Without a few rules, life would be chaotic. The advertising industry is just the same. Its various self-regulatory bodies have been working tirelessly throughout history to protect consumers, promote competition and avoid government intervention. We can be thankful for these actions, but many times consumers are unaware of the protections out there. This is a little thank you note to advertising.
The 1910s and 20s saw the first calls for truth in the advertising world and again in the 70s and 80s. Three influential consumer movements occurred in the 1900s, 1920s-30s and the 60s. According to an economics library site, “In the early 1900s the American consumer movement addressed two overriding issues: the human misery caused by poverty and the prevailing caveat emptor attitude” (ebrary.net). In the 1920s,Stuart Chase and Frederick Schlink wrote the first anti-advertising book “Your Money’s Worth”.
The 1930s gave rise to “the notion of the consumer as a vital component of economic policy, alongside capital and labor” (Ad Age, 2003). Consumer research groups published product reviews and gave the public access to full price and product quality information. Thirty years later during the next consumer movement, art played a big part in making changes. Rachel Carson’s “Silent Spring” (1962) was released and is often credited with beginning the environmental movement in the United States, and Ralph Nader’s “Unsafe at Any Speed” expose targeted General Motors Corp.’s Corvair, a vehicle that many considered a serious road hazard. Nader also created consumer advocacy groups on college campuses that investigated everything from baby food to insecticides, unfair insurance rates to natural gas pipeline safety.
The National Advertising Division of the Council of Better Business Bureaus has seen various successes. The NAD actually self-reports a 95% success rate in “reviewing disputes and coming to a quick, transparent determination”. This is partly due to competitors wishing to avoid costly court cases and further government regulation. Chris Cole, attorney & self-regulation expert for Manatt, Phelps & Phillips, says “A lot of stuff gets pulled because companies are watching each other. The combination [of NAD and FTC] is certainly better than just having an enforcement agency…It’s not perfect, but it’s a better world with it than without it.”
One advertising attorney Terri Seligman says the NAD is successful partly because, “It’s in everyone’s interest that advertisers don’t lie.” More than 90% of advertisers comply with NAD decisions, usually to avoid government action. Some rules established by NAD precedent include the following.
In the case of Andersen Corp, a window and door manufacturer, the NAD regulated that reenactments can be dramatized but must accurately portray how the product performed. So you can exaggerate the “hotness of the housewife,” just not the benefits of the product. A Mercedes commercial was an example of how humor isn’t an excuse for inaccuracy. The ad showed another car crashing into the Mercedes and bouncing off with no damage to Mercedes. Most consumers would understand this to be a humorous exaggeration. But, the NAD is more concerned with providing the public with realistic examples of product performance.
Think Gorilla Glue is the “toughest glue on earth?” Think again. Some elements of puffery are approved by the NAD, but other claims such as this one may allude to the ability to be substantiated when they couldn’t possibly be. The NAD is also cracking down on “clean” products based on their ingredients. Tom’s of Maine mouthwash, Clorox Green Works Natural Cleaning Wipes, and Whole Foods Seventh Generation are just a few. And don’t even think about hiding an ad behind the guise of an instructional video. Dyson almost got away with it on YouTube, but NAD labeled comparative demonstrations as commercial speech. Even names of products must contain substantiate-able claims, unlike Bayer’s One-a-Day All-Day Energy.
Apple tried to get away with saying that their products were greener than Dell’s. However, when you consider the harmful effects of manufacturing, chemicals, and solvents, it’s hard to make a good case for it. The NAD has even gone so far as to scrutinize the use of cartoons. They decided that the animated demonstration of a Charmin Bear using toilet paper “overstated the extent of the product superiority”. Now, Charmin has to show a “few specs of cartoon toilet paper on their rears” in order to convey product accuracy. You can decide if these regulations are valuable, but you can’t say that the NAD isn’t trying.
When you look at the challenges face by the industry, you almost feel bad for advertising’s self-regulating bodies. Given the circumstances, advertising has done pretty well for itself. Self-regulation started off rough, but over the years we have progressed and will continue to do so. A spirit of honesty, friendly competition and value of consumers are part of the solution. Despite its many failures, advertising’s self-regulatory bodies have made some valuable contributions to protecting consumers from harm.