Covert marketing unmasked: A legal and regulatory guide for practices that mask marketing messages

Journal of Public Policy and Marketing

Volumn 27, Issue 1, 2008, Pages 7-18

  Petty, Ross D ^a   Craig Andrews, J ^b  

^a BABSON COLLEGE   (United States)

^b MARQUETTE UNIVERSITY   (United States)

Author keywords

Advertising; Covert marketing; Deception; Federal trade commission; Information disclosure

Indexed keywords

EID: 45449114860     PISSN: 07439156     EISSN: 15477207     Source Type: Journal    
DOI: 10.1509/jppm.27.1.7     Document Type: Review

References (92)

1. A.A. Friedman Co. (1968), 74 F.T.C. 1056.
2. Abelson, Jenn (2005), "The Offer's in the Mail," Boston Sunday Globe, (June 12), A1, A25.
3. Adelstein, Jonathan S. (2005), '"Fresh Is Not as Fresh as Frozen': A Response to the Commercialization of American Media," remarks before the American Media Institute, (May 25), (accessed October 25, 2007), [available at http://hraunfoss.fcc. gov/edocs_public/attachmatch/DOC-258962A1.pdf].
4. Andrews, J. Craig and Thomas J. Maronick (1995), "Advertising Research Issues from FTC Versus Stouffer Foods Corporation," Journal of Public Policy & Marketing, 14 (Fall), 301-309.
5. Associated Press (2005), "Sneaking Ads into Games," (accessed November 14, 2005), [available at http://www.wired.com/news/ business/0,1367,69498.00.html].
6. Balasubramanian, Siva K. (1994), "Beyond Advertising and Publicity: Hybrid Messages and Public Policy Issues," Journal of Advertising, 23 (4), 29-46.
7. James A. Karrh, and Hermant Patwardhan (2006), "Audience Response to Product Placements: An Integrative Framework and Future Research Agenda," Journal of Advertising, 35 (3), 115-41.
8. Bandler, James (2005), "Advice for Sale: How Companies Pay TV Experts for On-Air Product Mentions," The Wall Street Journal, (April 19), A1.
9. Bearden, William O., Richard G. Netemeyer, and Jess E. Teel (1989), "Measurement of Consumer Susceptibility of Interpersonal Influence," Journal of Consumer Research, 15 (March), 473-81.
10. Bonzai.com Software (2001), NAD Case No. 3797C (October 7).
11. Braswell, A. Glen, et al. (2006), (U.S. District Court, Central District of California, Western Division) FTC Settlement and Final Order, FTC Matter No. X030059, Civil Action No. CV 03-3700-DT (PJWx), (January 30).
12. Brookfield Communications v. West Coast Entertainment Corporation (1999), 174 F.3d 1036-1066 (9th Cir.).
13. Broyles, Sheri F. (2006), "Misplaced Marketing: Misplaced Paranoia over Subliminal Advertising: What's the Big Uproar This Time?" Journal of Consumer Marketing, 23 (6), 312-13.
14. Cain, Rita Marie (1996), "Recent Developments in Telemarketing Regulation," Journal of Public Policy & Marketing, 15 (Spring), 135-41.
15. (1994), "Call Up Someone and Just Say Buy: Telemarketing and the Regulatory Environment," American Business Law Journal, 31 (4), 641-98.
16. Calfee John and Debra Ringold (1994), "The Seventy Percent Majority: Enduring Consumer Beliefs About Advertising," Journal of Public Policy & Marketing, 13 (Fall), 228-38.
17. Campbell, Angela J. (2006), "Restricting the Marketing of Junk Food to Children by Product Placement and Character Selling," Loyola of Los Angeles Law Review, 39 (1), 447-506.
18. Carl, Walter J., Jr. (2006), "To Tell of Not to Tell? Assessing the Practical Effects of Disclosure for Word-of-Mouth Marketing Agents and Their Conversational Partners," summary report, (accessed October 25, 2007), [available at http://www. waltercarl.neu.edu/downloads].
19. Churchill, Gilbert A., Jr., and George P. Moschis (1979), "Television and Interpersonal Influences in Adolescent Consumer Learning," Journal of Consumer Research, 6 (June), 23-35.
20. Collins, Clayton (2004), "Lines Blur Between Ads and Articles," Christian Science Monitor, (May 27), (accessed October 19, 2004), [available at http://www.csmonitor.com/2004/0527/ p11s02-ussc.htm].
21. Comcast Corp. (2007), FCC No. DA 07-4005, (September 21).
22. Commercial Alert (2003a), "Complaint, Request for Investigation, and Petition for Rulemaking to Establish Adequate Disclosure of Product Placement on Television," submitted to the Federal Communications Commission, (September 30), 1-12.
23. (2003b), "Request for Investigation of Product Placement on Television and for Guidelines to Require Adequate Disclosure of TV Product Placement," submitted to the Federal Trade Commission, (September 30), 1-17.
24. (2005), "Request for Investigation of Companies That Engage in 'Buzz Marketing,'" submitted to the Federal Trade Commission, (October 18), 1-6.
25. Cooga Mooga Inc. (1978), 92 F.T.C. 310, order modified, 98 F.T.C. 814 (1981).
26. Creamer, Matthew (2005), "Foul Mouth: Stealth Marketers Flirt with Law," Advertising Age, (October 3), 6.
27. Cyr, Diane (1999), "Sweeps Saga: PCH and AFP Plan for Future in the Wake of Public Uproar," Direct, (September 30), (accessed April 21, 2005), [available at http://www.directmag. com/mag/marketing_sweeps_saga_pch/].
28. Darke, Peter R. and Robin J.B. Ritchie (2007), "The Defensive Consumer: Advertising Deception, Defensive Processing, and Distrust," Journal of Marketing Research, 44 (February), 114-27.
29. Davis Furnace Co. (1961), 59 F.T.C. 583.
30. Direct Marketing Association (2005), "Economic Impact: U.S. Direct Marketing Today," (accessed October 25, 2007), [available at http://www.the-dma.org/cgi/registered/research/ libres-ecoimp2003.shtml].
31. Dobele, Angela, David Toleman, and Michael Beverland (2005), "Controlled Infection! Spreading the Brand Message Through Viral Marketing," Business Horizons, 48 (2), 143-49.
32. Encyclopaedia Britannica, Inc. v. FTC (1979), 605 F.2d 964 (7th Cir.), cert. denied, 445 U.S. 934 (1980).
33. Enright, Allison (2005), "Stats: To Your Places Everyone," Marketing News, (July 15), 4.
34. Ford, Gary T. and John E. Calfee (1986), "Recent Developments in FTC Policy on Deception," Journal of Marketing, 50 (July), 82-103.
35. Friestad, Marian and Peter Wright (1994), "The Persuasion Knowledge Model: How People Cope with Persuasion Attempts," Journal of Consumer Research, 21 (1), 1-31.
36. FTC (1983), "FTC Policy Statement on Deception," appended to Cliffdale Associates, Inc., 103 F.T.C. 110, 174 (1984), (accessed December 1, 2006), [available at http://www.ftc.gov/ bcp/policystmt/ad-decept. htm].
37. (1984), "Policy Statement on Unfairness," appended to International Harvester Co., 104 F.T.C. 949, 1070 (1984), (accessed October 25, 2007), [available at http://www.ftc.gov/ bcp/policystmt/ad-unfair. htm].
38. (2002), Re: Commercial Alert complaint, "Requesting Investigation of Various Internet Search Engine Companies for Paid Placement and Paid Inclusion Programs," (June 27), (accessed December 19, 2006), [available at http://www.ftc. gov/os/closings/staff/commercialalertattatch.htm].
39. (2005) Re: Commercial Alert petition, "Request for Investigation of Product Placement on Television and for Guidelines to Require Adequate Disclosure of TV Product Placement," (February 10), (accessed December 19, 2006), [available at http://www.ftc.gov/os/closings/staff/050210productplacemen. pdf].
40. (2006) Re: Commercial Alert petition, "Request for Investigation of Companies That Engage in 'Buzz Marketing,'" (December 7), (accessed December 19, 2006), [available at http://www.ftc.gov/os/closings/staff/ 061211staffopinionto commercialalert.pdf].
41. FTC v. Direct Marketing Concepts Inc. (2004), No. 04-CV-11136-GAO (D. Mass.) (complaint filed June 3, 2004; preliminary injunction granted June 23, 2004), (accessed October 25, 2007), [available at http://www.ftc.gov/os/ caselist/0233138/ 0233138.htm].
42. FTC v. Standard Education Society (1937), 302 U.S. 112.
43. FTC v. Window Rock Enterprises Inc. et al. (2004), No. CV04-8190 DSF (JTLx) (C.D. Cal.) (complaint and stipulated interim agreement and order filed September 30, 2004), (accessed October 25, 2007), [available at http://www.ftc.gov/os/caselist/ windowrock/windowrock.shtm].
44. Georgetown Publishing House Ltd. Inc. (1996), 122 F.T.C. 392.
45. Gogoi, Pallavi (2006), "Wal-Mart's Jim and Laura, the Real Story," BusinessWeek, (October 6), (accessed December 5, 2006), [available at http://www.businessweek.com/bwdaily/ dnflash/content/oct2006/ db20061009_579137.htm].
46. Goodman, Ellen P. (2007), "Peer Promotions and False Advertising Law," South Carolina Law Review, 58 (Summer), 683-707.
47. Gynex Corp. v. Dilex Inst, of Feminine Hygiene (1936), 85 F.2d 103 (2d Cir.).
48. Hammond, John S., Ralph L. Keeney, and Howard Raiffa (2006), "The Hidden Traps in Decision Making," Harvard Business Review, 84 (1), 118-26. (Reprinted from 76 [5], 47-58 [1998].)
49. Holland Furnace Co. (1958), 55 F.T.C. 55.
50. Horowitz, Bruce (2005), "P&G Buzz Marketing Unit Hit with Complaint," USA Today, (October 19), 1B.
51. Hoy, Mariea Grubbs and J. Craig Andrews (2004), "Adherence of Prime-Time Televised Advertising Disclosures to the 'Clear and Conspicuous' Standard: 1990 Versus 2002," Journal of Public Policy & Marketing, 23 (Fall), 170-82.
52. James R. Wyatt (1993), 118 F.T.C. 117.
53. Joffe v. Acacia Mortgage Corp. (2005), 121 P.3d 831 (Ct. of App. Az. Div. 1, Depart. E).
54. JS&A Group Inc. (1989), 111 F.T.C. 529.
55. Kaikati, Andrew M. and Jack G. Kaikati (2004), "Stealth Marketing: How to Reach Consumers Surreptitiously," California Management Review, 46 (4), 6-22.
56. Kertz, Consuelo Lauda and Roobina Ohanian (1991), "Recent Trends in the Law of Endorsement Advertising: Infomercials, Celebrity Endorsers and Nontraditional Defendants in Deceptive Advertising Cases," Hofstra Law Review, 19 (3), 603-656.
57. Khermouch, Gerry and Jeff Green (2001), "Buzz Marketing," BusinessWeek, (July 30), 50-57.
58. Kisielius, Jolita and Brian Sternthal (1987), "Examining the Vividness Controversy: An Availability-Valence Interpretation," Journal of Consumer Research, 12 (4), 418-31.
59. Kopytoff, Verne (2002), "Sites Told to 'Fess Up,'" San Francisco Chronicle, (June 29), B1.
60. La Pastina, Antonio C. (2001), "Product Placement in Brazilian Prime Time Television: The Case of the Reception of a Telenovela," Journal of Broadcasting and Electronic Media, 45 (Fall), 541-57.
61. Lindstrom, Martin (2005), Brand Sense: Build Powerful Brands Through Touch, Taste, Smell, Sight and Sound. New York: The Free Press.
62. Marketing News (2007), "Viral Marketing Outlook III," (October 15), 6.
63. Maronick, Thomas J. (1990), "Copy Tests in FTC Deception Cases: Guidelines for Researchers," Journal of Advertising Research, 31 (December), 9-17.
64. Media Arts Int'l Ltd. v. Trillium Health Products (1992), 25 U.S. P.Q. 2d 1764 (E.D. Pa.).
65. Mega Systems, Int'l, Inc. (1998), 1998 FTC LEXIS 207.
66. Menin, Bruce (2005), "Here's Looking at You, Kids," Campaign for a Commercial-Free Childhood, (March 18), (accessed October 26, 2007), [available at http://www.commercialexploitation. org/news/articles/hereslooking. htm].
67. Mitchell, Andrew A. and Jerry C. Olson (1981), "Are Product Attribute Beliefs the Only Mediator of Advertising Effects on Brand Attitude?" Journal of Marketing Research, 18 (August), 318-32.
68. Moore, Elizabeth S. and Victoria J. Rideout (2007), "The Online Marketing of Food to Children: Is It Just Fun and Games?" Journal of Public Policy & Marketing, 26 (Fall), 202-220.
69. Moore, Timothy E. (1982), "Subliminal Advertising: What You See Is What You Get," Journal of Marketing, 46 (Spring), 38-47.
70. National Housewares, Inc. (1977), 90 F.T.C. 512.
71. Nelson, M.R. (2002), "Recall of Brand Placements in Computer/ Video Games," Journal of Advertising Research, 42 (2), 80-92.
72. Nielsen (2007), "Word-of-Mouth the Most Powerful Selling Tool: Nielsen Global Survey," (accessed October 26, 2007), [available at http://www.nielsen.com/media/2007/pr_071001.html].
73. Obermiller, Carl and Eric R. Spangenberg (2000), "On the Origin and Distinctness of Skepticism Toward Advertising," Marketing Letters, 11 (4), 311-22.
74. Douglas L. MacLachlan (2005), "Ad Skepticism: The Consequences of Disbelief," Journal of Advertising, 34(3), 7-18.
75. Petty, Richard E. and John T. Cacioppo (1986), Communication and Persuasion: Central and Peripheral Routes to Attitude Change. New York: Springer-Verlag.
76. Petty, Ross D. (1992), The Impact of Advertising Law on Business and Public Policy. Westport, CT: Quorum Books.
77. (2003), "Wireless Advertising Messaging: Legal Analysis and Public Policy Issues," Journal of Public Policy & Marketing, 22 (Spring), 71-83.
78. Phillips, Lynn W. and Brian Sternthal (1977), "Age Differences in Information Processing: A Perspective on the Aged Consumer," Journal of Marketing Research, 14 (November), 444-57.
79. Pringle, Hamish (2004), Celebrity Sells. West Sussex, UK: John Wiley & Sons.
80. Roehm, Michelle L., Harper A. Roehm Jr., and Derrick S. Boone (2004), "Plugs Versus Placements: A Comparison of Alternatives for Within Program Brand Exposure," Psychology & Marketing, 21 (1), 17-28.
81. Rothman, Jennifer E. (2005), "Initial Interest Confusion: Standing at the Crossroads of Trademark Law," Cardozo Law Review, 27 (October), 105-191.
82. Russell, Cristel Antonia and Barbara B. Stern (2006), "Consumers, Characters, and Products: A Balance Model of Sitcom Product Placement Effects," Journal of Advertising, 35 (1), 7-21.
83. Shimp, Terence A. (2007), Advertising, Promotion, and Other Aspects of Integrated Marketing Communications. Mason, OH: Thomson/South-Western.
84. Minutes (2004), "Undercover Marketing Exposed," (July 25), (accessed June 19, 2006), [available at http://www.cbsnews. com/stories/2003/10/23/60minutes/printable579657.shtml].
85. Steinberg, Brian and James Bandler (2004), "Blurring the Line? Magazines Face New Pressure as Marketers Seek to Blend Advertisers with Content," The Wall Street Journal, (August 9), B1.
86. Sutton, Richard C. and Barbara Zack (2006), Best Practices in Branded Entertainment: Case Studies and Accountability. New York: Association of National Advertisers.
87. Synchronal Corporation (1994), FTC Docket No. 9251 (February 3).
88. Taylor, Charles R. and Steven W. Kopp (1991), "Games, Contests, and Sweepstakes Run Afoul: A State of Legal Disorder," Journal of Public Policy & Marketing, 10 (Spring), 199-213.
89. Teinowitz, Ira (2005), "CARU Targets Product Placement and Cartoon Ads," Advertising Age, (September 16), [available at http://www.adage.com].
90. United States v. Reader's Digest Association (1981), 662 F.2d 955 (3d Cir.), cert. denied, 455 U.S. 908 (1982).
91. Vranica, Suzanne (2005), "Trends: Advertising; Anywhere, Anytime," The Wall Street Journal, (November 21), R6.
92. Walker, Rob (2004), "The Hidden (in Plain Sight) Persuaders," The New York Times, (December 5), 69.