Marketing & Innovation

Should we replace replace traditional advertising with ethical advertising?

Ethical advertising: does it appeal to you? I recently stumbled upon a press release from an English Adtech company IOTEC [which calls itself an ethical media buying platform] and I could not believe what I saw. It is rare that I set my sights on CP but this one was very original and unexpected, and the timing was perfect too. This IOTEC announcement advocated the use of ethical advertising by providing tips that I’ll quote below, making them simpler: ceasing psychological targeting, avoiding pop-ups and intrusive ads, and checking the display announcements. In this piece, I have investigated the matter to find the truth about advertising and transparency.

Ethical Advertising
Should we do away with classic advertising and move to ethical advertising: not so fast … take some time to look at the numbers

“Trust in advertising has never been so low” – true or false?

The reason given by IOTEC is that “trust in advertising [has] never been so low”. I’m not a big fan of advertising even though I wouldn’t go as far as Doc Searls calling it the “cancer of the Internet“. It is true that I am more of the opinion that word-of-mouth marketing is the future of Web marketing as much as it was its beginning. Besides, social media gave prominence to word-of-mouth marketing. Hence, my point.

But the fact that I [or IOTEC] am convinced that a concept is right, moral and respectful, does not mean that it is true. And even so, one could imagine that consumers – who are not always consistent – think something and do otherwise. Or they may hate advertising but are nevertheless influenced by it.
Even more, consumers could put trust in the ads they like, and they shun the ads they dislike. Perhaps also marketers, who are self-obsessed, see the need to attribute a moral value to their advertising (“trust” is a pretty strong term).

Is an ethical advertising approach demanded by consumers?

For example, I can be completely aware of the manipulative – even deceptive – nature of an advertisement for a computer that roaringly proclaims (one with an apple on its cover for example) that it is more powerful than the others (with another logo and another OS), even though when we look at the numbers, this claim is all but true. And yet they might let themselves be convinced by advertising for other reasons (aesthetics, status offered by the product at a premium price, quality of construction, possibility of resale, …).

After all, it may well be that the consumer, who is quite educated, knows perfectly how to decode the manipulative aspect of an advertisement and that he lends himself to the exercise nevertheless, by game or by pleasure.
Finally, if it turns out that advertising is a victim of disenchantment, and that the appetite for ethical advertising could be justified and that all this is perfectly logical, are these facts sufficient for advertisers to act likewise and for consumers to ask for these changes?

Last but not least, can the recent cases of data theft and the more or less questionable behaviour of certain major players of the Internet, depending on the interpretation, be a trigger for a change?

So, let’s take some time to think about these points, ask some basic questions and try to find answers based on facts, figures and studies.

Ethical Advertising: Facts and Figures

I wanted to substantiate the public’s perception of advertising and the public’s appetite for ethical advertising if it exists (for that I refer you to IOTEC’s press release below). I asked myself a number of questions:

  1. First, is there a loss of confidence in advertising and what does it mean? Is it new? And, is this true for all countries?
  2. Second, are advertisers aware of this problem– if it exists – and what are they planning to do about it?

Finally, I will come back to the basic principles of ethical advertising, once again using the press release of IOTEC.

Point 1: Is the mistrust of advertising real or not?

According to Digiday, Brits (about 70%)- with differences in views between Londoners and the rest of the UK- are more sceptical towards online ads than Americans (58%), French (54%) and other Europeans. However, Nielson’s report has some different findings: In France, consumers are more defiant.

“Compared to the results of 2013, consumer confidence has fallen on the recommendations of loved ones and the opinions of other online consumers. Topics such as fraudulent practices (a public broadcast recently made the buzz by creating a fictional restaurant and false opinions) are frequently discussed on media, which undoubtedly reinforce the well-known scepticism of the French.

Conversely, the other formats are progressing, whether on traditional media (television, radio, press) or digital media (banners, social networks)”, says Anne-Valérie Nierlich, a media expert at Nielsen.

The discrepancy is perhaps due to the errors in the representativeness of the sample. But, there are variations.

Ethical Advertising
Source: Statista

But, that’s not what we hear everywhere (the banners do not work, the ad on TV is over …)? Good! It was so in 2015, but after the famous Forrester report on “the end of advertising as we know it“, are there other studies that could shed light on topics not covered in this report?

Ethical AdvertisingThe 2017 study showing consumers’ desire for transparencywas led by two professors, Kent Grayson (right) from Northwestern University and Matthew Isaac from Seattle University, who showed that consumers would have more confidence in advertising than one might think. This study was relayed by Social Media Week.

In essence, the study and analysis of social media week show that consumers (or interviewees rather, I’ll come back to this in a moment) are less defiant vis-à-vis advertising – or rather some forms of advertising – which impugns the common perception. But they are, above all, more educated than in the past and they can’t be fooled.

“For all the effort marketers are putting into making their ads look like anything but ads, perhaps the real opportunity lies in owning their truths and creating valuable, straightforward advertising experiences that are built on a promise of full transparency.” [source: Social Media Week]

Ethical advertising scores one point with this. In other words, what matters most is with that trust in advertising has been eroded, the truth is that certain tactics perceived as being just and direct by consumers make transparent advertising (and thus ethical advertising) not only relevant but also more effective.

What is advertising anyway?

It seems that the meaning is very broad, and the interpretations are many.
“Certain tactics, such as offering to match a competitor’s low prices, reporting a high rating on a site like Amazon or Yelp or mentioning a recent ranking by a third-party source like U.S. News & World Report, received the most positive reactions from participants. Others, like using paid actors instead of real people, or even hiring celebrity endorsers to express their affinity for a product, came off as “deceptive” or “manipulative,” according to those surveyed.” [source: New York Times]

In conclusion, the answer to my question is “neither yes nor no”. It would be wrong to infer from these studies and figures that advertising as a whole is rejected by the public. On the contrary, it should be understood that specifically the manipulative tactics of marketing, or those that are perceived as such by consumers, instigate their mistrust. The good old tactics of the opinion leader do not belong to this category. Hence, ethical advertising has every chance: it is an arsenal for the future because it corresponds to real demand – a priori – of the market.

Insights from the survey methodology and countries surveyed 

These are interesting insights but need to be modified, however, according to the survey methodology used by the two academicians. The survey is indeed centred around America and includes only 400 respondents (a margin of error of 5% acceptable for the US, provided of course that the sample is representative).

“The researchers surveyed 400 people and asked them to give their opinion on a number of tactics used in TV and digital advertising. The results showed that respondents favoured 13 of the 20 tactics studied [note: we can ask ourselves whether these 20 tactics cover the spectrum, but also the level of understanding of consumers who expressed their opinion about the mechanics of these tactics].” [Source: Social Media Week].

Here is our answer to the first question. What about the second one? Have advertisers changed their habits?

Point 2: Were advertisers aware of the problem and what were their reactions?

To begin with, some reactions did make an impact, especially that of P&G in 2017, which involved reducing the online advertising investments of the company by $140 million. It is quite normal that the impact was big, and P&G has always been the spearheads of advertising and the first to bring in trends. Worse still for the marketing community, the reports revealed that the impact of this measure had been nil.

But it does not take into consideration Byron Sharp’s studies on advertising that show that the impact of a budget-cut on advertising is measured only 3 years after the interruption of the investment, regardless of the size of the business.

On the other hand, how significant are 140 million dollars for P&G in terms of advertising budget? 2% of the total, which is not negligible. But, the decline in the total advertising budget of the company between 2013 – the most important year of the period studied – and last year is $1.070 billion or 13% of this peak spending. This could mean disengagement from advertising by P&G or it could mean that its revenues are dwindling down too.

Ethical Advertising
P&G advertising budgets worldwide. Source: Statista

And bingo! When we look at the sales of the American giant, we find a curve correlated with the curve of advertising budgets. This probably allows – without going further or studying the cause-and-effect relationships beyond these correlations – to introduce a little nuance in the evaluation of results.

It’s impossible to compare everything without spending hours, but a brief look at Nestlé’s 2015-2016 spending on advertising shows a rise from $ 4.2 billion to $ 9.2 billion (worldwide).

Can ethics mend advertising?

As a conclusion to this non-comprehensive study, we can now get back to IOTEC’s analysis and check that ethical advertising matches a real demand. Advertising is not that monster to shoot down that it is portrayed so often, but it is certainly a sick beast to whom a little ethics would do good.

IOTEC’s advice to the Adtech sector

Excerpt from IOTEC CP from July 2018

Stop the psychological targeting 
Targeted advertising should always be broad and never on a personal level unless explicit consent is obtained. There are quite a few targeting tactics that exist, but one of the most ill-suited ones is psychological targeting. By tracking their results and looking at the audiences on a mass scale, it is possible to determine how to customize the content for each consumer.
Brands need to think about consumers by choosing ethical strategies and focusing on delivering the best customer experience. What about a shop that would follow a visitor for 30 days after he has visited it, trying to sell him the product? The key is to create a good customer experience, a positive feeling and trust in your brand. 

Avoid intrusive pop-ups
Intrusive pop-ups should not be allowed under any circumstances; some web publishers use and abuse the stuff. According to Digiday, 88% of Brits find online ads disruptive, as compared to 73% of French and 82% of Americans.
Bad practices must be denounced to ensure real change and restore consumer confidence.
Most consumers do not understand how they are targeted, so they turn more and more to adblockers to prevent any kind of advertising. The recent scandal around the personal data of consumers in which Facebook was involved with Cambridge Analytica, lays the ground for the contempt shown by the consumers, who are beginning to discover the lack of transparency they have about how their data is used.
No wonder the trust in advertising has never been so low, but it’s high time we do something to change this perception.

Check the display of ads
Real-time solutions exist, whereby an ad is placed next to relevant and pertinent content (content whose quality is considered acceptable by the brand). Most ad buying platforms come with their own ad-blocking filters to filter out unsuitable content, with some even adding third-party filters to that.
Brands can indicate the list of sites to which they are associated and also demand transparency from their partners on how they use the data.
In future, blockchain could be a powerful solution to offer brands full transparency on their programmatic media buying transactions. But for now, this technology is simply not ready. Today, there are scalable solutions ready to be marketed. All that brands need is the access to data surrounding their media purchases and a location to store them. All key players in the sector exploit the data they are able to retrieve from their suppliers. If suppliers are reliable, they should be able to provide it to them.

Yann Gourvennec
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Yann Gourvennec

Yann Gourvennec created in 1996. He is a speaker and author of 6 books. In 2014 he went from intrapreneur to entrepreneur, when he created his digital marketing agency. ———————————————————— Yann Gourvennec a créé en 1996. Il est conférencier et auteur de 6 livres. En 2014, il est passé d'intrapreneur à entrepreneur en créant son agence de marketing numérique. More »
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