Surrogate ad ban: Is the industry ready for big changes?

Admen and brand experts feel that while a blanket ban might not be the solution, there should be some consideration in terms of what can or cannot be allowed

e4m by Mansi Sharma
Published: Jun 17, 2022 8:38 AM  | 7 min read

"Khoob jamega rang jab mil bhaitenge teen yaar... Aap, main aur Bagpiper.” Who doesn’t remember this tagline that made its way to the Indian television to sell ‘soda’ with big celebrities like Dharmendra, Jackie Shroff and others as its face, in the early 1990s. It was possibly the first instance of surrogate advertising on Indian TV, a route which became even more popular after India banned the advertising of tobacco and liquor brands under the Cable Television Networks (Regulation) Act, 1995.

And then came a barrage of some forgetful and some iconic surrogate ad campaigns – men sucking in their bellies in front of women or finding the perfect ring to make up for forgotten anniversaries to promote some obscure music CDs but with a very popular brand name, or action heroes doing backflips to sell mouth fresheners – we have seen everything!

But the latest CCPA guidelines by the government are going to curb all such misleading ads and not just on television but print and online as well. The move is getting mixed reactions from the industry with some supporting the move to others seeking answers around the scope of brand extensions, to some questioning how curbing advertising for legal products helps the cause.

e4m dives deeper into the situation, which could very well be the demise of surrogate advertising after nearly three decades of a successful run.

Impact on Media Revenues

While there are no transparent figures available when it comes to how much products like alcohol and cigarettes spend on advertising annually, as per media experts, the surrogate industry pumps in anywhere between Rs 600 and Rs 700 crore in the Indian advertising industry. Around 60-70 per cent of these spends are targeted towards TV, followed by digital advertising, which is getting more popular by the day.

However, the ad spends are not much as compared to other FMCG products and might not have far-reaching consequences from a revenue perspective for the advertising industry, opines brand strategist and coach Ambi Parameswaran.

Brand-nomics MD Viren Razdan adds that a good chunk of this marketing spend is also directed towards sponsorships and other marketing activities, “A huge amount is spent on marketing and just not advertising. Sponsorships have been key to brands, for a long time a tobacco brand was a long-running partner to the cricket World Cup. Money would find its flow to other marketing activities whether it’s on-ground promotion, etc.”

To give an idea of how popular the sponsorship route is for such brands, Royal Stag was amongst the associate sponsors at IPL 2022, and Royal Challengers Bangalore, is in fact, an extension of United Spirits’ liquor brand Royal Challenge.

The industry is of the view that alternate routes to keep pumping the money in the advertising ecosystem will eventually get created as the consumption of such products is high. OTT and other content partnerships could be one of the routes.

Socxo CMO & Program Head Ajit Narayan quips, “So far this seems like a blanket ban on the various categories. Print, TV, Outdoor, Radio would be hit by this if it is implemented. Digital might not get impacted that badly as there could be workarounds. For example, international brands have their own digital presence which are only age restricted. That too by self-authorisation only. Indian brands would have to figure out a way around using digital media. No clear direction has been communicated on this.”

But is blackout a solution?

While there is still no clarity on the purview of these regulations and whether they will be impacting the genuine brand extensions as well – Blenders Pride Fashion Tour and Bacardi Weekender Music Festivals being a few examples – the industry feels that a blanket ban might not be the solution, and there should be some consideration in terms of what can be allowed and what can’t be.

Parameswaran says, “I believe if a product is allowed to be marketed in the open market, the law should permit its advertising as well, maybe with stringent controls. If you don’t, you are allowing the incumbents to continue to rule the market, throttling any new efforts for better products. Allowing genuine brand extensions is one thing (Guiness Book of Records is an innovation from Guinness breweries which has become an independent business) but allowing ABC whiskey glasses, or PQR Mineral Water or XYZ Music CD is just a loophole to advertise a product that is not permitted to be advertised. What is true of liquor is also true of the pan masala brands, many of them have launched products like ‘mouth fresheners’ that are advertised using celebrities.”

He further asks, “The bigger concern is where do you draw the line on these. How to separate a genuine brand extension [RCB] from a surrogate product? Who will monitor the financials to ensure that what is touted to be a genuine brand extension is not just a surrogate product? It is a difficult puzzle to unravel.”

L&K Saatchi & Saatchi Chief Strategy Officer Snehasis Bose asks similar questions, “The long and grey version of the answer is a series of other questions: What is the objective of the advertising ban? Why is the production and selling of these products allowed in the first place? Why let the businesses operate but impede their marketing? Due to this creation of obstacles to the market will there be a reduction of state and central excise for these industries? And in the series of greys, a related question: Globally diet-related diseases kill more people per annum than smoking. Is this ban a precursor to a ban on ‘junk’ food advertising?”

On the other hand, Wunderman Thompson Vice President & Strategy Director Amita Major feels that it is a great move on the center’s part as it accelerates the process of being compliant for both brands and agencies. “I think this a very consumer-first set of guidelines and it was important to bring in such tighter regulations. It is important to protect kids and people who do not fully understand the implications of such products from such advertisements.”

Infectious Advertising Co-founder & Director Nisha Singhania agrees but she feels that there should be a more serious discussion on the purview of such a ban and there should be an industry consensus on how these products can manage their businesses and brand extensions in advertising.

How will it impact the alcobev and tobacco industry?

While there might not be an evident dip in sales or revenues for the categories because of the ban, the long-term impact can be quite significant as Bose points out, “Data shows in countries where there is a complete ban of advertising of these ‘sin’ categories, there has been a gradual and long-term reduction of consumption of the respective categories. The brands that pivot to other mediums, eg (age-gated) experiential marketing or Point of Sale focus have benefited. The ban has also made it near impossible for new brands to achieve business success of any scale. While fostering innovations like Heat Not Burn products and ready-to-drink alcohol cans to ensure brand and category AIDA (Attention-Interest-Desire-Action)!”

Narayan shares a similar point of view, “As a consumer, this may or may not impact purchase in the near term. Long term, brand imagery would get impacted. Alternatively, perception building could be restricted as functional only. And that could become the way of accepting or rejecting brands in a category. For example, cigarette advertising was completely banned in all forms. So, brands took to retail. Which could be a model that brands could resort to. Imagery of the brands will no doubt take a hit. But that could be in the lower price point brands. Not the internationalised ones (which could leverage digital more easily).”

The bottom line is that the regulations are in favour of consumers of media, and the long-term impacts could impact the preference of using such products, but there needs to be clarity on legit brand extensions. And to round it off, nothing better than some self-regulation on the part of these brands – instead of finding loopholes, find ways to create sustainable business models that can support the primary products in a responsible manner. 





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