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Part Seven Special Topics and Perspectives
Belch: Advertising and
Promotion, Sixth Edition
VII. Special Topics and
Perspectives
unintended public perception that it was a racist or
racially insensitive company.
The lawsuit raised a troubling question for the
advertising community as to whether ad agencies can
be held liable for the ads they produce. In its legal
papers Saatchi claimed advertising is a business that
has no explicit guidelines and standards and therefore
that it cannot have committed malpractice. The
agency also noted that the “Kenya” spot was presented
to the networks and was not rejected. Many
advertising executives have argued that while Saatchi
may have used bad judgment in developing the idea
for the commercial and carrying it forward, Just For
Feet was ultimately responsible because the company
approved the spot and should have taken responsibility
for it.
In January 2000 Just For Feet declared bankruptcy,
and two months later its assets were purchased by
21. Regulation of
Advertising and Promotion
© The McGraw−Hill
Companies, 2003
Footstar, one of the largest footwear retailers in the
United States. Footstar now operates over 90 athleticfootwear
superstores under the Just For Feet name.
The company hired a new agency, which has developed
a campaign to rebuild the image of the stores. However,
the former owner of Just For Feet is still pursuing
legal action against Saatchi & Saatchi. A ruling in his
favor in the landmark case could yet create problems
for advertising agencies and have a major impact on
their creative limits, as they would have to be careful to
avoid making ads that might result in their becoming
involved in lawsuits. The outcome of this case could
still be very important to the advertising industry.
Sources: Lisa van der Pool, “Just For Feet Makes TV Return,”
Adweek, Feb. 19, 2001, p. 2; Alice Z. Cuneo, “Can an Agency Be Guilty
of Malpractice?” Advertising Age, Jan. 31, 2000, pp. 24, 25; “Bad Ad
Breeds Worse Lawsuit,” Advertising Age, June 28, 1999, p. 30.
agency for advertising malpractice. If successful, this lawsuit could have redefined the
relationships between advertisers and their agencies regarding responsibility for selfregulation
of advertising. 6
Self-Regulation by Trade Associations
Like advertisers and their agencies, many industries have also developed self-regulatory
programs. This is particularly true in industries whose advertising is prone to controversy,
such as liquor and alcoholic beverages, drugs, and various products marketed
to children. Many trade and industry associations develop their own advertising guidelines
or codes that member companies are expected to abide by.
The Wine Institute, the U.S. Brewers Association, and the Distilled Spirits Council
of the United States all have guidelines that member companies are supposed to follow
in advertising alcoholic beverages. 7 Other industry trade associations with advertising
guidelines and programs include the Toy Manufacturers Association, the Motion
Picture Association of America, the Pharmaceutical Manufacturers Association, and
the Proprietary Association (the trade association for nonprescription-drug makers). 8
Many professions also maintain advertising guidelines through local, state, and
national organizations. For years professional associations like the American Medical
Association (AMA) and the American Bar Association (ABA) restricted advertising by
their members on the basis that such promotional activities lowered members’ professional
status and led to unethical and fraudulent claims. However, such restrictive codes
have been attacked by both government regulatory agencies and consumer groups.
They argue that the public has a right to be informed about a professional’s services,
qualifications, and background and that advertising will improve professional services
as consumers become better informed and are better able to shop around. 9
In 1977, the Supreme Court held that state bar associations’ restrictions on advertising
are unconstitutional and that attorneys have First Amendment freedom of speech
rights to advertise. 10 Many professional associations subsequently removed their
restrictions, and advertising by lawyers and other professionals is now common
(Exhibit 21-2). 11 In 1982, the Supreme Court upheld an FTC order permitting advertising
by dentists and physicians. 12
Research shows that consumers generally favor increased use of professional
advertising. However, professionals continue to have reservations. They worry that
advertising has a negative impact on their image, credibility, and dignity and see benefits
to consumers as unlikely. 13 Still, advertising by professionals is increasing, particularly
among newcomers to medicine, dentistry, and law. Associations such as the
AMA and the ABA developed guidelines for members’ advertising to help maintain
standards and guard against misleading, deceptive, or offensive ads.