Can Celebrities Take the Responsibility for Erroneous Endorsing?

Celebrity branding has been a time tested campaign mode for the last several decades. Direct endorsement and even surrogate ads create a sense of authenticity for the product. At the same time, there have been several criticisms against these celebrity endorsements. The major allegation was that the celebrities take little responsibility for the quality of the product, whether it is a safety pin, soap, shampoo, beverage or a high end Sports Utility Vehicle. Moreover, they may not be even using the brands they are endorsing. But at the other end, the customers go after the product, blindly attracted to his or her popularity and believing the words of the sports star or film stars in the ad. When we analyze it closely, a certain amount of cheating is involved in these endorsements.

Numerous issues related to celebrity branding have led to a thought of even establishing a censoring mechanism for ads. There have been several law suits in the courts, challenging the quality of products and hollow claims in advertisements.

Do brand ambassadors be made liable for misleading ads? When the company and advertisement agencies are solely responsible for the service/product quality and the ad concept respectively, the celebrities stands as an appropriate medium to promote the concept. A large number of customers tend to blindly believe brands promoted by celebrities, purely out of the emotional bonding with them.  Owing to this reason, the stars cannot runway from their responsibility to these customers. In this scenario, whether stars have to be penalized for the misleading advertisements need to be pondered over by considering every side of the topic. Noting that celebrities honoured with Padma awards are brand ambassadors of several products, the subject has to be well-considered to eradicate this unfavorable inclination in the advertising industry.

Reportedly, the government has said that a Parliamentary Committee’s recommendation of penalties against endorsers of misleading advertisements is under consideration. The Parliamentary Standing Committee on Food, Consumer Affairs and Public Distribution recommends a fine of Rs. 1 million and imprisonment up to two years or both for first time offence and fine of Rs. 5 million and imprisonment for five years for the second time offence for celebrity endorsers.

The crux of all these is that, stringent provisions to tackle misleading advertisements, as well as to fix liability on endorsers/celebrities are soon to be enforced. An execution wing of the government will be entrusted to monitor the credibility of the advertisements as well as it would not be open to a consumer to independently press charges against the ambassador in a court for false and misleading ads. Prior to implementing all these measures, it is very significant for the government to clarify the definitions relating to misleading, false and objectionable advertisements.

 

 

 

 

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Digital Marketing Surges as Traditional Ads Face Brunt of GST

Advertising is a high-demand requisite to promote business growth. Markets use this unique tool to educate customers about the brands. Goods and Services Tax (GST), the revolutionary tax reform, would probably result in major transformations in India’s advertising trends. Advertising agencies that come under the broad umbrella of service sector are liable to pay 18 percent tax for traditional advertising under the GST regime, up 3 percent from the previous rate of 15 percent.

GST has indeed negatively impacted on print and TV advertising in the country.  The brands that are the ultimate benefactors of the service are the obvious payers of this tax. Thus, traditional advertisements have turned out to be an additional expense for several companies.

Every cloud has a silver lining. Thus the burden of extra tax on traditional advertising unlocks the endless opportunities of a much cost effective alternative – digital advertising.  Reportedly, digital advertising which is growing at a fast pace of 14 percent per annum in India has entered the club of $1 billion or above industries.  With the decline of traditional advertising, the overall advertising share of the digital media is expected to double by 2020, means 100 percent more of the Pre-GST era.

As India is celebrating a digital revolution, the nation is expected to have 800 million smartphone users by 2020 and this is likely to catalyse digital advertising in the coming days. Having an edge over TV and print advertising on the basis of more interactive and engaging content, advertising on a digital platform becomes cost effective as well as highly penetrating. Moreover, the unprecedented progress of social media, native advertising, and content marketing on a comparatively low cost is luring both customers and marketers towards digital advertising.

Advertising industry have been facing certain hiccups and teething problems after the rollout of GST. The leading brands have already felt the major drift in the advertising sector. It’s high time for emerging brands to turn into utilizing the seamless opportunities of digital advertising and marketing. In this scenario of extra tax on conventional advertising, digital advertising can play a counterbalancing act as it is equipped with smart and cost effective solutions. In order to rationalize advertising goals, big and medium companies are ready to spend their major chunk of advertising budget for digital advertising, thus opening up new vistas.

NITI Aayog’s PPP project, an excellent slot for private players in health sector

Indian policy think-tank, the National Institution for Transforming India or NITI Aayog, has recently unveiled a grand plan to effectively privatize district hospitals in Tier-I and Tier-II cities. The new strategy is in the light of the realization that the current capacities in public facilities to manage disease conditions in cardiology, pulmonology and oncology are practically insufficient in Tier-I and Tier-II towns. Most civil hospitals in many states are not equipped to effectively address the medical requirements of many non-communicable diseases prevailing in the country. It is understood that the scheme will be initially piloted in states such as Uttar Pradesh, Madhya Pradesh, etc.

The project will be a prospective opportunity for private health service providers who wish to strike a public – private participation or PPP. In this scheme, private partners will be able to cherry-pick the most lucrative districts where patients have a higher paying capacity. Addressing the major financial concern in PPP model, the scheme will also provide an escrow account for private partners that would reduce the risk of delayed reimbursement by the government. Providers would also secure access to utilize all public facilities such as ambulance services, blood banks, mortuaries etc.

In a nut shell, the new initiative of NITI Aayog is government’s solid attempt of handing over public assets to private partners and a clear abdication of the risky duty of providing service where government capacities are totally insufficient. As Health care is primarily a state subject, state governments are expected to soon look into adopting PPP projects in association with respectable private hospitals. Given the large presence in the sector, a well-defined role in the provision of NCD care is welcome but has to be accommodated within a well-designed framework of Universal Health Coverage that integrates pre-paid primary, secondary and tertiary care through a combination of tax funding and social insurance. The proposed PPP model will not only improve the deliverance of appropriate and equitable care to the public but also will prove how the private partners can effectively intervene in reviving the health sector of India.