To curb misleading ads, Centre issues new guidelines - What it means for celebrity endorsers

It is no secret that a large portion of consumers across the globe rely on advertisements to make choices of what products or services to buy and which ones to avoid.

In fact, a study in 2019 assessed and analysed the effect of advertisements on various dimensions of consumer behaviour-awareness, interest, conviction, purchase and post-purchase behaviour, concluded that “TV and internet advertisements are affecting awareness, intention and conviction stages of consumer behaviour. Magazines are more effective in influencing the purchase and post-purchase stages; newspapers are the only medium which affected all the stages of consumer behaviour.”

Owing to the proven hold of advertisements on consumers, the government on June 10 released the ‘Guidelines on Prevention of Misleading Advertisements and Endorsements for Misleading Advertisements, 2022’ to protect consumer rights and customers from such advertisements. The new guidelines have been notified under the Consumer Protection Act, which lay rules for celebrity endorsements. Surrogate advertisements have been prohibited, and fresh rules govern ads involving children and children’s products.

What are bait and surrogate advertisements?

Bait advertisements are tactics used to attract more customers by offering goods, services and products at lower rates. Surrogate advertisements, on the other hand, are used for advertising products of brands when the original product cannot be advertised on mass media.

Guidelines concerning children’s products

The regulations specify that commercials involving children or child-related items must not promote a poor body image in children or give the sense that the product is superior to the natural or traditional meals that the child may be eating.

“Guidelines forbid advertisements from exaggerating the features of a product or service in such manner as to lead children to have unrealistic expectations of such product or service and claim any health or nutritional claims or benefits without being adequately and scientifically substantiated by a recognized body.”, reads the statement.

What do the new guidelines mean for celebrity endorsers?

As per the new guidelines released by the Consumer Affairs Ministry issued on Friday, endorsements must reflect the honest opinions, belief or experience of endorsers.

The endorsers have to make material connection disclosures, failing to do so will attract penalty under the Consumer Protection Act (CPA).

Material disclosures means any relationship that materially affects the weight or credibility of any endorsement that a reasonable consumer would not expect.

"If there exists a connection between the endorser and the trader, manufacturer or advertiser of the endorsed product that might materially affect the value or credibility of the endorsement and the connection is not reasonably expected by the audience, such connection shall be fully disclosed in making the endorsement," the guidelines said.

Violation of these guidelines will attract a penalty of Rs 10 lakh for first offence and Rs 50 lakh for subsequent offence, under the Consumer Protection Act.

Celebrity endorsements have, in the recent past, been under heavy scrutiny and criticism. From Yami Gautam and Shah Rukh Khan promoting Fair and Lovely and Fair and Handsome, to Aishwarya Rai Bachchan's Kalyan Jewellers ad being labelled as racist, and Amitabh Bachchan hurling stones at a mango tree for the Kacha Mango Bite ad, there is no dearth of celebrity advertisements being misleading.

With PTI inputs.