Title of Thesis

Ethics in advertisement: A case of packaged milk industry, Lahore

By

Adnan Nizamuddin Haider

Thesis is submitted to Lahore School of Economics in the fulfillment of the requirement for a Bachelors Degree in Business Administration.

DECLARATION

This thesis contains no material, which has been accepted for the remand to the candidate of any other degree or diploma, in any university or other institution. To the best of my knowledge the thesis contains no material previously published or written by another person, except where due reference is made in the text of the thesis.

_______________________ Adnan Nizamuddin Haider BBA (Honors) with majors in Finance ID: 05U308

CERTIFICATE OF APPROVAL

I certify that I have read Ethics in advertisement, a study of packed milk industry Lahore by Mr Mazher-ul-Haq Baluch, and that in my opinion, this work meet the criteria for approving a thesis submitted in partial fulfillment of the requirements for the Degree of with Majors in finance at Lahore School of Economics

________________________________ Thesis Supervisor: Mr. Mazher-ul-Haq Baluch Centre for Research

Table of Content

Abstract ____________________________________ _5 Introduction __________________________________6 Determinants of ethical advertisement_____________ 10 Managerial and academic value__________________13 Problem Formulation__________________________14 Study Objectives_____________________________15 Hypotheses to be tested_______________________ 16 Reviews of Literature_________________________17 Sampling procedure and sample size_____________ 28 Theoretical framework______________________ Results of Study___________________________ 30 31

Conclusion________________________________ 48 Recommendations___________________________50 Related Definitions_________________________ 51 Theoretical Framework ______________________58 References________________________________ 59 Questionnaire _____________________________60
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Abstract

Ethics in advertisement is a broad topic that has its direct bearing on all the stakeholders involved. The stakeholders would consist of the firm itself, the advertising agencies using print or electronic media and the consumers. Now-a-days the firms or the advertising agencies are criticized for misleading, deceiving, and exploiting consumers that is either done intentionally or intentionally by the advertisers. This is where ethics in advertisement comes into play in advertisement. Through this research some of the methods in which advertisers are following ethical or unethical practices within packed milk industry will be examined with the help of predefined clear set of research objectives. And the results of the study will be tested through collection of primary data against the set of objectives set

Introduction

Ethics in general is defined as a code of conduct involved in doing a certain thing. Advertising means to transmit a message via a medium to the target market. The mediums commonly used for advertisement consists of electronic, broadcast and print. Ethics in advertisement is broad term that refers to the code of conduct being followed by the advertisers while advertising their products. The advertisers have to give importance to some aspects like religious and cultural values being followed in a society of that particular country. Religious values are basically the sets of values that majority of a citizens in a society holds and believes in. Whereas social values are composed of identifiable attributes of a society that it is known for like its language, age, gender, ethnic backgrounds with religion being a part of it. Language, culture, gender has direct bearing on advertisement. The information provided by milk advertisement needs to be reliable for the consumers in a complicated society like ours with different sets of culture value/traditions , different languages spoken in different regions , ethnic background, gender and different religion . So considering all this advertisers should consider all of these aspects while advertising for the advertising to be acceptable in our society. Theoretically speaking milk is one of the major diet items for consumer belonging to any country. It is used day to day in cooking and drinking purpose. There was no concept of packaged milk in Pakistan. During those days milk obtained from Buffaloes and Cows were transported to consumers. However during 1990`s consumers specially in urban areas became well aware of the fact that milk produced by local Buffaloes and Cow was non hygienic. It had certain impurities and mixtures. Consequently to give a long life to a perishable commodity and concept of impurity resulted in establishing a unit of packaged milk. That gained immense popularity especially in urban areas due to awareness created by advertisements and the product got general acceptance in short time .
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In late 90`s it adapted a form of an industry. Many companies emerged in the market due to increasing consumer demands. Hence they were able to generate a reasonable amount of success. Now there was a competitive environment within the industry. Every of the companies has ensured to produce good quality standard milk having its unique selling point to the consumer ensure that consumers to differentiate amongst the available product. The prices were competitive by reviewing of market continuously so that none of the company gain competitive edge over other. Apart from this they have been involved in reviewing changing consumers demand and have been trying to attract consumers to buy there product. The milk producing firms even have diversified there stakes to ensure that they come up to the expectation of consumers by introducing various varieties if milk. Now that the consumers have gained

awareness and become more health/diet conscious and have option to choose between low fat milk and normal milk that has high fat contents. A proper range of dairy items have been introduced by these companies that range from various kinds of milk and yogurts. The milk advertisements in Pakistan seemingly are ethical as compared to other product advertisements. That comes up to the expectation of the masses by considering aspects like traditions, religion, and culture. However advertisements of few companies during the recent past have tried to arise emotional appeal with the help of exaggerated family traditions in attempt of attracting consumers to buy the product. The milk advertisement is also engaging a great deal in endorsing celebrities from the fashion as well as the film industry to induce consumer purchase. The competitive nature of the Packaged milk industry with a large number of brands competing to gain the highest share of market or in the other words to capture highest market share are also competing not only in terms of product quality, price but also in terms of advertisement. So this leads to issue of excessive advertisement that is desirable as well as
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undesirable by our society. So the questions remains are the advertisers acting ethically or not considering the social and cultural desirable manner?

Determinants of ethical advertisement

One of the primary aims of this piece of research paper is to determine the key elements that effect ethical advertisement. Following are the factors that affect ethical advertisement: I. Social values and cultural values A social value consists of shared belief within a society and it is something that distinguishes one society from another society. It consists of religion, age, gender, language, ethnic background, Culture and sub culture of a society. II. Language The language of a society is something that truly differ the one society from another. So the advertisers should ensure that they consider this aspect while advertising as this the major element that leads to their success or failure of advertisement. If the language is not understandable and is not acceptable to a society that the advertisement campaign for the company remained unsuccessful as it is considered unethical. Apart from this the tone of advertisement addressed by the advertisers to its potential target market is the single most important factor affecting ethics in an advertisement.

III.

Religion Apart from language, religion is an important factor effecting ethics in advertisement. Religion is accepted and a followed by the people in a society faithfully and they believe in. So in the society and religion like ours it is the need of time that the advertisers should
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not engage in vulgarity while advertising or indulge in such activities that isnt acceptable. IV. Age Another important element of demographics features of a society is age so the method in which the advertisers are using age to make or induce sales from consumers in different age brackets is considered to be ethical or unethical. For instance people in younger age brackets tend to have better memory span as compared to people in older age brackets and they are attracted more easily by an advertisement so the advertisers are inducing sales rather than making sales than again is strictly against the ethics. The ethics of advertisement determined a great deal by age. V. Celebrity endorsement Another factor that determines ethics in advertisement is the role of celebrities. Celebrities are considered to be an attractive source or in another words considered to be role model for most of the people. So the advertisers are using them to arise emotional appeal to induce sales rather than making sales. So the way a celebrity is used in an advertisement is considered to be an important factor in judging ethics in advertisement. VI. The perceived role of advertisement The major role of advertisement of today is to inform, remind, persuade and entertain. However they are perceived by the advertisers in different sense, and they affect ethics in advertisement in different ways. For instance if the role of a specific advertisement campaign is to inform consumers about the product this would mean that consumer

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would be given perfect information as in they would not be deceived, mislead about a certain product. So this would mean that ethics in advertisement are being followed effectively.

VII.

Other behavioral aspects Aspects like attitude, perception and behavior of consumers are immense factors that indicate that ethics are being followed by advertisers. If an advertisement is able to change consumers attitude, behavior and perception within the social and cultural boundaries that means that advertisement is ethical.

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Managerial and Academic Value

My research of ethics in advertisement could be of immense importance to the management of milk producing companies. As this was a new concept in Pakistan it might motivate to look into their current practices to see whether they were acting in an ethical manner while securing the interest of all the stakeholders. It would also be of immense help to the management of the advertising department/ advertising agency. They could examine that all the ethical factor were considered while in case of advertising milk products. They are avoiding abusive language and vulgarity considering our religious practices. They should even avoid excessive time telecasting not to tease the consumers lastly it about time that should not arise emotional appeal of children while making advertisements. Apart from this student academia might also use my document as reference guide. It would determine the relevant relationship between variables effecting advertisement and also marketing. So the scope of this topic would be broad and would be helpful to students willing to conduct research on various ethical aspects of the Packaged milk industry.

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However in the delimitation the highlighted elements such as culture, religion and role of advertisement and other factors of qualitative nature determining ethics in advertisement could not be calculated.

Problem Formulation
Packed milk sector was getting rapid expansion during the recent past. The consumer has become well aware of hygiene, vitality and diet and was experiencing massive expansion in its use especially in urban areas. The role of advertising agencies cannot be ignored. However regarding expansion of comprehension of the consumers in the matter of selection of products as was the interest of all the internal and external stakeholders rights were being secured following all the rules set by the government authorities for packaged milk industry. As far as the information provided by milk advertising agencies are concerned there advertising was not deceptive and misleading for consumers in the society with different cultural values/ set in different religion, ethnic background, gender, different religion/sects and different language in the packed milk industry.

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Study Objectives

I.

To

examine

that

regulation

were

positively

affecting

ethical

advertisement in relation to externalities.

II.

To asses that ethical advertisement was effected by competition. To observe celebrities attractiveness in influencing brand loyalty in advertising ethics

III.

IV.

To examine religion , culture, language , age, lifestyle impact on consumers or ethically oriented advertisement has on response

V.

To visualize advertisement pattern ethics

in accordance to regulating and

VI.

To see the information provided by ads influences believes of consumer segments.

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VII.

To recommend certain measure to make advertisement ethically acceptable.

Hypothesis to be tested
I.

H0: 1=0 Competitive price has no significant effect on ethical advertisement H1: 10 Competitive Price has significant effect on ethical advertisement

II.

H0: 2=0 Television as an accurate source of information has not a significant impact on ethical advertisement. H1: 20 Television as accurate source of information has a significant Impact on ethical advertisement.
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III.

H0: 3=0 Use of Urdu Language has not a significant impact on ethical advertisement H1: 30Use of Urdu Language has a significant impact on ethical advertisement.

IV.

H0: 4=0 There exists no significant relationship between water pollution and ethics H1:4 0 There exist significant relationship between water pollution and ethics

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Review of Literature

Kahle, R (1985) In the article titled Physical attractiveness of celebrities discussed the role of celebrities in influencing consumer perception about a brand or a product through advertisement. He tried to convey that celebrity source attractiveness was one of the major factor to change consumer attitude and purchase intentions. He also considered ability of celebrity and participants involvement or in other words consumers involvement was an important factor also. The methodology that he used in this was basically based on social adaption theory. The product he chose to conduct a

research was the disposable razors as a prototype. The results indicated that celebrity endorsement by a company had a significant impact to changing consumers attitude regarding disposable razors hence leading to brand

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awareness and loyalty would create consideration that the celebrity was liked by the consumer as an attractive source.

Gardner, P (1983) In her article titled

Advertising Effects on Attributes

Recalled emphasized about the specific attributes of a brand that enhanced consumer recalled appear to be strongly influenced by the way consumer processing of advertisement .Through this research the author Gardner found out that the target audience of a specific brand was more influenced by characteristics of a brand led to brands recall as compared to non- target audience which was not influenced by it. She claimed that brand

advertisement was eventually the element that affects the recall of attributes. According to the author it was absolutely compulsory for the person who is involved in advertisement to distinguish between the facts it

was processing that led to recall and latter led to attitude formation. The results also showed attitude alone was not the best method to evaluate brand. Therefore the author believes that more research was needed to explore attitudes of consumers and to find other factors other than attitude.

Murray, S (1986) In his article titled integrating Management and Marketing Theory evaluated the management of a firm that was effected by lack of standards due to the social responsible behavior. Strategic management had its implications here that effect the operations of firms. The argument was that social responsibility hinders the profitability of the firms however on the other side it improved the credibility of a firm. The objective of the marketing approach is was to produce consumer goods independently within a social system.
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The main problem with

marketing approach applied alone was that firms only concentrated on profit taking and ignored its social responsibility. Due to the problems need arose to integrate both management and social responsibility. He viewed integration of social responsibility with marketing approach as a type of product management that determined corporate behavior as compared to moral, ethics and social obligation internally as well as externally. It was successfully achieved by identifying the target market and then addressing to them the marketing mix while keeping the social responsibility of its market. Gatewood, R (1991) In his article titled Assessment of ethical Performance tried to measure variables based on management principles. He attempted to develop a methodology by taking into consideration all the previous standards by examining the elements in light of ethics. Firstly in this article major stakeholder of employees, owner, and management etc the business were identified. The article tried to categorize these stakeholders into

groups for the purpose of accountability .The last part of the article tried to divide the performance of groups and units into behavior or resulted according to the standards set by the organization..The standards that had been used in this article consisted of certain laws imposed by the organization itself or by standards set professionally. In the concluding part of this article relationship between ethical performance and economic performance had been described. Koslow, S (1994) In his article titled Exploring Language Effect discussed and provided

socio-linguistic point of view about the role of advertisement under different ethnicity and culture and the roles of minorities. The author basically examined the consumers belonging from
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different ethnic background, culture and sub culture responded to the language being used in an advertisement. He took Hispanic consumers as model and had assumed language being used in an advertisement to be Spanish. With the result Hispanic consumers were ad sensitive to the use of Spanish language. In other words the success of an advertisement was dependant on the usage of Spanish language for the Hispanic consumers. However if the Hispanic language was used too privately it also led to insecurity amongst the consumers. The mixed language appeals to the consumers were the most as English language was considered to be as effective sort of inferiority complex amongst Spanish.

Netter, J (1982) describes In is article titled Excessive Advertisement described that extreme advertisement reduced cost, as it provided low cost information that was widely acceptable to the masses living in this society. However other economic school of thought argued that resources allocation of a firm was being effected by totally advertisement that is considered to be useless in the view of the economist. He considered aspects like excessive competition had resulted in extreme advertisement. Therefore he looked at the relationship between profits and sales to the individual firm or as an industry as a whole. He ultimately concluded that advertisement through competition increased or decreased the sales and, if the firm had not competing edge through advertisement over other firms. Gaeth, G (1987) In his article titled Cognitive Processing of Misleading Advertisement tried to explain misleading advertisement amongst consumers belonging from old and young age group using cognitive model, than he provided a solution to this problem. The author tried to find the difference between the misleading advertisements providing true claims advertisement. He found that aged consumers had poorer memory processing as indicated by response biasness.
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However the young consumers were more prone to be encouraged by misleading advertisement claims. Ultimately he provided a solution in terms of proving training to the youth so that they were not attracted by false claims and to differentiate between right or wrong. He believed in interactive training to accomplish the young. However it was not applicable to the aged people because of their lower level of short term memory.

Stern, B (1993) examines In his article titled Feminist Literary Criticism and the Deconstruction of Ads examined consumer responses from the perspective of postmodern feminist literary era. He supported the feminist view to include the issues of advertising gendered text and consumer responses as gender in readings. The method was demonstrated in a feminist reading of two advertising figures the author used a Marlboro , a man and a Decota woman as a sample for this research. . He found out that reading style of an ad varied between male and female. The way a male might perceive or read an ad might be different as compared to a female. Female consumers might be more inclined to participate imaginatively in their lives, and male

consumers were inverse to this. Hence the author proved that the consumers from different genders perceived amd they had different preferences in life .Due to this they had different attitude towards life and as a result they read ad in different styles in accordance to their attitude.

Smith, H (1935) In his article titled Imputation of Advertising Cost describes two methods to measure the actual advertising cost. The first method was increase in value of the product through use of either persuasive or informative advertisement. This method measured the cost of advertising however it created value for the company in terms of higher price. In the second method profits were viewed as a source of success for the company without judging the real need of the society. The author also discussed the fact that advertising expenditure aimed at increasing
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sales by affecting the mind of the consumer. By various appeals it induces him to change his subjective valuation of the commodity. Thus marginal utility of the commodity s increased and the demand curve rose." The effect of price was determined by elasticity of demand. This yes obviously affected by the level of advertisement carried out on the behalf of the firm. Thus the net revenue of the firm would increase if the demand was inelastic of the commodity concerned. Author also discussed information provided by the advertisement was not always accurate hence firms were operated in an unethical manner. He also discussed the risk that producer had to face if the advertisement budget with the aim towards reaching long term goals and objectives -In short term advertisers face risk of sunk cost. The third group of difficulties that the vast bulk of advertisement was carried out through the intermediary of specialized agencies who were quite naturally interested in persuading the advertisers to spend the maximum upon advertisement. In general the entrepreneur was unable to estimate with any substantial degree of accuracy, the results derived by that advertisement. The author also believes that the role of advertisement would vary from industry to industry. In case of perfect competition high degree of advertisement would be required. On the other hand in case of imperfect competition inverse would be the situation. Therefore prices were merely a subjective matter of covering advertising cost.

Russo, E (1981) in his article titled Identifying Misleading Advertising identified procedure of identifying misleading advertising. The research primarily was used consumer belief as a means of measurement of identifying misleading advertisement. If an advertisement was misleading it held more false beliefs than a comparison group. He classified advertisement into exploitive misleading and non exploitive misleading. For exploitive misleading he identified four factors while for the later he identified ten factors. In exploitive
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fraud focused on the advertiser and

assumed a deliberate intent to create false beliefs about the product. Other factor that is falsity was when the advertiser told a lie lie about something like price. A demonstration of misleading advertisement required the observation of false consumer beliefs in combination with exposure to the ad. Consumer belief of a false claim, increased belief in a false Claim, after exposure to an advertisement, exploitive misleadingness and less misleadingly false beliefs for for corrected than for original advertisements are the criterions used for measuring degree of misleadingness. Misleadingness could be reduced by creating awareness amongst consumers or correction of misleadingness. Besides helping to avoid costly regulatory action, a pretest might reveal that the misleading claim was not essential to sell the product. One of the striking findings of this study was that the main thrust of the ads was not implemented by removal of the misleading claim.

Edell, J(1983) In his article titled The Information Processing of Pictures in Print Advertisements discusses the presence of a dominant picture in a print ad could alter a

consumer's cognitive activity while viewing the ad He used the process of viewer evaluation , encoding and storing information found in the ad as a tool to review the issue. This model was tested in a Laboratory setting. The results obtained clearly indicated that whether message was conveyed pictorially framed that was through a picture and was well designed or verbally it had a direct impact on how consumer process an advertisement considering the fact that the consumer was given opportunity to process the information that he had gathered. The author had a direct impact on consumers purchase intentions and brand awareness. Thus this research clearly indicates consumers' processing of print advertisements in a forced exposure situation related to the structure and content of the advertisement. There were no significant differences between the pictorial framed ads and the verbal ads on any of the measure taken and the advertisers should give special consideration to the fact that information is positive, The author
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also described that advertisers could mislead the consumer without putting factually in correct data into words. These results suggested that new approaches might need to be used in defining of misleading and what is not.

Armstrong. M (1979) In his article Detecting and Correcting Deceptive Advertising discusses techniques in finding out deceptive advertisement and presented a framework in correcting misleading advertisement with the help of relevant belief techniques. He used Listerine advertisement as a prototype advertisement as it was found deceptive along . He used normative belief techniques that provided similar results except for source effects over time. Normative techniques suggested that the standard against which deceptive ads can be judged the normative belief involve identifying the major attributes associated with a product class,. Both studies

suggested that the Listerine ad produced significant increases in levels of deception. Both studies indicated that corrective ads had a significant effect in reducing deception.

Nelson, P (1974) In his article titled Advertising as Information suggested

how the major

features of the behavior of advertising could be explained by advertising's information function. Advertising provided direct information about the characteristics of a brand direct and indirect.The most important information conveyed by advertising was simply the brand products. The consumer would know about that difference prior to purchase in the case of search qualities. This reduced considerably-but not entirely incentives for misleading advertising. The major power that consumers hold was whether they repeated the purchase of a brand or not. Consumer had quite incomplete information. So narrow chances of being misled exists. The eficiency of a firm in some cases might be adversely affected efforts of providing information to consumers regarding reduction in budget allocation of product and increase in advertising
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budget. This eventually affected the quality of a product or brand. The producer distributed his advertisements among media so that his message was seen by those who were most likely to repeat purchase of his brand. The author believes that deception occurs during advertisement The circumstances under which advertisers had the greatest incentives to deceive if consumers believed them were precisely the circumstances under which consumers would be least inclined to believe advertising. Thus this research concluded that such goods advertising's information was direct. For experienced goods the information conveyed was dominantly indirect. Producers of equal efficiency had a choice of making a low-utility brand at high unit profits or a high-utility brand at lower unit profits

Boyer, M (1987) discusses In this article titled Expanding the In formativeness of the Price System with Law discussed that the use of false regular prices was a major case of misleading advertisement in competitive market. So a framework explaining the rationale of misleading advertisement was constructed. The major assumption was that there is competition locally but that different qualities could exist in different markets. He also differentiated between two firms who participated in bargaining one was small sized the other one being large sized while competing with each other. All low-quality firms engaged in fraud. He assumed that there would be a penalty on both firms if a firm is involved in fraud and the results indicated that the firm involved in Freud would be profitable because advertisement of bargain sale would be positive. The role of the law was to allow the emergence of more informative prices that should be well understood by the regulatory as well as firms involved in misleading advertisement.

Liefield, J(1985) in his article titled

Reference Prices and Deception in Newspaper

Advertising analyzes the ways consumers were being deceived by the newspaper advertisement
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through regular price alone, sale price alone, regular price with Manufacturer's Suggested List Price (MSLP), sale price with regular price, or sale price with MSLP. He described that consumer perception was affected by these kinds of prices. And the consumers recent shopping experience was measured with the help of these kind of pricing strategies of newspapers considering different products like paint, jeans, gas barbeque. Misleadingness about reference price claims was described as occurring when the presence of a reference price claim in an advertisement led consumers to perceive that the ordinary price was higher than they anticipated. The results of this experiment provide clear evidence that MSLP and regular price statements did not necessarily lead consumers-with or without recent shopping experience for the products. Therefore he suggested the regulatory authorities to ban its prices misleading to consumers.

Review of literature is studied according to study topic. In this case all the reviews of literature are taken randomly taken.

Conclusion In the conclusion part I would like to say advertising is being done in spirit of ethics by some firms however on the other hand it is also being done unethically. Moreover the firms were involved in misusing the information by misleading consumers That is not being used in light of true ethical spirit. Consumers were also being exploited of high prices that they basically were the consequence of excessive advertisement that burden eventually had to be borne by them. Moreover the firms were trying to reduce their cost to minimum level hence the innocent
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consumer had to purchase substandard products in terms quality and features it has also affected the efficiency level of firms. It might inversely affect firms product standard were being used in ads. Celebrities were being used in ads that add value to the company however they basically were a tool by advertisers to increase sales. Consumers were rather forced to buy a product using irrational phenomenon of the undesirable. Advertisers should also give concentration to the language being used while advertising. The language should be easily understandable and liked by the masses. The only good role that advertising was playing in the world of today was that it informs the consumers about the availability of the product so that the consumers have wider choices and freedom to select the brand they desire. The persuasion role in most cases was unfavorable for consumers and favorable for producers.

There should be some authorities that should regulate the advertisers mislead, deception, exploiting consumers advertising and selling a product. In fact strict regulations should be implemented in favor of all the stake holders involved like consumers, employees of the firms and share holders keeping in view the rights of stakeholders.

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Sampling procedure and sample size

Keeping in view the nature and objectives of study, the primary data was required. As the features negative and creating inverse ethical thoughts among people could be identified by the population looking the advertisement our reading regarding the same or listening it thoroughly, the population specifically having dealing with consumer products at household level would be more cautious to answer the required questions.

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Being a student having less financial resources for research, I had confined my research to D.H.A Lahore. The method I would be using to collect primary data would be basically questionnaire. General consumers would be asked through questionnaires whether

advertisement/marketing ethics are being followed within packed milk industry. There response would be of ultimate importance to us as we would be able to get the feedback of the general public about our topic of research in Lahore.

Theoretical Framework
Theoretical frame work was chalked by considering variables independent variables. The key variable that I have identified are factors like Language, Role of celebrities, Values and perception of consumers towards a brand, attitude of consumers and the effects of externalities on ethical advertisement.
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Results of the study

In the study the impact of the factors affecting ethical advertisement was examined. At the first level the basic characteristics of the respondents would be asses the representative sample of the sample population, from where this sample respondents were selected. Moreover the basic characteristics of the sample respondents gave the idea regarding comprehension of the respondents about the concerned indicators that might that might lead to ethical aspects of advertisement.
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Classification of family members The essentiality of the members of the family by several propositions might be justified to know availability statues of male labor force. This would lead towards consumption pattern and expenditure as well as the income earning pattern Occupational analysis of the family members will be classified on the basis of occupation or the title of work occupation

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Fig 1.1: Responses of perception of ethical advertisement from the respondents

Ethical Yes No

Percent 66.7 16.7

In response to this question 66.7 % consumers replied that advertisement is ethical while the rest believed that its unethical. That clearly is a huge majority in favor of ethical advertisement.

The reasonn why the consumer came to this belief was due to this reason that most of the firms are following ethics while advertsing their milk products.

I.

Competitive price has no significant effect on ethical advertisement

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Competitive Price has significant effect on ethical advertisement Fig 1.2: Responses of milk aspects affected by competition from the respondents

Competition effect Quality Price Advertisement Total

Percent 30.0 43.3 26.7 100.0

42.3 % consumers believed that price is the most important aspect that is effected by competition. While the rest 30 % believed in quality and 26.7 % believed in advertisement of the packed milk as the most important factor.

The main reason why the consumers came to this belief was attributed to the fact that within packed milk industry there is intense competition as a wide range of brands are operating in the market so price was the major factor affected by competition so there is a significant relationship between price and ethics.
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I.

Television as an accurate source of information has not a significant impact on ethical advertisement.

Television as accurate source of information has a significant impact on ethical advertisement. Fig 1.3: Responses of accurate information providing mediums from the respondents
Medium of advertisement Television Radio newspaper Billboard Magazines Total

Percent 66.7 6.7 3.3 10.0 13.3 100.0

Television was conceived to be the most important accurate information provider followed by magazines, billboards, radio and newspaper.

Respondents viewed Television as the most accurate information provider. As they felt television as a source of information provider is not deceiving nor does it mislead. So a

36

significant relationship exists between advertising ethics and Television as a source of accurate information provider. I. Use of Urdu Language has not a significant impact on ethical advertisement

Use of Urdu Language has a significant impact on ethical advertisement.

Fig 1.4: Responses of language preferences in advertisement from the respondents

Language preferred English Urdu Mixture of English and Urdu Total

Percent 23.3 46.7 30.0 100.0

Urdu language was perceived to be the preferred language as compared to English or Mixture of Urdu and English.

37

There is a significant relationship between use of Urdu language in an advertisement and advertisement ethics. As Urdu is our national language and was felt to be easily understood by all the consumers belonging from all the region and ethnicity.
I.

There exists no significant relationship between water pollution and ethics There exist significant relationship between water pollution and ethics

Fig 1.5: Responses of negative environmental effects from the respondents

Noise pollution Air pollution Water pollution Total

Percent 26.7 23.3 50.0 100.0

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There is an insignificant relationship between milk advertisement and water pollution. This is due to the fact that the milk producer trashes the waste material in rivers, lakes and the sea. Water pollution causes an external cost to the society therefore it was not considered ethical.

Fig 1.6: Responses of male members in a family from the respondents

Number of male in family

Percent

1 2 3 4 5 Total

26.7 20.0 23.3 26.7 3.3 100.0

A variation in these results was found as some families had 1 male member, 2,3,4,5 or 6.

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Fig 1.7: Responses of female member in a family from the respondents

Number females family 1 2 3 4

of in Percent 23.3 56.7 16.7 3.3 100.0

Total

The results for the number of female members were mainly 2 female members in a family having a percentage of 56.7 %, followed by 1, 3 and 4.

Fig 1.8: Responses of earning hands in a family from the respondents

Number of earning hands in family 1 2 3 4 Total

Percent 46.7 36.7 6.7 10.0 100.0

40

The response was mainly in favor of 1 or 2 earning hands in the family having a percentage of 46.7% and 36.7 % respectively

Fig 1.9: Responses of occupation from the respondents

Occupation Business men house wife Student Employee Total

Percent 30.0 40.0 16.7 13.3 100.0

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As far as the occupation of the respondents was concerned 30 % were business men, 40 % were housewives, 17 % were females and the rest 13% were employees of a company. An important point to notice here is that housewives are heavy purchasers of milk as mentioned before as compared to people from other occupation.

Fig 1.10: Responses of monthly income in a family from the respondents

Monthly income 5000 10000 15000 20000 25000 and above Total

Percent 10.0 6.7 16.7 26.7 40.0 100.0

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The income bracket in which our respondents fell in was monthly household income of 25000 Rupees or more. This is again due to the fact that majority of our respondents were business men, housewives or employees so at an average they earn this much income

Fig 1.11: Responses of ethics definition from the respondents

Definition of ethics Consumers are not deceived No misleading claims are used Consumer exploited are not

Percent 36.7 33.3 13.3 16.7 100.0

Advertisement within social and cultural boundaries Total

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37 % believed that in ethical advertisement consumers are not deceived, whereas 33% replied no misleading claims are used. 17% said it should be under social and cultural boundaries and the rest 13 % said consumers are not exploited. Through this analysis we define ethical advertisements as one in which no misleading claims are used and consumers should not be deceived according to majority of respondents definition.

Fig 1.12: Responses of negative effects of advertisement from the respondents

Negative effects of advertisements Mislead consumers Deceive consumers Exploit consumers Promote vulgarity Total

Percent 33.3 46.7 10.0 10.0 100.0

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The results indicated that majority of respondents perceived advertisement to be deceiving having a percentage of 47 %. 33% of them thought it to be misleading as it is argued by them incorrect information is given sometimes about the product whereas 10 % believed that it promote vulgarity and exploit consumers.

Fig 1.13: Responses of advertisement positive role from the respondents

Positive role of advertisement Create awareness Remind Persuade Entertain Total

Percent 50.0 13.3 26.7 10.0 100.0

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Whereas in the later question majority of respondents about 50 % of them responded that it creates awareness about the product availability. This clearly signifies that according to our respondents of milk advertisement awareness role of advertisement is given preference over others as they believed that milk advertisements of clearly gives information about the product availability and hence awareness is created.

Fig 1.14: Responses of regulatory role from the respondents

Yes No 33.3 50.0

46

According to my responses of this questions majority of respondents believed that there was existence of no or very few advertising regulatory bodies so 50 % of them believed that regulatory are not playing there part. So in accordance to the consumers if there is a presence of a body that regulates advertisement than it can be made more ethical and this is where the ultimate solution of this problem lies.

47

Conclusion

48

In the conclusion part I would like to say for the purpose of my research I kept some research objective and on the basis of this objective I made some hypothesis. These hypotheses were tested with the help of consumers questionnaires and the results were analyzed using frequencies. I was able to come at the conclusion through this that the advertisement being carried out in milk advertisement is ethical. As factors like competitive pricing, accurate information provision and Use of Urdu language has a significant relationship with ethical advertisement. However water pollution proved to have insignificant relationship with this is due to the fact that there are other factors that can effect ethical advertisement

49

Recommendations
Therefore it is the need of time that the regulatory should play active part in controlling problems like water pollution so that ethics are followed in true sense and there is assurance social and cultural values being followed in the society. that the

50

Appendix
Related definitions Independent Variables Ethics: that branch of philosophy dealing with values relating to human conduct, with respect to the rightness and wrongness of certain actions and to the goodness and badness of the motives. www.dictionary.com Ethics of advertising intends to ensure that advertisers and consumers co-exist without being harmed by the messages of advertisements. www.academon.com Business Ethics Is the study and examination of moral and social responsibility in relation to business practices and decision-making in a business www.dictionary.com

Dependant and intervening Variables Memory: The mental capacity or faculty of retaining and reviving facts, events, impressions, etc., or of recalling or recognizing previous experiences. www.dictionary.com Age: A period of human life, measured by years from birth, usually marked by a certain stage or degree of mental or physical development and involving legal responsibility and capacity.www.dictionary.com Training: To coach in or accustom to a mode of behavior or performance. www.dictionary.com

51

Psychographics: the use of demographics to determine the attitudes and tastes of a particular segment of a population. www.dictionary.com Lifestyle: the habits, attitudes, tastes, moral standards, economic level, etc., that together constitute the mode of living of an individual or group of consumers. www.dictionary.com Values: The beliefs of consumers in a society. www.dictionary.com Behavior: the action or reaction of consumers under given circumstances. www.dictionary.com Attitude: manner, disposition, feeling, position, etc., of consumers with regard to a person or thing. www.dictionary.com

Language: a body of words and the systems for their use common to a people who are of the same community or nation, the same geographical area, or the same cultural tradition. www.dictionary.com Ethnicity: being a member of an ethnic group, esp. of a group that is a minority within a larger society. www.dictionary.com Perception: the act or faculty of apprehending by means of the senses or of the mind; cognition; understanding by consumers. www.dictionary.com Response: an answer or reply, as in words or in some action. www.dictionary.com

52

Attractiveness: arousing interest of consumers or engaging one's thought, consideration, etc.: www.dictionary.com Celebrity: A renowned figure. www.dictionary.com Recall: to bring back from memory; recollect; remember. www.dictionary.com Attention: the act or faculty of attending, esp. by directing the mind to an

object.www.dictionary.com Attitude: Manner, disposition, feeling, position, etc., of consumers with regard to a person or thing. Arousing interest or engaging one's thought, consideration, etc.: www.dictionary.com Sales: The exchange of goods or services for an amount of money or its equivalent; the act of selling. www.dictionary.com Misleading advertisement: If the organizations who take the lead on regulating advertising are unable to deal effectively with advertising. www.dictionary.com Deceive: The act of misguidance by an organization. www.dictionary.com Techniques: The systematic procedure by which a complex or scientific task is accomplished. www.dictionary.com Normative: Techniques regarded as the standard of correctness in behavior, speech, writing, etc. www.dictionary.com Time effect: Impact on goods and services due to time constraints. www.dictionary.com

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Excessive advertisement: Going beyond the usual, necessary, or proper limit or degree in advertisement. www.dictionary.com Resource allocation: Division of resources in the most efficient manner by companies. www.dictionary.com External cost: an external effect, often unforeseen or unintended, accompanying a process or activity by the organization to the third party. www.dictionary.com Religion: a specific fundamental set of beliefs and practices generally agreed upon by a number of persons or sects. www.dictionary.com Belief: The mental act, condition, or habit of placing trust, faith or confidence in another. www.dictionary.com Value: the ideals, customs, institutions, etc., of a society toward which the people of the group have an affective regard. www.dictionary.com Belief: an answer or reply, as in words or in some action. Gender: The condition of being female or male; sex. www.dictionary.com Taste: the sense of what is fitting, harmonious, or beautiful; the perception and enjoyment of what constitutes excellence in the fine arts, literature, fashion, etc. www.dictionary.com Response: an answer or reply, as in words or in some action by consumer. www.dictionary.com

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Employment: an occupation by which a person earns a living; work; business. www.dictionary.com Discrimination: treatment or consideration of, or making a distinction in favor of or against, a person or thing based on the group, class, or category to which that person or thing belongs rather than on individual merit. www.dictionary.com Gender: The condition of being female or male; sex. www.dictionary.com EEO: The agency of the Government that enforces the federal employment discrimination laws. www.dictionary.com Competition is the rivalry of two or more parties over something. www.dictionary.com Market orientation: provides a company with a better understanding of its customers,

competitors, and environment. www.dictionary.com Price: the sum or amount of money or its equivalent for which anything is bought.www.dictionary.com Quality: an essential or distinctive characteristic, property, or attribute of a product. www.dictionary.com Social responsibility: The principle that companies should contribute to the welfare of society and not be solely devoted to maximizing profits. www.dictionary.com Law: the principles and regulations established in a community by some authority and applicable to its people and organizations. www.dictionary.com
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Behavior:

the

action

or

reaction

of

any

consumer

under

given

circumstances.

www.dictionary.com Credibility: The quality, capability, or power to elicit belief of consumers. www.dictionary.com Trust: confident expectation of something from consumers. www.dictionary.com Believability: to have confidence in the truth, the existence, or the reliability of product. www.dictionary.com Price deception: Misguiding about price. www.dictionary.com Externalities: An incidental condition that may affect a course of action of a business. www.dictionary.com Conflicts: A state of disharmony between incompatible or antithetical persons, ideas, or interests; a clash. www.dictionary.com Behavior: the action or reaction of any consumers under given circumstances.

www.dictionary.com Regulations: Set of laws set by the authorities. Self interest: consideration only for one's own aims and objectives. www.dictionary.com Management: the person or persons controlling and directing the affairs of a business, institution. www.dictionary.com

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Accountability: the state of being accountable, liable, or answerable to management of a firm. www.dictionary.com Performance: the manner in which or the efficiency with which something reacts or fulfills its intended purpose within organization www.dictionary.com Standard: an average or normal requirement, quality, quantity, level, grade, etc set by a company www.dictionary.com Motivation: the psychological feature that arouses an organism to action toward a desired goal; the reason for the action; that which gives purpose and direction to behavior. www.dictionary.com Quality Standards: It is a generally accepted standard of quality. www.dictionary.com Regulations: Set of laws set by the authorities. ISO: The body governing the quality standard. Brand loyalty; in marketing, it consists of a consumer's commitment to buy a product. www.dictionary.com

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Business Values

Behavio

Motivation
EEO

Regulations
Price deceptio n Believability

Brand loyalty

Law

Accountabil ity Performance Gender

Social
Quality

Self Interest Behavio r Conflicts

Standards Manageme nt

PriceInte Self Market Orientati on

Competit ion Gender Tast e

Discriminatio n

Trust

ISO

Employment

Externalities Credibil ity Quality standards Laws

Respons e

Factor affecting ethical advertisement and business values

Attitude Respon se

Sales

Brand loyalty

Time effects

Belief Behavior

Trainin g External Age

Brand Attitude Market segments Normativ e technique Demographic

Response

Belief

Attentio n

Value Perception

Memory

Cos

Recall

Values Lifestyle Ethnicity

Informat ion

Celebri ty

Resource allocation Psychograp hics

Attractive ness

Mislea d

Langua ge

Religion

Excessiv e Ads

Ethical Advertisement

References
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Koslow, S ((Mar, 1994), Exploring Language Effects in Ethnic Advertising: A Sociolinguistic Perspective, the Journal of Consumer Research, Vol. 20, No. 4. pp. 575-585. B. Stern (Mar., 1993), Feminist Literary Criticism and the Deconstruction of Ads: A Postmodern View of Advertising and Consumer Responses, The Journal of Consumer Research, Vol. 19, No. 4. pp. 556-566. Kahle , R (1985) Physical attractiveness of celebrities, The Journal of Consumer Research, Vol. 13, No. 3.), pp. 405-409. Gardner, P (1983) advertising effects on attributes recalled The Journal of Consumer Research, Vol. 11, No. 4. pp. 954-961. Murray (1986) integrating management and marketing theory Gatewood, R (1991) assessment of ethical performance , The Academy of Management Review, Vol. 16, No. 4. pp. 667-690. Netter, J (1982) excessive advertisement ,The Journal of Industrial Economics, Vol. 30, No. 4. pp. 361-373. Gaeth, G (1987) cognitive processing of misleading advertisement, The Journal of Consumer Research, Vol. 14, No. 1.), pp. 43-54. Smith, H (1935) imputation of advertising cost, The Economic Journal, Vol. 45, No. 180. pp. 682-699. Russo, E (1981) Identifying Misleading Advertising, The Journal of Consumer Research, Vol. 8, No. 2. pp. 119-131. Edell, J (1983) The Information Processing of Pictures in Print Advertisements , The Journal of Consumer Research, Vol. 10, No. 1. pp. 45-61 Armstrong, M. (1979) Detecting and Correcting Deceptive Advertising, The Journal of Consumer Research, Vol. 6, No. 3. pp. 237-246. Nelson, P (1974) Advertising as Information The Journal of Political Economy, Vol. 82, No. 4.pp. 729-754. Boyer , M (1987) Expanding the In formativeness of the Price System with Law, The Canadian Journal of Economics / Revue canadienne d'Economique, Vol. 22, No. 2., pp. 217227.

59

Liefield, J (1985) Reference Prices and Deception in Newspaper Advertising The Journal of Consumer Research, Vol. 11, No. 4. pp. 868-87

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Consumer Questionnaire
Name________________________________________ Age ________________________ Address______________________________________
1. Number of family members in family_________ 2. Number of males in family__________________ 3. Number of female in family__________________ 4. Number of earning hands in family_____________ 5. Monthly income_____________________________

6. Gender o Male o Female

7. Marital status o Married o Unmarried

8. Occupation o Businessmen o Housewife o Student

61

o Employee o Others_______________

9. Education o Matriculate o Under matriculate o Under graduate o Graduate o Doctorate

o

Others please specify___________

10. Preference of milk

o

Unbranded---------------------------

o Branded-----------------------

11. Reasons for preference o Taste o Quality o Hygiene

o

Others please specify ______________________

62

12. Do you look for brand name before buying milk? o Yes o No o Neutral

13. What is your favorite brand of milk? o Nestle o Haleeb o Halla

o

Others please specify ______________

o None

14. What is your consumption pattern of milk? o 1/8 kg per day o kg per day o kg per day o 1 kg per day
o

Others please specify ___________

15. Which feature of milk do you think are the most important? o Quality o Price o Quantity o Hygiene

63

o Purity o Taste
o Others please specify ______________

16. In your opinion what aspect of milk has been effected by competition o Quality o Price o Advertisement o Quantity
o

Others please specify ____________

17. What role does advertisement play in the world of today? o Inform o Persuade o Remind o Entertain
o

Others please specify _______________

18. Advertisement of which brand of milk you prefer? o Olpers o Nestle o Haleeb

64

o Halla o Goodmilk
o

Others please specify ____________

19. What are the reasons for your preference of the advertisement for the brand of milk you have selected? o Brand name/image o Repetition of ad o Entertainment
o

Others please specify ______________

20. Has advertisement influenced your belief and perception about the brand you have selected? o Yes o No o Neutral

21. Which medium of advertisement do you think gives most accurate information? o TV o Radio o Magazine o Billboard o Magazine
o

Others please specify _____________

65

o None

22. In which language do you like to see milk advertisements? o English o Urdu o Mixture of English and Urdu
o

Other please specify ______________

23. Do you think the language/tone of an ad inspires you to buy milk? o Yes o No o Neutral

24. Has presence of a celebrity in an ad influenced you to buy milk? o Yes o No o Neutral

25. Do you look for product attributes like patent s and trademarks before buying milk? o Yes o No o Neutral

66

26. What negative effects have firms have caused to the environment within the packaged milk industry? o Noise pollution o Air pollution o Water pollution
o

Others please specify -----------------------

27. What positive role does milk advertisement play nowadays? o Creates awareness o Remind o Persuade o Entertain
o

Others please specify ________________

28. What negative effects have these advertisement caused?

o Mislead o Deceive o Exploit

o

Others please specify ______________

29. Do you think that milk advertisements today ethical?

o Yes
67

o No o Neutral

30. Do you think the regulatory are playing the role they are expected to play in advertisement? o Yes o No o Neutral

31. How do you define advertisement? o Does not deceive consumers o Does not use misleading claims o Does not exploit consumers o Advertisement that is socially and culturally acceptable

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69