Wednesday, November 25, 2015

How Kingfisher found a way around advertising norms in India to promote new beer

The Kingfisher Ultra Max radio ad case reveals the loopholes in the Indian surrogate advertising norms, lack of pre-screening for radio ads.
  • Representational image
Kingfisher until recently had an advertisement running on private radio channels, promoting its newly launched strong beer, Kingfisher Ultra Max. The new 'strong beer' variant from the Kingfisher stable has been brought on to compete with SAB Miller and AB Inbev that already have expensive versions of strong beer, which is the most popular variant among Indian beer consumers. 
In the radio ad, the company went ahead with using the word 'beer' several times, only 'beeping' out the word 'beer' in the name of censoring. While the word was beeped out, the Kingfisher ad also contained several suggestive descriptions for the product -- calling it a perfect blend, perfect for a road trip with friends, or a weekend getaway, each time beeping the word 'beer'. It also didn't mention the product they are actually promoting through the ad, like mineral water, music, cassettes and CDs, soda, in the radio ad. 
All these are clear violations of the surrogate advertising norm in India, which prohibits an alcohol and tobacco brand from directly advertising its products. Under surrogate advertising though, it can promote its brand with the help of alternate products or brand extensions -- Cassettes and CDs, music, mineral water, sodas, events and sports franchises. 
Some recent examples of the surrogate advertising on air recently are Smirnoff's brand extension 'Smirnoff Experience', which organises events and concerts; Johnnie Walker and Jack Daniels have created surrogate extensions by identifying and awarding achievers in various fields. Blenders' Pride also created an event company for the purpose of brand extension through the Blenders Pride Fashion Tour 2015. Another brand under United Spirits, Royal Challenge, has a sports drink, while Seagrams 100 Pipers brand has tied up with NGOs to honour philanthropy under the 'Be remembered for good' campaign.
Kingfisher, on the other hand, with the Ultra Max beer radio ad, decided to go right out and flout the surrogate advertising rules.
It was not long before many on social media took notice of this and commented. 
The ad was taken down about two weeks back, according to Kingfisher's public relations team. When we asked Samar Singh Shekhawat, Senior Vice President, United Breweries why the ad was taken down, he said that the "radio spot ran its course as planned".
He said that while creating an advertising campaign, "We look at getting the attention of consumers first and then delivering a message. In this case, since Ultra MAX is a new brand, we needed to create awareness and trigger curiosity about the product. From the store uplift that we are seeing, we seem to have created the desired impact.
The CEO of a private radio station on the condition of anonymity, however, said that the brand was advertising about an event called ‘Kingfisher Ultra Max Dart Nights’. However, the ad spot had no mention of the name of the event at all. 
ASCI acts on complaints
The Advertising Standards Council of India (ASCI) has guidelines for the qualification of brand extensions of products or services. The first point on their website says that the product or service should be registered with an appropriate government authority eg Central Value Added Tax (CENVAT)/ Value Added Tax (VAT)/ Food and Drug Administration (FDA)/ Food and Safety Standards Authority of India (FSSAI)/ Trade Marks Registry (TM). It also states that the availability of the surrogate product in the market must be at least 10% of the leading brand's market share as measured in metro cities where the product is being advertised. 
The sales turnover of the product or service should exceed Rs 5 crore per annum pan-India or Rs 1 crore per annum per state where the distribution has been established. In addition, it needs a valid certificate from an independent organisation such as AC Nielsen or a category-specific industry association before advertising.  
However, the ASCI is a self-regulating body for advertising and only has the power to pull up an advertiser for any violations if it receives a complaint from the public. Speaking on this, Shweta Purandare, Secretary General, ASCI said, “We are a self-regulatory body and do not look into pre-approval of ads. People approach us with complaints, and we distinguish if they are violating any rules or not. ASCI has (a) very clear guideline for brands to advertise. 
“There are certain guidelines for TV which requires the Information & Broadcast (I&B) Ministry and Central Board of Film Certification (CBFC) approvals. If any brand is still not adhering to the regulations, we forward it to the I&B Ministry.” 
She further added that it was difficult to comment on the Kingfisher Ultra Max ad as she had not heard it but said that ASCI would communicate to the advertiser to remove it if the complaint is upheld. 
Radio ads lack body for pre-screening  
While the ASCI is known to do a good job of monitoring brands' advertising post being put on air, there is no organisation, government or otherwise, to pre-screen these ads. Brand expert Harish Bijoor and CEO of Harish Bijoor Consults Inc said that most of the advertising industry is self-regulated and is looked into by ASCI.
“I believe that there should not be any pre-censorship because a lot of restrictions and bureaucracy gets involved. Advertisers should follow self-regulation and it is a good procedure to follow”. He further added that if people are still not satisfied with any action taken, they can file a public interest litigation (PIL) in the consumer court. Apart from the ASCI for TV, the Indian Broadcasting Federation (IBF) has the Broadcasting Content Complaints Council (BCCC) which takes action on objectionable ads. The radio industry, however, does not have any body like this which looks at its commercials before they go on air. As a result, certain companies with surrogate brands can take advantage of the situation.
Sridhar Ramanujam, Founder and CEO, Integrated Brand-Comm too said that as far as he knows, there is no organisation for pre-approving radio ads. He said that TV on the other hand, has the CBFC for screening.
“Surrogate advertising has been there for years. As long as brands keep producing alternate products, they can take advantage of the rule. People can take their issues to ASCI and get them addressed,” he said.
The lack of a pre-screening authority is surprising, considering the amount of regulations and restrictions that the government has otherwise imposed in terms of radio content, especially news, on private channels. On the radio, only political ads are subject to pre-screening.
Advertisers, however, have to adhere to the All India Radio (AIR) Code of Conduct which under section 2 (vii) states that ‘No advertisement shall be permitted which relates to or promotes cigarettes and tobacco products, liquor, wines and other intoxicants’. 
The weak regulation for surrogate advertising at the government level can be because it falls under the jurisdiction of at least five Ministries – Consumer Affairs, Health, I&B Ministry, IT and Social Justice and Empowerment. There is no central law that regulates various aspects alcohol promotion. 
Who should take the responsibility then?
K V Sridhar (Pops), Chief Creative Officer, Sapient Nitro India said that when it comes to surrogate advertising, there are two sides i.e. the legal and the moral angle. He said that people might not like it if the surrogate product that is being advertised does not exist. “Brands breaking the surrogate advertising laws might feel situational victories, but in the long term, it will affect the brand. One needs to be careful about the legality and morality. 
“A product should stand by itself. The advertising industry has used self-censorship and it has worked.” He further added, “It is also the decision of the TV channels, radio channels, print players, etc., whether or not the ad is in good taste or morally correct, and whether it should be aired.”
The CEO of the private radio station mentioned above passed the buck on to media agencies. “Media agencies have to look into whether surrogate advertising is following the AIR Code of Conduct. Radio, as a medium, is much stricter in fact than others. There is a monitoring body by the government in every city which monitors every bit of programming on radio. If someone breaks the rules, they will send a notice to the advertiser and mark the broadcaster in CC.” He further added, “Around 7-8 years ago, we used to get such notices from the government often, as a few ads would slip through. Now we don’t get much notices.”
When asked about whether they check on the brand extension or surrogate brand, he said that they ask for proof of the existence of the brand in a particular space, and the operations and sales of the particular brand in the space that they are advertising. He further added that the reason why a brand would try to evade the rules of surrogate advertising on the radio was that the risk is far lesser due to much lesser costs involved and can be changed easily. But on TV, costs can run into crores as it's a visual medium. Hence, “it is a much larger risk and much more difficult to change”.
Till stronger central laws on surrogate advertising are in place, it is up to brands to self-regulate and adhere to the laws and ASCI to see that no one evades it, but there may always be some who flout the norms and take advantage of the loopholes.

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