3-1

Controversies

Economic Societal affect product value?

make us morematerialistic?

increase prices?discourage

competition?

affect demand?

make us buy thingswe don’t need?

debase language?

affect art?

affect us subliminally?

influence consumerchoice?

Does advertising . . .

3-2Economic Impact:Billiards Model

Insert ex. 3-2, p. 59, Advertising billiards

Position = centered horiz., 1.5” vertical

Size = 4.6” TALL

Resolution: 300 dpi

3-3Economic Impact:Four Affected Areas

ProductValue

-Communicates brand image

-Educates customers

-Associates w/ desirable image

3-4Economic Impact:Four Affected Areas

ProductValue

Prices & Competition

-Communicates brand image

-Educates customers

-Associates w/ desirable image

Increase:

-Branding

-Ad costs

Decrease:

-Competition

-Efficiency

3-5Economic Impact:Four Affected Areas

ProductValue

Prices & Competition

Consumer Demand

-Communicates brand image

-Educates customers

-Associates w/ desirable image

Increase:

-Branding

-Ad costs

Decrease:

-Competition

-Efficiency

Primary:

-Product Category

Secondary:

-Particular Brand

3-6Economic Impact:Four Affected Areas

ProductValue

Prices & Competition

Consumer Demand

Consumer Choice

-Communicates brand image

-Educates customers

-Associates w/ desirable image

Increase:

-Branding

-Ad costs

Decrease:

-Competition

-Efficiency

Primary:

-Product Category

Secondary:

-Particular Brand

Product differentiation

3-7Economic Impact:Abundance Principle

In an economy that produces more goods & services than can be consumed, advertising:

Self-interestComplete

information

Absence ofexternalities

Many buyers& sellers

Allows more-effective

competition

Stimulates competition

Keeps consumers informed

Self-regulates to keep market free & open

3-8Social Impact:Two Types of Criticism

Short-term manipulative arguments

Deception:puffery, nonproduct

facts, bias, inaccuracy

Proliferation Stereotyping Offensive

Social impact Impacts values

Long-term macro arguments

Subliminalmyth

3-9

Social Responsibility and Ethics

Promotewell-being

Promoteharmony &

stability

Influenceelections

Drawcrowds to

events

Responsibleadvertising

can . . .

Ethical:morally right

Socially Responsible:what society views as best

3-10

Ethics of Advertising

Insert ex. 3.3, p. 73

Levels of Ethical Responsibility

Position = 0.4” horizontal, 1.5 vertical

Size = 8.2” WIDE

Resolution = 300 dpi

3-11

How Government Regulates

Provinces:governor

City/Towns:mayor,

police chief

National:Legislative, Executive,

Judiciary

3-12Current PhilippinesRegulatory Issues

Tobacco Controversy

Consumer Privacy

Government Regulations

Advertising to Children

3-13NongovernmentRegulation

Advertising Board of the Philippines Philippine Association of National Advertisers (PANA) Association of Accredited Advertising Agencies Print Media Organization (PRIMO) Kapisanan ng mg Brodkaster sa Pilipinas (KBP) Advertising Suppliers Association of the Philippines (ASAP) Marketing and Opinion Research Society of the Philippines

(MORES)

Regulation by the media

Regulation by consumer groups