The Political Legal Environment
The political and legal environment in a country is one of the most important factors influencing the advertising and promotional programs of international marketers. Regulations differ owing to economic and national sovereignty considerations, nationalistic and cultural factors, and the goal of protecting consumers not only from false or misleading advertising but, in some cases, from advertising in general. It is difficult to generalize about advertising regulation at the international level, since some countries are increasing government control of advertising while others are decreasing it. Government regulations and restrictions can affect various aspects of a company's advertising program, including:
• The types of products that may be advertised.
• The content or creative approach that may be used.
• The media that all advertisers (or different classes of advertisers) are permitted to employ.
• The amount of advertising a single advertiser may use in total or in a specific medium.
• The use of foreign languages in ads.
• The use of advertising material prepared outside the country.
• The use of local versus international advertising agencies.
• The specific taxes that may be levied against advertising.36
A number of countries ban or restrict the advertising of various products. Cigarette advertising is banned in some or all media in numerous countries besides the United States, including Argentina, Canada, France, Italy, Norway, Sweden, and Switzerland. The Australian government limits tobacco advertising to point of purchase. The ban also excludes tobacco companies from sponsoring sporting events. In Malaysia, a government ban on cigarette-related advertising and sponsorship was initiated in 2003 in an effort to curb the rising number of smokers in the country.37 In China, tobacco and liquor advertising are banned except in hotels for foreigners.
Recently the tobacco industry has been reducing its advertising efforts in markets around the world, including Asia and Eastern Europe, where they have enjoyed much more regulatory freedom. Three of the largest tobacco companies are leading an effort to implement self-imposed restrictions and requirements for their advertising.38 For example, the tobacco industry agreed to stop all television advertising in Mexico at the end of 2002 as part of a raft of new self-regulatory measures.39 Many of these restrictions are already being forced on the companies in North America, Western Europe, and North Asia, where governments take a tough stance on tobacco advertising. However, regulations in many other countries, such as Indonesia and the Philippines, are minimal. The industry's self-regulatory efforts are seen as a move to head off a campaign by the World Health Organization for a worldwide ban on all tobacco advertising.
In Europe there has been a longstanding ban on advertising for prescription-drug products, which is designed to keep government-subsidized health care costs under control. The European Union has argued that advertising increases the marketing budgets of drug companies and results in higher prices. The ban prevents prescription-drug companies from mentioning their products even on their websites or in brochures, although some relaxation of these restrictions is being considered by the European Commission for drugs used to treat AIDS, diabetes, and respiratory ailments.40
While international marketers are accustomed to restrictions on the advertising of cigarettes, liquor, and pharmaceuticals, they are often surprised by restrictions on other products or services. For example, margarine cannot be advertised in France, nor can restaurant chains. For many years, the French government restricted travel advertising because it encourages the French to spend their francs outside the country.41
Many countries restrict the media advertisers can use. In 1999 the European Commission threw out an appeal against Greece's national ban on toy advertising on daytime television. Thus advertisers can advertise toys on TV only during the evening hours.42 Some of the most stringent advertising regulations in the world are found in Scandinavian countries. Commercial TV advertising did not begin in Sweden until 1992, and both Sweden and Denmark limit the amount of time available for commercials. Advertising aimed at young children has not been legal in Sweden since commercial television was introduced in the country a decade ago. The Swedish government feels that young people are not able to differentiate between advertising and programming and are not capable of understanding the selling intent of commercials.43 Saudi Arabia opened its national TV system to commercial advertising in 1986, but advertising is not permitted on the state-run radio system. Advertising in magazines and newspapers in the country is subject to government and religious restrictions.44
Many governments have rules and regulations that affect the advertising message. For example, comparative advertising is legal and widely used in the United States and Canada but is illegal in some countries such as Korea and Belgium. In Europe, the European Commission has developed a directive to standardize the basic form and content of comparative advertising and develop a uniform policy.45 Currently, comparative advertising is legal in many European countries, illegal in some, and legal and rarely used in others such as Great Britain. Many Asian and South American countries
Continue reading here: Advantages of Global Marketing and Advertising
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