourse is examined in more detail. Due to these controversies, a primary research has been executed, with the aim to collect three controversial opinions of institutions involved in the debate of ethics in advertising. The participants in this debate are industry, advertising agencies and the third point of view of a so-called opinion leader. The study closes with the discussion of research findings with reference to the literature review, followed by the overall conclusion

Introduction

Advertising is part of the marketing and a communication that informs, interprets and persuades consumers. Therefore it is logical to attract high levels of criticism concerning its practice and its impact on consumer behaviour

This study is going to concentrate on the ethical issues of advertising and the ethical theories applied to the advertising profession

Firstly the ethics applied to business will be examined, because it is important for organisations to consider the moral values of the society in the course of marketing profit. Consumers, being more sensitive to moral issues, are expecting organisations to act ethically. Advertising ethics as a terminology was characterised as an oxymoron. Yet companies do not have to compromise in being ethical or profitable, but the ideal situation would be to combine both elements. In this case two major philosophical trends of ethics by Mill and Kant will be examined

The study then moves to examine the fundamentals of advertising, the impact it has on consumer behaviour concerning the role of advertising in society. In order to achieve a fair understanding of the advertising profession each of the components of it´s definition is examined separately as well as the different roles advertising has to deal with. The social and economic role advertising has is therefore, concerning the ethical discussion the most controversial one regarding the social responsibility of advertising. To examine later on the basic ethical issues in advertising two discourses are made. First, the so called legal discourse with areas such as deception, puffery, demonstrations and mock-ups, endorsements and testimonials, coupon fraud, sweepstakes, contests, games and advertising to children. Main participants in this discourse are lawyers and regulators, who try to rule the assumption that advertising is worth-while from economic and social perspectives as well as, that marketers have the right to persuade

Second, the moral discourse is made with participants like philosophers and ethicists who try to make a distinction between “having a right” and “the right thing to do”

This study then moves on to one of the issues of the legal discourse - advertising to children. According to Kenway & Bullen (2001), the child market has grown into one of the most profitable markets, because of their high influence on adult spending as well as their own spending power. Children are actually, regarding the ethical question, the “hot spot” in this discussion. In order to examine the impact advertising has on children, basic ethical principles, main businesses involved in advertising to children as well as the main media used to reach children are discussed. Main businesses that are highly advertising to children actually, are toy companies and food companies. The focus in this part will be put on the food advertising to children sector. Later on, main media used in the advertising to children sector, such as television, internet, mobile and in-school marketing are examined

According to Stanbrook (2002) children are deemed to need more protection from the persuasively black art of the advertiser. Based on this statement and the fact that the child market is actually one of the most profitable markets, a primary research has been carried out. This primary research consisted of a combination of questionnaire and telephone interview. The author decided to direct the questions to three edges of involved institutions. First the company side who want to sell products to children, second the advertising side that transfers the marketing strategy into advertisements and third the side of an opinion leader who tries to restrict practices of the advertising profession. In the following part the results of the primary research will be discussed based on the findings of the literature review

CHAPTER ONE: Basic philosophical principles of business ethics

1.1 Introduction

The need for the creation of “business ethics“ was created by the growth of business ventures. It was argued that business dealings with the employees, customers and the general public should be conducted based on ethical standards (Kitson & Campbell, 1996). As businesses are part of a human community, they must care about ethics, because communities are held together by virtues. Thus, philosophers and ethicists have occasionally turned their attention to the ways in which business is conducted (Kitson & Campbell, 1996)

In the literature on business ethics, the tension that is evident between the proponents of business on the one hand and ethics on the other, seems to lie in the perception that there is inherent balance or trade-off between following ethical practices and making profits (Sargent, 1999). Business should take into account consumer values. There is the feeling by consumers that what an organisation says does not match up with what it does. It is necessary for a businesses survival, not just to make profit, but that it complies with legal regulations and also with societies moral values (Kitson & Campbell, 1996)

Due to the complexity of the subject attention will be drawn on two major ethical theories applied to business ethics in general, utilitarianism and deontology. In order to provide basic information about how ethical behaviour is being perceived, an insight of these two theories is given in the following part of the project

1.2 Business Ethics

White (1993) defined ethics as the branch of philosophy that explores the nature of moral virtue and evaluates human actions. Another definition is given by Parker (1998), who stated that ethics is the attempt to build a systematic set of normative prescriptions about human behaviour, codes to govern everyday morals and morality

Furthermore, Parker (1998) argues that if we stick with the notion that ethics is about producing prescriptions “golden rules“ - then we immediately notice what a variety of rules philosophers have already presented us with. Aristotle’s suggestions about the virtuous character, Kant’s “act as if your actions were a general rule“, the utilitarians insistence on calculating the happiness of the greater number. Regarding these brief definitions, it becomes clear that ethics are an important part of human behaviour and human interaction

In contrast businesses can be regarded as commercial enterprises which exist, in a capitalist society, in order to make a return on the capital invested in them. It needs, therefore, to make a profit on the bottom line if it is to survive as the kind of thing its creators intended it to be (Kitson & Campbell, 1996). Therefore, an organisations aim is to add value to its business, but the question remains whether this aim could or even should be achieved via ethical entrepreneurship

Many people argue that “business ethics“is an oxymoron, a contradiction in terms. However, looking at the arguments of Agryris (1997) it becomes clear hat there is a strong relation between human beings on the one hand and businesses on the other hand. Organisations reflect the individuals that belong to them and individuals reflect the organisations they belong to, even though organisations cannot grow in the same way as they do, because the inner biological drive that individuals possess (Agryris, 1997). People actually working in business know that business ethics is a serious issue. Sargent (1997) mentioned that there is a call for business ethics to play a central role in raising the consciousness and awareness of business practices to human values. Even research shows that companies that emphasise values beyond the bottom line were more profitable in the long run than organisations who stated their goals in purely financial terms (Bolman & Deal, 1997)

Finally this part arrives at the conclusion that the field of business ethics on its philosophical basis raises many arguments and contradictions

It cannot yet be answered if “business ethics” can be seen as an oxymoron, because there is a need for further examination of ethical principles and their influence on business practices

1.3 Utilitarianism

The first fundamental ethical approach applied to business ethics is the so called utilitarianism, which will be examined with its two types act- and rule utilitarianism in the following

The first utilitarian philosophers were David Hume (1711-1776), Jeremy Bentham (1748-1832) and John Stuart Mill (1806-1873). Utilitarian theories hold that the moral worth of actions or practices is determined solely by their consequences. An action or practice is right if it leads to the best possible balance of good consequences for all the parties affected. In taking this perspective, utilitarians believe that the purpose or function of morality is to promote human welfare by minimising harms and maximising benefits (Beauchamp & Bowie, 1997). Jeremy Bentham´s aim was to develop a “moral science“ that was more rational, objective and quantitative than other ways of separating right from wrong. Bentham wrote in his famous “Introduction to the Principles of Morals and Legislation“:

“Nature has placed mankind under the governance of two sovereign masters, pain and pleasure. It is for them to point out what we ought to do, as well as determine what we shall do.“ According to Bentham, the benefits and harms produced by actions can be identified and while everyone’s happiness counts, no one’s happiness counts for more than another’s

Based on these findings Mill revised utilitarianism by adding the idea that pleasures and pains could be classified according to quality as well as by amount (White, 1993). In Mill’s approach to utlitarianism he mentioned that it is quite compatible with the principles or utility to recognise the fact that some kinds of pleasure are more desirable and more valuable than others

It would be absurd that, while in estimating all other things, quality is considered as well as quantity, the estimation of pleasures should be supposed to depend on quantity alone (Morgan, 1996)

Hence, several essential features of utilitarianism can be drawn from the above philosophers. First, utilitarianism is committed to the maximisation of the good and the minimisation of harm and evil. It asserts that society ought always to produce the greatest possible balance of positive value or the minimum balance of disvalue for all persons affected. For example, executives in the petroleum industry know that oil and gas operations exist tenuously with wetlands areas, waterfowl and fish. However, if the demands of U.S consumers are to be met, corporate and public policies must balance possible environmental harms against the benefits of industrial productivity (Beauchamp & Bowie, 1997). A second essential feature of the utilitarian theory is the “intrinsic value“. Efficiency in an organisation is valuable as a means toward maximising the production of goods and services. Within utilitarian ethical theory, it is a means for maximising human good. For example, in the language of business, utility is measured by a person’s purchases and pursuits. To maximise a person’s utility is to provide that which he or she has chosen or would choose from among the available alternatives. To maximise the utility of all persons affected by an action or a policy is to maximise the utility of the aggregated group (Morgan, 1996). The third essential feature of the utilitarian theory is that utilitarianism is committed to the measurement and comparison of goods. It says that people must be able to measure pleasurable and painful states and be able to compare one person’s pleasure with another’s to decide which is greater (Beauchamp & Bowie, 1997)

1.3.1 Act Utilitarianism

Utilitarian philosophers can be divided into two types – act utilitarian and rule utilitarian. These two types are considered in the following

“Act utilitarianism says that for every action, we should choose that which would bring about the maximum good for the maximum number of people (Kitson & Campbell, 1996).” According to Mackie (1997), it seems natural to seek pleasure and to avoid pain and distress, but it also seems sensible to balance these against each other, to put up with a certain amount of pain in order to achieve a quantity of pleasure that overweighs it. Act utilitarian will not hesitate to break a moral rule in choosing between alternatives. They might be driven by their belief that their action will lead to the greatest good for the greatest number of people involved. Act utilitarians are unpredictable and at worst unreliable. For example, act utilitarians cannot be trusted to keep their promises or tell the truth, show loyalty or uphold justice because they will only do any of these things when doing so will bring the best consequences (Kitson & Campbell, 1996)

1.3.2 Rule Utilitarianism

The second type of the utilitarian approach is the so called rule utilitarianism. Rule utilitarianism takes precedence over act utilitarianism. Rule utilitarians argue that their belief in rules can escape the objections to act utilitarianism, because rules are not subject to change by the demands of individual circumstances (Beauchamp & Bowie, 1997). Rule utilitarianism looks at the utility not of individual actions but at the rules by which we ordinarily guide those actions. Rule utilitarianism says that we should choose a set of rules by following which will produce the best consequences (Kitson & Campbell, 1996)

1.4 Deontology

The second fundamental approach applied to business ethics is the so called deontology. The philosopher that followed and ultimately became the representative of deontological ethics is Immanuel Kant (1724 – 1804)

The deontological approach of ethics is based on the idea that actions do not have intrinsic moral values

Some actions are considered inherently good (truth-telling, keeping promises, respecting the rights of others), while others are bad (dishonesty, coercion, theft, manipulation). No matter how much good comes from lying, the action will never be right (White, 1993). Kant believed that he had discovered the fundamental moral law that would determine the ethical character of an action without regard to its consequences (White, 1993). For Kant, a good action should not only conform to a moral law, but should be done for the sake of a moral law. All persons inherently have good will, therefore all should act from a sense of duty

Mackie (1997) maintains that deontology leaves room for duties that arise from one’s own previous actions, or from the actions of others that have affected him, such as the duty to fulfil a contract or to show gratitude, or to repay benefits, or to compensate for harm done. Kant maintained that doing your duty is the only thing which ethics requires (Kitson & Campbell, 1996). Therefore, a person’s motive for action must be a recognition of the duty to act; it should be done for the sake of obligation and not because coincidentally happens to be what is wanted to be done anyway. Kant argued that individuals should never be treated as means but as ends. Each person has its dignity, its integrity that should be respected in our dealings with others. Furthermore, Kant stated that you have to act in such a way that you treat humanity, whether in your own person or in the person of any other, always at the same time as an end and never simply as a means (Morgan, 1996)

To exhibit a lack of respect for a person is either to reject the person’s considered judgements, to ignore the person’s concerns and needs or to deny the person the liberty to act on those judgements (Beauchamp & Bowie, 1997). For example, manipulative advertising that attempts to make sales by interfering with the potential buyer’s reflective choice violates the principle of respect for persons. According to the example mentioned above, the organisation should consider the fact that if such behaviour was going to be universally accepted then it was going to destroy the very concept that motives and decision-making should be based on moral grounds. Kant supports the idea that since ethics is a rational enterprise, ethical principles should have the same character as logic and mathematics

That is that they should be internally consistent and universally valid. Furthermore, Kant emphasises that the motives for our actions should be morally based and that decisions taken should be for the right reasons. For example, it is not good enough to act honestly only because honesty pays. If such behaviour is encountered then consequently “honesty“ is cheapened

According to Kantian thinking, if an organisation does the right thing only when (and for the reason that) it is profitable or when it will enjoy good publicity, its decision is prudential, not moral (Beauchamp & Bowie, 1997). Hence, a deontological approach to ethics sees rights to fairness, equality, justice, honesty and the respect of our dignity as rooted in the fundamental characteristics that define our nature (White, 1993)

CHAPTER TWO: Ethical issues in advertising

2.1 Introduction

This study has already discussed two of the fundamental philosophical theories and the important basics of business ethics. The focus in the following chapter will be put on the relation of advertising and ethics

Due to the fact that advertising is addressed to a mass audience, it has also widespread social effects. In order to be able to apply business ethics to advertising practice, later on it is important to define advertising and to explain the role advertising has on consumers and society. Marketing, and therefore advertising, is within all management fields the one that raises the most controversy when it comes to the question of ethics. Later in this chapter the ethical issues in advertising are examined by using the moral and legal discourse to explain the different points of view whether an advertisement is seen as ethical or unethical

2.2 Definition and role of advertising

“Consumers forget and advertising reminds (Sandage & Fryburger, 1960).”

First of all advertising is designed to be persuasive, and the basic purpose of advertising is to identify and differentiate one product from another to persuade the consumer to buy a product in preference to another. Persuasion involves a recognition or belief of the consumer that the advertised product will satisfy a need of desire (Sandage & Fryburger, 1975). According to Lvovich (2002), advertising has the major role to play in persuading the consumer to switch from brand X to brand Y or to stay at brand Y as one’s favourite. Nowadays, Bovee (1992) gave the most popular definition of advertising. He defined advertising as the non-personal communication of information usually paid for and usually persuasive in nature about products, services or ideas by identified sponsors through the various media. In order to gain a fair understanding of this definition each part of this definition is explained briefly in the following

Due to the fact that advertising is directed to groups of people and not to individuals, it is a non-personal way of communication. Advertising as a form of communication uses verbal and non-verbal elements to pass information, ideas or feelings to a person. Advertising in general must generate information about how the product can benefit the customer. Information, defined as knowledge, could be complete or incomplete, biased or deceptive. Most advertising is paid for means, that the costs for creation, time and space in the media must be paid. The products, services and ideas are the things, marketers want consumers to buy, and it is in general a sum of values what the product, service or idea means to the consumer. In order to understand the expression identified sponsors, it is necessary to mention that it is important for the sponsor to identify himself that the audience knows that it is not a competitor’s product. Furthermore, it prevents the audience from getting a misleading idea about the advertisement or its content

Media that are usually used in advertising are television, radio, newspapers, billboards, magazines and so on

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