This chapter explores the ethics of marketing and advertising

As the most visible form of marketing, advertising is one of the principal motors of a capitalist economy and also one of the largest modern industries: The global advertising (the United States was the largest national market at $152 billion). 1 Advertisements not only inform consumers of available products, services, promotions, and sales, they serve a vital business function by allowing brands to distinguish themselves from competitors, which rewards firms for improving the quality of their offerings. Advertising is a key ally for innovation, because advertising allows firms to create awareness and desire among consumers to buy new products. Despite these benefits, the advertising industry has long been suspected of using devious tactics. As a result, many consumers are highly skeptical and even disdainful of advertising in general.

Advertisers sometimes take the risk of shocking the public with their ads because they are seeking to break through the communications clutter of modern life. Today, the average American is exposed to a great number of advertising messages every day, with estimates running from several hundred to several thousand ads per day. 2 In order to attract the public’s attention, advertisers may resort to appeals and tactics of questionable taste. Little wonder that more than half of Americans believe that advertising today is out of control. Social critics point to advertising as one of the most objectionable aspects of our consumer economy. From the billboards that blot out the countryside along highways, to the television shows that are interrupted every few minutes by outlandish commercials, to the mailboxes and e-mail accounts that become cluttered with direct marketing, advertising methods are often criticized for being intrusive, offensive, silly, and even dishonest.

For example, in the case of skin creams, cosmetics, perfumes, deodorants, toothpaste, mouthwash, and so on, advertisers typically claim (or suggest indirectly) that their products make the consumer more physically attractive, especially to the opposite sex

As a result of the perceived abuses of advertising, national governments all over the world have imposed laws and regulations on the advertising industry. Every country or region has its own area of sensitivity. In many Muslim nations, for example, there are prohibitions against advertisements that display nudity or offend traditional notions of decency.

France and Germany prohibit comparative advertisements in which one brand claims to be superior to another

The modern marketplace abounds with products that pose difficult challenges for regulators. Consider the example of tobacco and alcohol. These products can be harmful or dangerous, but many people nonetheless desire to consume them. Most Western countries have decided that it is counterproductive to outlaw the sale of tobacco and alcohol, as doing so may create a black market and stimulate organized crime. The official response of most governments has been to allow the sale of such products but to prohibit or strictly constrain their advertising. Other product categories that tend to be governed by specific advertising regulations include pharmaceuticals and financial products.

Many products have positive uses but can also be dangerous if misused, like automobiles, knives, razors, lighter fluid, pesticides, toys, athletic equipment, and so on. In such cases, the law usually prohibits advertising that encourages the consumer to use the product in a dangerous fashion. Another common type of marketing regulation is one that prohibits advertisements from making false, deceptive, or misleading claims. In most countries, such rules are enforced by the ministry for consumer affairs. In the United States, rules against deceptive advertisements are promulgated and enforced by the Federal Trade Commission (FTC).

There are certain product categories in which exaggerated claims are commonly made. The problem is that some consumers may not be sophisticated enough to discern the difference between innocent puffery and claims of effectiveness. Thus, teenage boys have been known to douse themselves with Unilever’s Axe deodorant products in the hope that they will attract females as effectively as is suggested in Axe’s notoriously provocative advertising. Many advertisements for such products come so close to making deceptive appeals that they may trigger the FTC’s attention As a result, advertisers have learned to be cautious in the precise wording of their claims. For example, advertisements for skin cream may permissibly suggest that the user’s skin will “look and feel better” after use of the product, but they cannot include text guaranteeing the disappearance of wrinkles.