SURROGATE ADVERTISING IN INDIA A NEVER ENDING DILEMMA

IN INDIA , BOTH LIQUOR AND CIGARETTES ARE MANUFACTURED AND SOLD FREE WITHOUT ANY RISTRICTIONS…According to a recent NIMHANS study, kids as young as 19 are today taking to alcohol. The age just a few years back was 27. The study warns that in the next few years, children aged 15 years will take up drinking." 

Advertisements have a strong influence in our life. We like them because they provide information and create awareness about the market. Our decisions whether to buy a product or not, is often completely influenced by the promotional activities of the companies concerned. Therefore, due to the widespread adverse impact that advertisements of unhealthy products like tobacco, liquor can cause, Indian government has always endeavoured to curb or atleast restrict rampant advertisements of such products by appropriate legislations, orders and directives.

These advertisements were opposed by a major section of the society. Hence the Government had imposed a ban on advertisements of these products in the media in the year 2002.

Origin:As a reaction to the directive of Government to ban advertisements of products that are adverse to health, the major companies of liquor & tobacco sought other ways of endorsing their products. They have found an alternative path of advertising through which they can keep on reminding the people of their liquor/tobacco brands: they have introduced various other products with the same brand name. Launching new products with common brand name is known as brand extension, which can be carried out for:• related products (e.g.: Tata Salt and Tata Tea) or • unrelated products (e.g.: Tata Tea and Tata Indica).

The problem occurs when heavy advertising is done so that the customers do not forget their liquor & tobacco brands, for which advertisements are banned. The advertisements for such new products are placed under the category of "Surrogate Advertisements". Their only objective is to compensate the losses arising out of the ban on advertisements of one particular product (i.e. liquor). The companies can always claim that the order is being implemented and advertisements of liquor are banned, but the objective of the Government behind imposing the ban is not fulfilled. It's a new weapon of Proxy War.

MEANING OF SURROGATE ADVERTISING It is one where a product which is different from the main product (parent brand), is

advertised and promoted with the same brand name as that of the main product (parent

brand) to camouflage the later. The product, thus, advertised is called “SURROGATE

PRODUCT” and such advertising is referred to as “SURROGATE ADVERTISING”.

Surrogate advertisement by Tobacco and Liquor industryExamples from tobacco industry - Red & White bravery awards, Wills lifestyle, Four Square white water rafting, etc Examples from liquor industry - Bagpiper soda and cassettes & CDs, Haywards soda, Royal Challenge golf accessories and mineral water, Kingfisher mineral water, White Mischief holidays, Smirnoff cassettes & CDs, Imperial Blue cassettes & CDs, Teacher's achievement awards etc.

Which are the brands or categories which will be affected? The biggest names in the fray are Kingfisher and Wills. The former advertises its mineral water and airlines, while Wills has lifestyle products and a personal care range. 

Detractors of the ban argue that, today, Kingfisher Airlines is a much bigger brand than the beer. It is brands such as Seagram (which releases CDs), McDowells (soda), Bagpiper (soda, cassettes and CDs), Godfrey Phillips (bravery awards), and Bacardi (cassettes and CDs) that will probably be hauled up. 

Gutkha companies indirectly advertise pan masalas, which have the name of the main brand (Goa, Pan Bahar or Pan Parag). And most recently, White Mischief sponsored a programme called License2flirt on MTV. Not to forget the ‘Oh la la la lule ho’ tune of Kingfisher (water or beer?). 

The industry feels that smaller brands will get affected. A Wills or a Kingfisher might argue that advertising for airline and lifestyle brands can no longer be called ‘surrogate’ in the English meaning of the term and find a way out of the imbroglio. But smaller brands will end up being affected because they are selling cassettes and CDs or mineral water and soda under Big Brother’s name. Desai is quite emphatic: “Liquor companies have no business to be in the CDs and cassettes business.” 

"HUM, tum or mera Bagpiper". This Bagpiper club soda advertisement, featuring cine celebrities, is similar to the earlier one for Bagpiper whisky.

The advertisement comes with the same music and punch line as the one for the popular liquor brand telecast before the ban on liquor advertisements.

This phenomenon, known as "surrogate advertising" (duplicating the brand image of one product extensively to promote another product of the same brand), has become commonplace

Sociological studies have shown that, in India, a significant share of income of a large section of the population is spent on liquor, potentially leading to financial distress and health hazards. According to the International Wine and Spirit Board, a liquor industry publication, there will be a jump in the number of people reaching the legal drinking age of 25 within the next few years. The implication is that the problem is going to grow.

According to Indian law, surrogate marketing of alcohol products is not allowed. Vijay Mallya, the chairman of United Beverages (UB) Group is the owner of the Banglore’s IPL team. Mallya had named the team ‘Royal Challengers’ which is also the brand name of a whisky manufactured by the UB Group.

The petitioner said that it should not allow to promote a liquor brand under the name of cricket tournament. He immediately wants to prohibit the illegal promotion of the liquor. He also demands the change of name of the iPL team, Royal Challengers

On Monday, the Supreme Court had dismissed a petition that alleged that Vijay Mallya, who owns the IPL Bangalore team, was promoting the liquor brand produced by his United Breweries Group through his team’s name.

The Supreme Court bench pointed out that the team was not named ‘Royal Challenge’ , the liquor brand, but ‘Royal Challengers’.

“Only those who drink can be attracted by these things,” the bench observed in a lighter vein, alluding to the fact that a name would not have any effect on non-drinkers.

But Ramadoss alleged that Mallya was using the banner ‘Royal Challengers’ as a means to promote one of his liquor brands.

SURROGATE ADVERTISEMENTS PROMOTED BY LIQUOR AND TOBACCO INDUSTRY

The liquor industry is a prominent player in this game. Few surrogate advertisements shown in print, electronic and outdoor media are - Bagpiper soda and cassettes & CDs, Haywards soda, Derby special soda, Gilbey green aqua, Royal Challenge golf accessories and mineral water, Kingfisher mineral water, White Mischief holidays, Smirnoff cassettes & CDs, Imperial Blue cassettes & CDs, Teacher's achievement awards etc. These products bear exactly the same brand name and logo, which we had seen earlier in liquor advertisements. It was little surprising to know that liquor giants like McDowell's and Seagram's have entered into new segments like cassettes & CDs, mineral water, sports accessories etc. Later it was found that the basic aim of these surrogate advertisements was to promote their liquor brands like beer, wine, vodka etc. This brand extension is an act of bypassing the advertisement ban.

A similar trend is followed by companies making Cigarettes, Paan Masala and Gutkha. Few examples of surrogate advertisements in this category are - Red & White bravery awards, Wills lifestyle, Four Square white water rafting, Manikchand awards etc. Though a ban has been imposed on advertisements endorsing tobacco products, this industry has resorted to surrogate advertising a few years ago. The Health Ministry has recently implemented the tobacco control legislation which will imply a complete ban on advertisements and all direct & indirect promotional campaigns for tobacco products. In 2001, Indian Tobacco Company (ITC) had voluntary withdrawn the Wills Sports sponsorship of the Indian cricket team when the Government had first proposed a ban on advertising through legislation.

HE CORPORATE STANDPOINT

The industry segment has its own standpoint in defense. The liquor lobby claims that everything is in accordance to the Government regulations. "If a brand has equity, why shouldn't it be allowed to advertise? Also, brand extension is an industry practice adopted by different product categories," comments Alok Gupta of UB group. "When we advertise our products, we follow all the guidelines," declares president, sales & marketing, Radico Khaitan. They clarify that they have stopped showing liquor advertisements and they are free to use the brand name for any other products. Even the Confederation of Indian Alcoholic Beverages Companies (CIABC) advertising code maintains that advertisement of products (real brand extensions) by the liquor industry must be allowed.

From a layman's point of view, their claims seem to be justified. But this is a clear example of taking advantage of the loopholes. There is a point to ponder. When they have stopped showing liquor advertisements, why the same brand name and logo is used to promote products like cassettes & CDs or mineral water? They could have assigned different brand names. It seems they have a hidden agenda of highlighting the liquor or tobacco brand.

A similar tussle over the issue of surrogate advertisements in politics was raised in April 2004 on the eve of Lok Sabha elections. Complaints of slanderous and offensive advertisements were raised by two major political parties - BJP and Congress against each other. The issue became so serious that the Supreme Court had to interfere in this affair. Finally on 13 April 2004, the Court gave a verdict to curb smear advertisements on electronic media. By appointing Election Commission as referee, the court has tried to put an end to surrogate advertising in politics.

According to the Cable Act under the ministry of information and broadcasting,- "no broadcaster is permitted to show an advertisement which promotes directly or indirectly, sale or consumption of cigarettes, tobacco products, wine, alcohol, liquor or other intoxicants…" Now a new clause has been added under the act stating that "any advertisement for a product that uses a brand name which is also used for cigarette, tobacco product, wine, alcohol, liquor or any other intoxicant will not be permitted". Finally, in April 2005, the ministry resorted to a ban on surrogate advertisements of liquor and tobacco products on television.

After this directive, the surrogate advertisements are seldom shown on television. Now the companies will have to reframe their policies. But who will take care of print and outdoor media is not certain.

According to ASCI (Advertising Standards Council of India), surrogate advertisements are harmful. Now it will be up to the ASCI to take up the matter with the respective companies.

Legislative Measures:The Cigarettes & Other Tobacco Products (Prohibition of advertisement and regulation of trade and commerce, production, supply and distribution) Act, 2003: This Act was enacted to implement measures to ensure that effective protection is provided to non-smokers from involuntary exposure to tobacco smoke and to protect children and young people from being addicted to the use of tobacco;

It was also considered expedient to prohibit the consumption of cigarettes and other tobacco products which are injurious to health with a view to achieving improvement of public health in general as enjoined by article 47 of the Constitution;

Section 3(a) of the said act defines ‘advertisement’ as including: ‘any visible representation by way of notice, circular, label, wrapper or other document and also includes any announcement made orally or by any means of producing or transmitting light, sound, smoke or gas’

Interpretation: Surrogate advertisements clearly come under the definition as it involves making the tobacco labels clearly visible to people through other products by the same name. Moreover the public is always reminded orally of the tobacco’s brand name through the advertisements of such other products. So such advertisements are liable to be a subject matter of this Act and therefore subject to its restrictions.

Section 5(1) of the Act states: ‘No person engaged in, or purported to be engaged in the production, supply or distribution of cigarettes or any other tobacco products shall advertise and no person having control over a medium shall cause to be advertised cigarettes or any other tobacco products through that medium and no person shall take part in any advertisement which directly or indirectly suggests or promotes the use or consumption of cigarettes or any other tobacco products.’Section 5(3) of the Act states: ‘No person, shall, under a contract or otherwise promote or agree to promote the use or consumption of—(a) Cigarettes or any other tobacco product; or(b) Any trade mark or brand name of cigarettes or any other tobacco product in exchange for a sponsorship, gift, prize or scholarship given or agreed to be given by another person.’

Demerit: This section restricts advertisement, promotion of tobacco products for direct/ indirect pecuniary benefit. It is narrow since it doesn’t take within its ambit the scope of promoting tobacco through brand extension and sponsorships.

The Ministry of Health and Family Welfare made certain amendments to the above act in 2005, stating that the word ‘indirect advertisement’ mentioned in Section 5(1) would mean:• The use of a name or brand of tobacco products for marketing, promotion or advertising other goods, services and events; • The marketing of tobacco products with the aid of a brand name or trademark which is known as, or in use as, a name or brand for other goods and service;• The use of particular colours and layout and/or presentation those are associated with particular tobacco products; and• The use of tobacco products and smoking situations when advertising other goods and services. Merit: It’s a comprehensive definition and the amendment has taken care of the legal lacuna pointed out above.

What is the background? And why has the government ordered a ban?A senior official in the health ministry says that it is a question of public health. There is an act in place for tobacco (Tobacco Advertising Prohibition Act, 1992), but not for alcohol. And by surrogate advertising, people are constantly reminded of the mother brand. 

To quote from the health minister’s letter, “Considering the ill effects of cigarettes, alcohol and other intoxicants, the government has banned advertisements of these products in the media. As a reaction, the liquor and tobacco majors have sought other ways of advertising their products. They have introduced various other products with the same brand name and are carrying out heavy advertising so that consumers do not forget their liquor brands.” 

In 2000, the Indian Broadcasting Foundation (IBF) had sent a recommendation to the government about surrogate advertising. No one raised any questions for a while. In 2002, broadcasting industry sources revealed plans to put in place measures for self-regulation and monitoring, even before the I&B ministry took concrete steps in this regard. The broadcasters, who were members of the IBF, announced that they would come up with an advertising code specific to surrogate advertising.

Meanwhile, in 2005, the government banned – and then allowed – surrogate advertising. Jawahar Goel, president, IBF, says, “In 2006, notices were issued by the ministry all of a sudden and the channels were asked to run a scroll of apology just before Independence Day. Then we asked who is going to decide, what is brand extension and surrogate – there should be a body which should decide.” 

Discussions went on with the I&B ministry. Agencies played merry-go-round. If channel A was notified, then agencies went to channel B and then to channel C. By the time, channel A had sorted out the issue and the agencies went to them again. It was then that the IBF and the ministry decided that the ads would go through the Central Board of Film Certification (CBFC) for all brand extension commercials. But as Goel and I Venkat of IBF put it, nobody from the government consulted the IBF or ASCI or CBFC before the current notification. 

Advertising Standard Council of India (ASCI) code:ASCI is a voluntary self-regulation council, registered as a not-for-profit Company under section 25 of the Indian Company Act. It’s formed to safeguard against the indiscriminate use of advertising for the promotion of products which are regarded as hazardous to society or to individuals to a degree or of a type which is unacceptable to society at large.

Section 6 of the said code states: ‘Advertisements for products whose advertising is prohibited or restricted by law or by this code must not circumvent such restrictions by purporting to be advertisements for other products the advertising of which is not prohibited or restricted by law or by this code. In judging whether or not any particular advertisement is an indirect advertisement for product whose advertising is restricted or prohibited, due attention shall be paid to the following:

(a) Visual content of the advertisement must depict only the product being advertised and not the prohibited or restricted product in any form or manner. (b) The advertisement must not make any direct or indirect reference to the prohibited or restricted products.(c) The advertisement must not create any nuances or phrases promoting prohibited products.’Interpretation: It specifically prohibits surrogate advertising and lays down guidelines which qualifies it to be so, namely • Whether the legal product under a tobacco brand, sought to be advertised, has been produced in reasonable quantities or not.• Whether in the disputed advertisement, there are any direct/indirect clues to the promotion of the restricted product i.e. tobacco or not.

The Prohibition of Publication or Telecast of Vulgar, Obscene and Surrogate Advertisements and Re-mix songs by Print and Electronic Media Bill, 2004: Though the bill hasn’t yet seen the light of the day, the broad framework has been laid down by the legislature and given to the executive to frame the details under delegated legislation. It was initiated to provide for ‘total ban on the publication of …….....surrogate advertisements showing substitutes of products, particularly of liquor and tobacco products by magazines, newspapers, etc. and telecasting of …………surrogate advertisements………….so as to protect the Indian culture and values………’

For the first time, a legal definition of ‘surrogate advertisements’ has been attempted through Section 2(d), which states: ‘an advertisement which shows a substitute product in the guise of the real one which otherwise cannot be legally advertised through the print and electronic media.’Section 3 prohibits the publication by print media and telecasting of surrogate advertisements and provides that violators of the said provisions shall be punished accordingly.

Issues for concern:• In a significant policy shift, the government has in principle decided to permit non-liquor and non-tobacco advertisements of Kingfisher and Wills brands on TV channels. This is despite the fact that the Cable TV Network Rules, 1994 Rule 7(2) (viii) prohibits direct or indirect consumption, sale or production of cigarettes, tobacco products, wine, alcohol, liquor or other intoxicants.

Recently, the Information and broadcasting ministry has assured the people that all surrogate advertisements would soon be barred from appearing in any form of media and stricter measures of surveillance to identify such advertisements would be put in place.

• Manufacturers further reduce the chances of young people failing to get the message by sponsorship of sports teams and events and music concerts having particular appeal to the young.

Suggestions for measures to be taken:1) Amendment to Cable Television Act made under Networks (Amendment) Rules, 2006 states that no advertisement which violates ASCI standards are to be allowed. But it has been noticed that despite legislations aiming at direct prevention of surrogate advertisement, no strict adherence could be observed as is evident in the ITC case above. Providing teeth to the ASCI to enable it to take action against false and misleading advertisements and keeping a vigil over close evasion of law is a step to be taken.

2) FCTC (Framework Convention on Tobacco Control):It is a convention developed by World Health Organization (WHO) as a model to be adopted by any country desirous of enforcing strict anti-tobacco rules within its domain.

Article 13 of the convention talks about tobacco advertising, promotion and sponsorship: It provides that even if the constitution doesn’t permit a comprehensive ban on tobacco advertising, it can resort to other ways too like • Prohibiting advertisements which create an erroneous impression on consumers.

• Restrict use of direct/indirect incentives encouraging public use of tobacco.• Restrict media advertising in a period.• Restrict tobacco sponsorships of public events. India can follow the detailed guidelines with respect to surrogate advertisements given in this convention. In 2001, Indian Tobacco Company (ITC) had voluntary withdrawn the Wills Sports sponsorship of the Indian cricket team when the Government had first proposed a ban on advertising through legislation.

The government's move is aimed at implementing the provisions incorporated in the Cable Television Network Rules 1994 to prevent surrogate advertisements of alcohol and tobacco products on TV.    

Introduced by Information and Broadcasting Minister Ambika Soni in both Houses of Parliament yesterday, the paper suggests that if "a product that uses a brand or logo, which is also used for promoting cigarettes and tobacco products, then the visual of the advertisement should depict only the product being advertised and not prohibited products in any form or manner".     

The paper, citing the proposed rules in connection with the matter, also says that "advertisement must not make any direct or indirect reference to the prohibited products".     

In addition, the advertisement must not contain any nuances or phrases promoting prohibited products, and also the commercial must not use situations typical for promotion of prohibited products when advertising other products.     

The above mentioned rules were issued through a Gazette notification by the ministry on February 27 this year, and were included in the existing provisions of the Cable Television Network Rules 1994, titled as Cable Television Network (Amendment) Rules 2009

3) Other Methods:• Measures may also be considered to ensure that brand names or logos of tobacco products are not visible, even if such brands support international events.

• Making transparent laws banning surrogate advertisements for different products under a single brand names, for instance by amending the Trade Marks Act;

• Calling on the ASCI address complaints received from consumers against surrogate advertisements and take appropriate actions immediately;

• Creating a consumer awareness programme to help people understand the negative impact of surrogate advertisements;

• Adopting strict laws to penalise those companies featuring surrogate advertisements without any real existence of the product;

• Requiring advertising agencies to have full knowledge of the products under the same brand for which they are promoting advertisements, and taking legal actions against those agencies which design surrogate advertisements.

• Bans against surrogate advertisement should also spread its net to include the new electronic media like the Internet, e-mail, pagers and CD-ROMS, print and outdoor media, asking them to adhere to advertisement codes and not encourage surrogate advertisement.

• Youth led campaigns appealing the government for a comprehensive ban on tobacco advertising through NGOs such as HRIDAY (Health Related Information Dissemination Amongst Youth)-SHAN (Student Health Action Network), created a supportive environment to enforce tobacco control measures. These examples show that role of NGOs should be recognized and they should be given more autonomy to work on such issues.

There should be stringent regulatory measures to curb the practice, such as: i) making transparent laws banning surrogate advertisements for different products under a single brand names, by amending the Trade Marks Act, for instance;

ii) providing teeth to the Advertising Standards Council of India to enable it take action against false and misleading advertisements, and keep a close vigil over clever evasion of the law;

iii) asking the electronic and print media to adhere to the advertisement codes and not encourage surrogate advertisements;

iv) calling on the ASCI address complaints received from consumers against surrogate advertisements and take appropriate actions immediately;

v) creating a consumer awareness programme to help people understand the negative impact of surrogate advertisements;

vi) adopting strict laws to penalise those companies featuring surrogate advertisements without any real existence of the product; and

vii) requiring advertising agencies to have full knowledge of the products under the same brand for which they are promoting advertisements, and taking legal actions against those agencies which design surrogate advertisements.

If one believes that honesty is the best policy and truth ultimately gains, the best policy would be to stand up strongly to the dishonest practices of surrogate advertising

Take a look at these billboards which I noticed on a private flyover a few days back. There is also another print ad in continuation with the Johnnie Walker billboard.

1. Four Square White Water Rafting Four Square Cigarettes

2. Bagpipers Soda and Cassettes Bagpiper Liquor

3. Bacardi Blast CDs and Cassettes Bacardi Liquor

4. Derby Special Soda Derby Special

5. Hayward’s Water/Soda Hayward’s 5000 Beer

6. Radico Khaitan’s Water Radico Khaitan’s 8 pm Whisky

7. McDowell’s Soda/Water McDowell’s Malt Whisky

8. CNTD…. Red & White Bravery Awards Red & White Cigarettes

9. Smirnoff Cassettes and CDs Smirnoff Vodka

10. Seagram Music and CDs Seagram’s 100 Pipers Deluxe

Scotch Whisky

11. White Mischief Holidays White Mischief Liquor

12. Royal Challenge Golf Accessories and Mineral Water, Royal Challengers Cricket Team

Royal Challenge Whisky

13. Kingfisher Bottled Drinking Water Kingfisher Beer

14. Director’s Special Bottled Drinking Water Director’s Special

Whisky