activia yogurtEarlier this week Scott raised the issue of ethics in business and talked about Rotary’s motto Service Above Self. The motto is supported by Rotary’s Four Way Test: Is it the truth? Is it fair to all concerned? Will it build goodwill and better friendships? Will it be beneficial to all concerned? This got me thinking about an area of business that’s highly discussed in terms of ethics — advertising.

What is Advertising?

The basic point of advertising is for a business to communicate (sell) their goods or services to prospective buyers. Seems pretty straight forward, right? Turns out, it’s not always clear cut.

Advertising has become so much more than just selling. It’s one of the most public ways to express your brand.

Think back to those awesome Mac vs. PC ads Apple put out a number of years ago. Here’s one to refresh your memory:

These series of ads were crucial in establishing Mac as a cooler, better alternative to PC, one of the key aspects of the Apple brand (especially at that point in time).

Advertising also has developed a strong cultural component where sometimes it reflects current trends in society whereas other times advertising is actually creating new trends. We see this most in the fashion and cosmetic industry.

Code of Conduct

American Association of Advertising Agencies has established a code that their members agree to abide by. Other advertising associations have similar standards.

Members of the AAAA agree that they “will not knowingly create advertising that contains:

a) False or misleading statements or exaggerations, visual or verbal

b) Testimonials that do not reflect the real opinion of the individual(s) involved

c) Price claims that are misleading

d) Claims insufficiently supported or that distort the true meaning or practicable application of statements made by professional or scientific authority

e) Statements, suggestions, or pictures offensive to public decency or minority segments of the population.”


A lot of this code, and problems related to ethics in advertising, revolves around the notion of “truth” and unfortunately, there are often shades of truth or, being truthful, but avoiding talking about certain things. Advertising is a very powerful medium because it’s more that just about being convinced to buy something. It goes deeper than that. We become emotional invested in products or brands we trust. Maybe that’s why we get so upset when we find we were deceived.

It Doesn’t Pay to Mislead 

While it might be tempting to slightly stretch the truth a bit, you may up have to pay for the indiscretion and there’s a high chance you’ll lose a lot of brand equity in the process. This Business Insider article features 14 brands who had to pay millions because of false advertising.

For example, Dannon’s Activia brand yogurt touted the “clinically” and “scientifically” proven nutritional benefits of the product when it was actually pretty much the same as every other kind of yogurt. A class action settlement forced Dannon to pay up to $45 million in damages to the consumers that filed the lawsuit.

Ask Yourself 4 Questions

When your company or your marketing agency is creating new advertising, ask yourself the four questions from Rotary before you finalize your creative:

  1. Is it the truth?
  2. Is it fair to all concerned?
  3. Will it build goodwill and better friendships?
  4. Will it be beneficial to all concerned?

The answers (hopefully you are truthful with yourself) will guide your next steps, either to move forward or reconsider your messaging and/or visuals.

What other questions help us produce more ethical advertising?