What #AdvertisingBans get wrong about #ConsumerBehaviour

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Advertising bans are increasingly relevant in political debate, with some countries having already established rules that don’t allow for “junk food” advertising. But these proposals are all based on the assumptions that consumers are buying goods that they never would have wanted otherwise, writes Bill Wirtz.

The fundamental question is: Can you make people buy something that they don’t want?

The short answer to that question is: yes. However, you’d be required to force consumers, either directly or indirectly to make that happen. The question is not that of “want”, but rather a question of “who made me want it”.

The American legal scholar Cass Sunstein, who was Administrator of the Office of Information and Regulatory Affairs under the Obama administration published an essay entitled Fifty Shades of Manipulation, in which he tackles manipulation and consumer sovereignty. In the said essay, Sunstein invokes different forms of manipulation, and despite the effort to differentiate, reaches the following conclusion: “It is important to acknowledge that in the commercial realm, manipulation is widespread; it is part of the basic enterprise. For that reason, the ethical taboo on manipulation is substantially weakened, in part on the theory that competitive markets impose appropriate constraints against undue harm. But in some cases, those constraints are too weak, and it is appropriate to invoke social norms or even the law to discipline welfare-reducing acts of manipulation.”

The basic flaw in the essay is a misunderstanding between “manipulation” and “marketing”, two words which are not pointing to the same type of strategy. Sunstein seems to believe that all types of advertising mislead consumers about the product, when this is actually a more exceptional case. When Volkswagen manipulated their vehicles in order to show a lower emissions output, they were giving consumers false information about their product. When companies advertise health benefits of their products that cannot be proven, then they are intentionally misleading their customers. However, this is miles away from advertising a product as being cool, refreshing, comfortable, or trendy. Are we to define the mere fact that a product is being described by the producer as “good”, as manipulation? Because by this same standard, I could feel equally manipulated by the fact that Mister Sunstein calls a book he edited himself, “relevant”. Who is he to decide what I find relevant? Will I feel misled if I find the book not to be relevant at all, and consider myself a victim of manipulation?

Most of all, it’s not like consumers are already seeing through common marketing techniques. The €9.99-trick has been around for quite a long time, and even while effective, consumers are aware of what retailers are trying to achieve here. In the same way, consumers know that it’s probably not “the best insurance”, “the smoothest soft drink”, or “the most efficient service” in the literal sense, and that marketers sell their goods the same way online as they would on an old-fashioned market place. And we’re not going after a salesman pitching his “best apples” on a marketplace, are we? In the example of the “best” apple, the salesman certainly caught your attention with his pitch, that is far from making the sale. Just thinking of all the heavily marketed products that we personally DON’T want should be proof of that.

In the same way, technological progress is uncircumventable through marketing. There is no scenario in which candlemakers market their way out of being replaced by electricity as a form of producing light. Do you buy things that you’ll find limited need for? Surely. Erroneous market decisions are a recurring theme, and nobody pretends that consumers act perfectly. If we’re willing to admit the imperfection of consumers, let’s not pretend that centralized decisions on consumer behaviour are exempt from mistakes themselves.

This is particularly true when it comes to nutrition. The food pyramid that was preached for decades was put completely upside down through new scientific findings.

Denise Minger writes in her book Death By Food Pyramid about Louise Light’s commissioned review of the 1956 food pyramid in the United States, which was ultimately rejected: “The guide Light and her team worked so hard to assemble came back a mangled, lopsided perversion of its former self. The recommended grain servings had nearly quadrupled, exploding to form America’s dietary centerpiece: six to eleven servings of grains per day replaced Light’s recommended two to three… and rather than aggressively lowering sugar consumption as Light’s team strived to do, the new guidelines told Americans to choose a diet “moderate in sugar,” with no explanation of what that hazy phrase actually meant.”

Centralized authorities make mistakes when it comes to nutritional recommendations. The claim that advertising is brainwashing us and that bureaucrats know the way out is essentially the wrong approach.

Improvements can always be made, but they have to be made through education, not blatant bans on access to information.

Let me formulate that in a way that fits the closeness of the European elections next months: if consumers are so ill-informed that they cannot even refrain from buying food as soon as they see advertising for it, then why are they fit to elect parliamentarians who legislate these advertisements away?

Originally published on https://www.eureporter.co/frontpage/2019/04/03/what-advertisingbans-get-wrong-about-consumerbehaviour/

About Bill Wirtz

Bill Wirtz is policy analyst for the Consumer Choice Center, based in Brussels, Belgium. Originally from Luxembourg, his articles have appeared across the world in English, French, German, and Luxembourgish. He is Editor-in-Chief of Speak Freely, the blog of European Students for Liberty, a contributing editor for the Freedom Today Network and a regular contributor for the Foundation for Economic Education (FEE). He blogs regularly on his website in four languages.

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