Self-regulation in advertising

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Analysis of market circumstances where industry
self-regulation is likely to be most and least effective



Advertising’ involves the dissemination of information about an organisation, product, service, or idea through the mass media (eg television, radio, newspapers, magazines, billboards etc) by a particular sponsor (the advertiser).

A key feature of advertising is that the advertiser does not communicate directly with the customer. Rather, the advertiser communicates via the mass media. Typically, this means that:

  • the information is provided not only to potential consumers of the product, but also other sections of the community that may have no interest in the product; and

  • there is no opportunity for immediate feedback from the consumer.

This distinguishes advertising from ‘direct marketing’ which involves greater targeting of potential consumers, and approaching those potential consumers directly to generate an expression of interest or a sale. This provides an opportunity for suppliers to obtain direct feedback from individual consumers on the nature of their preferences. Direct marketing is discussed further in Chapter 4.

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