What are the History, Laws, Profitability and Social Responab

WHAT ARE THE HISTORY, LAWS, PROFITABILITY, AND RESPONSIBILITES TO THE CONSUMER OF ADVERTISING HARD LIQUOR ON TV IN THE UNITED STATES?

INTRODUCTION

Purpose

The goal of this report is to inform the reader of the recent events that prompted hard liquor advertising on TV. In addition, the laws associated with advertising across this media, as well as recent legislative endeavors to control such advertising. Furthermore, the report also focuses on the potential profitability the distilled spirit\'s industry will gain from advertising across this media and the industries social responsibilities to the consumer.

Sources and Methods

Research for this report is gathered mainly from information found on the World Wide Web. Some information was gained through newspaper articles obtained by using the InfoTrac system in the Ruth Scarborough Library on the Shepherd College Campus. Refer to the bibliography for specific information references.

History

Research by the Distilled Spirits Council of the United States (DISCUS) found that 30 to 50 percent of Americans think that distilled spirits are being advertised on TV. Since Prohibition the hard liquor industry voluntarily agreed not to advertise their products, first on radio in 1936, and of TV in 1948. However, the industry is being faced with declining sales. Their competitors such as the beer and wine industries have grown. The sales of beer and wine have increased dramatically, leaving the hard liquor industry behind. The main reason for this occurrence is due to the fact that these industries have tapped into the resource of advertising on TV.

Consequently, this has prompted the hard liquor industry to reevaluate its current marketing situation. The first company to take the leap to TV is Seagram. The Seagram company began advertising 30-second Crown Royal whiskey commercials in Corpus Christi, Texas.



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Definitions

The words "distilled spirit" is used throughout this report. Distilled spirits and hard liquor in this report have the same meaning. Distill means to let fall, exude, or precipitate in drops or in a wet mist according to Webster\'s Dictionary. Hard liquor is the end result of this process using the appropriate ingredients. Distilled spirit is any alcoholic beverage not defined as beer or wine.

Laws

Constitutional

The right to advertise is constitutionally protected commercial free speech under the First Amendment. This fact is being upheld in a recent commercial free speech decision by the Supreme Court. The case of 44 Liquormart, Inc. vs. Rhode Island upholds the industry\'s commercial free speech rights by insuring that beverage alcohol is allowed the same protection under the First Amendment as other legal products and services.

In addition, the Courts also ruled that truthful and non-misleading advertising is an essential part of the free enterprise system. Withholding this form of advertising deprives the consumers of knowledge that is needed to make conscious and informed decisions.

Federal Regulations

Advertising hard liquor on TV is a constitutionally protected right, however, the industry must follow strict Federal regulations. An advertisement of distilled spirits can not contain any false or misleading statement that tends to create a misleading impression of the product to the consumer. Furthermore, a statement in an advertisement cannot say anything bad about a competitor\'s product. Provisions are made also for a statement\'s design that cannot contain any material that is obscene or indecent.

Federal regulations do not permit claims of distilled spirits having curative or therapeutic qualities. This practice was very popular in the 1800\'s and early 1900\'s. Traveling salespersons would often stage a show in the middle of small towns claiming a miracle cure for various sicknesses. Most often, the cure would involve alcohol consumption causing the consumer to become intoxicated. This advertising was false and misleading.

Flags, seals, coats of arms, crests, and other insignias which can be capable of relating to the American flag or a branch of the armed forces is strictly prohibited. The advertisement can not mislead the consumer into thinking that the product is endorsed, made, used by, or produced for any of the government, organizations, or families these insignias are associated.


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The use of deceptive advertising techniques such as subliminal techniques are also
prohibited under federal regulations. Subliminal techniques refer to any advertising technique that attempts to convey a message to a person by means of images or sounds that are very brief. These messages usually cannot be perceived at a normal level of awareness according