Question

1. Do you think that there should be limitations on advertising by the government? Explain your answer. Identify and explain at least two regulations on advertising.

2. Late night direct response advertising (or infomercials) use a long advertising format to persuade people to purchase various forms of exercise equipment, diet products, household products, self-improvement products, and so on. These products are often associated with a special offer and even a finance plan of several payments. It could be argued that many of these products are sold this way because retailers will not stock them. Come up with a list of at least 5 products that are sold through direct response advertising. Classify your list into products that you think have value to consumers and those that don’t. Do you think that direct response marketers have a right to sell and promote products, regardless of their potential value? Defend your position.

Answer 1

Answer to Question 1)

Advertising is rapidly used as a medium to attract sales into business. The key benefit of advertising a product is that people clearly identify the use of the product and promotional activities can help in driving sales and connecting with people. It also helps in creating brand value in the long run.

In my opinion, advertisements indeed need to be regularized by strict laws which the government needs to set in place. Advertisements have the potential in them to sell products which may not be suitable for consumers or which not may be legal in the first place.

Accordingly, following are two laws which are present on advertising in the United States for Advertising.

1) Federal Trade Commission Act: -

The Federal Trade Commission act, was set up to ensure that any ill practices by manufacturers does not take place. Section 5 of the act takes care of the advertising also.

The section states that advertisers must tell the entire truth to the consumers and cannot be deceptive in their tactics. For example, a car rental service cannot advertise as unlimited mileage when in reality this is capped at 100 or 200 miles per day.

This ensures that advertising is as per the services or product provided and consumers are not misleading.

2) The Lanham Act: -

The Lanham Act is another act which covers false and misleading advertising. For example, if your competition was using false information stating that your product was inferior to theirs in whatever manner and was advertising the same, you have a legal right to sue them as per section 43 A. Also, you cannot claim that your product is doing greater than it actually is.

For example, if your soap bar advertisement was claiming to kill 100% of all types of germs then that must be substantiated with evidence failing which it could be charged with misleading and false information respectively.

Answer to Question 2)

We often happen to see late night long sponsored advertisements which lay down and tell us about different goods and services which may or may not be advantageous for us.

In my belief however, the efficacy of the claims being made on television must be substantiated and verified before these people can be allowed to sell their products freely in the market place.

In reality, often these people target vulnerable individuals and that unaware end up buying products in hope that the quality displayed on tv may match in real life while this does not often happen.

For the purpose of answering the case study we identify 5 products that are sold through direct response advertising and whether or not these are advantageous in reality.

1) Health Supplements: -

Often through direct response advertising we see online health supplements being sold to the general public for a price. These supplements however in most cases do not possess the same potency as described in the commercials. The ingredients at times are also not the same as advertised and the efficacy of these products is often not tested. They may also have side effects which are never described. These include weight gainers, losers, protein supplements for gym lovers etc.

In my opinion these do not add value to the customer and such products have hidden side effects also which are never advertised or indicated that what effects over consumption may have for the end consumer. Safety guidelines are never displayed and this is a serious challenge therefore.

2) Lucky Charms: -

In developing countries such as China and India, lucky charms are sold through this medium over late night marketing strategies. These things are said to be made and sourced from monks and other religious places but often tend to be fake. At times even fake testimonials are given which do not add any value to the end consumer.

3) Household Products: -

Household products such as kitchen equipment, peelers, knifes, bed sheets, covers, pillows etc are also often sold on the platform. In my opinion a lot of information is provided about these products to the audience and they in general are indeed beneficial to the end consumer.

4) Apparels: -

Another category of goods that is sold across these platforms are fashion apparels. Clothes are often sold on the medium and can be returned if the quality does not meet the expectations of the buyers in most cases. These indeed add value to the customer and great deals at times are available for the end users.

5) Technological Equipment: -

Often technological equipment such as mobile phones, laptops, computers etc are sold on these platforms which again are beneficial for the end consumer. These products at times may also be older ones which get sold to consumers who want to pay a relatively lower price. Further, reviews are freely available on the internet and through word of mouth and it becomes easy to buy and sell such products.

Opinion and Conclusion: -

In my opinion due to the possible flaws of such marketing, these must be governed by strict laws which must limit the advertisements on fake products which do not add any value to the end consumer. Strict regulations would ensure in the long run that ill practices are curtailed and producers and marketers must not be given a free hand in doing whatever they would want to.

Please feel free to ask your doubt in the comments section if any.