Comparative Advertising

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In 1972, the Federal Trade Commission issued a statement of support for comparative advertising—ads that openly name an advertiser's competition—arguing that the format could benefit consumers by providing more and better information than had been available in the past.

Through direct comparisons, the FTC said, consumers could learn which brand had the lowest price or the most relevant attributes or which tasted best. Comparative advertising, it was contended, would eliminate vague references to "Brand X" or the "leading brand," which were thought to be of little value to consumers.

While comparative advertising was never illegal per se in the U.S., its basis of law lies in the Federal Trade Commission Act of 1914 and the Wheeler-Lea Amendment of 1938; the latter gave the commission the ability to stop companies from disparaging competitors even when those competitors lacked proof of injury.

In 1974, what became the first landmark case involving comparative advertising went before the Council of Better Business Bureau's National Advertising Review Board, an industry self-regulatory group. The dispute involved a campaign by Schick for the Flexamatic electric shaver that claimed the Flexamatic shaved closer than rival products marketed by Norelco, Remington and Sunbeam.

A fourth competitor, Ronson, not named by Schick in the ads, asked the FTC to investigate, charging that Schick refrained from naming Ronson because Schick had copied Ronson's shaving screen. The NARB concluded that the Schick campaign was in part false and misleading. Although statistical data presented in the campaign were found to be valid, the board ruled that arguments based on those data had likely been misused.

Historically there has been little standardization among codes for comparative advertising, and at the beginning of the 21st century, confusion still remained regarding comparative advertising standards, definitions and effectiveness.

Seeking a taxonomy

One proposed taxonomy of comparative advertising includes "inferiority comparatives," "parity comparatives" and "superiority comparatives." Another proposed taxonomy includes "no intended comparative," "inferiority comparatives," "parity comparatives" and "superiority comparatives partnership comparatives.

Comparisons based on inferiority are rarely used by advertisers because of the risk that comes with claiming, even in a humorous spirit, that one's own brand is inferior to others. On occasion, however, marketers do tell the world that their product is the smallest or the ugliest (Volkswagen's "Think Small" campaign for the Beetle via Doyle Dane Bernbach, beginning in 1959) or "No. 2" (Avis Rent a Car's "We Try Harder" campaign from 1963, also from DDB).

Marketers that want consumers to believe their product is as good as another marketer's brand use parity comparisons. A 1998 newspaper ad for BellSouth compared its Interactive Paging service with rival Skytel's Skywriter. After listing a number of features that were offered by Skywriter as well as other competitors, the copy continued, "BellSouth Interactive Paging service lets you do all that and even more. . . ."

Superiority comparisons, the most commonly used type of comparative advertising, claim that one brand is superior in some way to its named rivals. Some examples include TV spots from Jack in the Box comparing itself to fast-food rivals Burger King and McDonald's and Tylenol PM's commercials comparing its effectiveness to that of Excedrin PM.

Comparative advertising can help a start-up or low-share brand associate itself with an established brand, causing consumers to believe the two are similar. Comparative ads also garner high recall scores. Other reasons for using comparative ads include their ability to create confidence for the advertiser's brand, promote competition, stimulate comparison shopping, aid brand differentiation, lead to more rational consumption decisions and make advertising more believable and less deceptive.

On the other hand, there are several reasons advertisers might choose to avoid the use of the comparative format in ad campaigns. Comparative advertising occasionally can lead to marketers appearing to fight in the media, such as in the long-running comparative advertising battle between Coca-Cola Co. and PepsiCo. Another concern is that comparative advertising generates irrelevant information and can lead to confusion.

Comparative campaigns, now common on TV, sometimes leave viewers unclear as to which of several rivals showcased in a commercial is to be preferred—is it the sponsor's brand or the compared brand?

Assessing effectiveness

Although comparative advertising has been studied extensively and is frequently used, its effectiveness remains unclear. Since the mid-1970s, more than three dozen empirical studies have been conducted in the U.S. Findings were analyzed along the "hierarchy of effects" advertising model, which contends that advertising is effective along a continuum ranging from cognition (attention, recognition, recall, information) to affect (attitudes toward brands, attitudes toward advertisements/commercials, credibility, loyalty attitudes) and culminating in conation (purchase intentions and purchase behavior, including consistent loyalty).

Perhaps of greatest importance to marketers, comparative advertising has been found to be more effective than non-comparative advertising in generating purchase intentions and actual purchase behavior, although market share levels, product involvement and other variables often mediate these findings.

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