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Legal and Ethical Implications


Must sponsor's name be mentioned in a commercial? Yes, public must be aware that it's ... Complaints about the Taco Bell chihuahua ('Yo quiero Taco Bell. ... – PowerPoint PPT presentation

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Title: Legal and Ethical Implications

Chapter 3
  • Legal and Ethical Implications

  • Federal regulation
  • Federal Communications Commission
  • Sponsorship identification Must sponsors name
    be mentioned in a commercial?
  • Yes, public must be aware that its listening to
    an advertisement. Sponsors name must be
    mentioned at least once.
  • Payola and Plugola What are they? Payola
    Penalty, 10,000 fine and year in jail Plugola
    announcer plugs product, not mentioning that
    he has received payment or some inducement.
  • Station-conducted contests What do you always
    hear about contests on the radio?
  • Station must disclose the terms of the contest
    (What are they?)

  • Political sponsorship identification . What do
    you always hear at the end of a political ad?
  • Sponsor of a political ad must be clearly
    identified listeners must know they are
    listening to a political ad and understand who
    paid for the broadcast time.
  • In Radio spots, announcement at the end in TV
    ads, sponsor information may be presented
  • What is Equal time? .If a station carries an
    ad for one candidate, it must carry ads for

  • Liquor advertising Why did liquor advertising
    not appear on TV until 1996? Liquor industry
    voluntarily refrained from broadcast advertising
    never a law against it.
  • Stations cautious about liquor advertising,
    fearing backlash against beer and wine
    advertising (cigarette advertising banned in
  • Federal Trade Commission protects the public
    from unfair and deceptive business practices,
    including false and misleading advertising
  • Deceptive advertising What makes advertising
    deceptive? Deliberately false demonstrations or
    statements or true statements that convey a
    misleading implication.

  • Rigged demonstrations FTC expects advertisers
    to show a product as it really is not altered
    for effect.
  • FTC tolerates a certain level of exaggeration
    What about the statement Bayer works wonders?
    Such exaggerations are known as puffery
    broad, vague, laudatory language.
  • FTC believes everyday consumers are intelligent
    enough to recognize puffery and not take it
  • Volvo fined for misrepresenting the strength,
    crashworthiness and structural integrity of its
    automobiles Pickup driving over a row of
    automobiles, all crushed except the Volvo Volvo
    was structurally reinforced, others not.

  • Testimonials must celebrity endorsers use the
    product? Yes, testimonials and endorsements must
    be genuine.
  • Actors need not actually use a product but if
    you identify a person as Mrs. Jones of Omaha,
    she must be Mrs. Jones of Omaha (unless an
    obvious spoof).
  • Comparative advertising comparative ads should
    not disparage or unfairly attack competitors.
  • Research data .claims based on research must not
    be false or misleading

  • Truth in lending Why the rushed reading of
    legal information at the end of an ad? Advertiser
    must fully disclose all credit terms.
  • Self-regulation ethical questions
  • Stereotyping What is it? Shorthand used for
    convenience. Help to avoid character development.
    Guy in the black hat (bad guy) young man with
    thick glasses (geek) burly college athlete
    (dumb jock).
  • Viewers may come to believe stereotypes are true,
    or almost always true.
  • What are some stereotypes of women?
  • What are some ethnic stereotypes? Complaints
    about the Taco Bell chihuahua (Yo quiero Taco
    Bell.) Others liked the Chihuahua and the
    character survived.
  • Avoid blatant and unflattering stereotypes.

  • Cable advertising
  • Cable is regulated more by local franchising than
    FCC. Not required to observe the FCC rules for
    sponsorship identification and contests.
  • But cable must observe FCC political sponsorship
    identification rules.
  • FTC may regulate advertising in all media.