Effective Disclosures in Advertising

May 22, 2001

HALL DICKLER KENT GOLDSTEIN & WOOD LLP

Assignment

Review creative concepts provided for a fictitious product, LetsGoTV

• Develop alternative print and television concepts to– Drive demand for the product among the target

audience– Clearly and accurately disclose product

information

Analysis of LetsGoTV Creative

Legal Problem• Advertising implies product can

be used everywhere - does not adequately disclose indoor limitation– “Don’t you wish you could

watch TV anywhere you want?”

– “You’ll get your favorite local channels anywhere”

– “Watch whatever you want wherever you want.”

– “Goes everywhere you go.”

Position outdoor limitation use as a product benefit

Analysis of LetsGoTV Creative

Legal Problem• $199 Price claim is misleading

– Super with mail in rebates. Restrictions apply - not adequate

– Asterisked disclaimer in print ad - $199 after rebate - not adequate

– Inadequate disclosure that $199 is the after rebate price

Reposition price claim to reduce limitations/conditions

that would require disclosure

Analysis of LetsGoTV CreativeLegal Problem• $199 Price claim is misleading (cont.)

– Inadequate disclosure that rebate is subject to material conditions and restrictions:

• 12 month subscription to LetsGoTV with penalty for early cancellation

• Premium Service at additional $45/month charge

– Inadequate disclosure that antenna is required for cable reception at additional cost of $99

Reposition price claim to reduce limitations/conditions

that would require disclosure

Analysis of LetsGoTV Creative

Legal Problem• Advertising fails to clearly and

conspicuously disclose that subscription to LetsGoTV Premium Service is required to access premium channels - disclosure in footnote is not sufficient– Type size too small– White type on red background in

print ad is hard to read– Disclosure in TV ad is buried

Reposition cable subscription requirement

as a product benefit

Analysis of LetsGoTV CreativeLegal Problem• Disclaimers are not sufficiently clear

and conspicuous– Information is too material to be

handled in a disclaimer– Disclaimer in TV ad is too long

and too small– Disclaimer in print ad is too

small, difficult to read and not against a contrasting background

Simplify the creative to reduce need for

disclaimers

The challenge...• Unique product proposition which requires a unique selling

proposition

– Lightweight, large screen handheld portable TV device

– Only works outside - cannot get reception inside buildings, inside cars, or in other enclosed spaces

– Receives cable channels but only with subscription to LetsGoTV cable services and an antenna (both extra)

– Most expensive handheld portable TV device on market

– Rebate available - but only with purchase of one year’s subscription and only after 12-months

The solution...• Change the focus - rename, reposition and sell it as a whole

system/package:

Let’sGoCable = cable subscription + viewer

– Communicates offer clearly to consumers– Focuses on key point of difference vs. competition:

• cable on a handheld portable device– Ideal selling proposition

• sell subscriptions and the devices will follow» Year one - $897.40 (after rebate)

The solution...• Develop a positioning to leverage the unique attributes

of the product and make it appealing to the people most likely to purchase it

Cable TV for people who don’t want to miss their favorite programming when they are outside.

– Upfront about “outside” limitation

– Turns perceived negative into a positive

– Focuses benefit directly to those most likely to purchase

The consumer...

• Talk to the people most likely to find the proposition compelling and relevant:

Males, ages 30-59

– Willing to spend money on TV technology – Love their cable– Spend time outdoors in activities that will allow for

simultaneous TV viewing

What do we know about them?

• Important pre-req for our offering

– average TV cost: $300 - $500

– handheld TV cost: $5 - $170

– Year one LetsGoCable cost: $897.40 (after rebate)

• Males are 10 times more likely to purchase high end TVs than Females

• M30-59 are willing to spend over $700 on a TV

– M30-34 are 32 times more likely to spend $700-$999 on their last TV

– M50-54 are 55 times more likely to spend $1,000+ on their last TV

Willing to invest in TVs and TV technology

What do we know about them?

• In the past, the older end of the target has been more likely to purchase portable TVs (Index 120)

• There is an opportunity to expand the portable TV user base to include younger end of our target based on this offering– M30-34 - wants products that offer the best

technology: Index 135

What do we know about them? They are avid consumers of cable• M30-59 fall within the heavy cable consumption

category (15+ hrs in past week)– M30-34 Index 116; M50-54 Index 119

• M30-59 are 20% more likely to own a satellite dish– M30-34 Index 124; M50-54 Index 149

What do we know about them?

They participate in outdoor activities that allow for

simultaneous TV viewing

– Camping– Boating/sailing– Fishing– Yard work – Going to the beach– Having Picnics

The Concept

Now going outside doesn’t mean going without cable. With the LetsGoCable System you can receive your

favorite cable channels on our exclusive portable satellite equipped viewer.

LetsGoCable. It’s time to cut the cord.

Open on a man fishing on an empty lake.

A scene from ‘Fight Club’ appears on the lake’s surface around him.

(ShoMax ghost logo)

The ‘Fight Club’ scene disappears as a scene from a

Rap Video appears

(Music Video TV ghost logo)

The rap video disappears as a baseball game appears (Box Seat Sports ghost logo)

FVO: Going outside doesn’t have to mean going without your favorite shows. Get the LetsGoCable System. Our exclusive handheld viewer is just $498. And subscriptions are just $49.95 a month.

LEGAL: For outdoor use only.

Product Shot /Super: $200 BACK

Pullback/Reveal man holding viewer while fishing

FVO: Order today and get a $200 mail in rebate after 12 months of service.

LEGAL: 12 months subscription required for rebate. $50 cancellation fee for early termination.

FVO: LetsGoCable.

It’s time to cut the cord.