NARC urges advertisers to self-regulate

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The National Advertising Review Council, concerned increasing complaints about allegedly misleading food, dietary supplement and pharmaceutical ads could prompt government action, is mounting a major push to urge advertisers to go the self-regulation route.

An outreach effort to marketers and a series of seminars are planned by the council, which is a joint effort between the Council of Better Business Bureaus and major ad groups. The goal is to enlist non-Better Business Bureaus members to join and handle ad complaints through NARC's National Advertising Division.

"We can identify the hot issues in marketing through our complaints," said Jim Guthrie, president of the council. "In the 1980s, it was heavily the environment. In the 1990s it was the newly deregulated fields of energy and telecommunications." Now, the issue is food, dietary supplements and pharmaceutical ads, he said.

Mr. Guthrie said the Food and Drug Administration's 1997 decision to allow increased direct-to-consumer advertising of pharmaceutical drugs is one reason for the complaints. Another reason, however, is the Federal Trade Commission's recent concerns about diet supplement ads.

"In part, our action is a result of the FDA and FTC's stepped up activity," he said. "But we are also reacting to marketplace changes that dramatically changed and increased consumer demand and advertising for these products."

NAD receives complaints from marketers who challenge one another's ads as well as from consumers who file complaints through their local Better Business Bureau Offices. The group also monitors ads on its own for unsubstantiated claims.

Mr. Guthrie said 30 of NAD's challenge cases decided in the last 12 months-or about 20% of the docket of 150 cases it handled last year-were concentrated in the areas of food, dietary supplement and pharmaceutical ads. Another 20 cases-about half NAD's current caseload-are pending.

NAD's "Operation Health Advertising" effort kicks off with a two-day food and pharmaceuticals conference Oct. 29 and 30 in New York. As part of the effort, Mr. Guthrie, along with NAD supporters, will visit and lobby marketers who have not been part of the self-regulation process as yet.

"We need support. Everybody is not involved," said Mr. Guthrie. "We need to create greater awareness and have been meeting with trade associations to talk about our role."

Dan Jaffe, exec VP of the Association of National Advertisers, said it's not only regulatory action marketers have to be worried about. Congressional action is also possible. "Clearly the drug issue is hot," he said. "There are some people in Congress who are determined to undermine DTC and saying the ads are not adequate. Hopefully this will sensitize advertisers that the issue is getting in the spotlight."

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