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New Regulation, New Rules, New Ethics Simon Rothon Senior Vice President Global Marketing Services Unilever. Unilever Facts. Worldwide sales - €40 billion Employees – c.200,000 Research & Development - €1 billion per annum (Unilever Food and Health Research Institute)
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New Regulation, New Rules, New EthicsSimon RothonSenior Vice President Global Marketing ServicesUnilever
Unilever Facts • Worldwide sales - €40 billion • Employees – c.200,000 • Research & Development - €1 billion per annum (Unilever Food and Health Research Institute) • Manufacturing sites – 337 across six continents • Advertising & Promotion - €5 billion (world’s second largest advertiser)
150 million times a day, in 150 countries, peopleuse our products at key moments of their day
The Media Landscape Then Now
Television • The :30 is Facing Serious Challenges: • Proliferation of Channels • Performance Decline • DVR Penetration
Watershed Moment: October ‘05 Demand for Broadband grows: Penetration clears 50% of all HH’s
Institutions getting Hit Hard: Music Source: New Yorker Conference “2012” – Music
Advertising Self - Regulation • 40 years of compliance with the Advertising Standards Authority code • Now backed by statutory powers • Govern the rules laid down in Codes of Advertising Practice • “Legal, Decent, Honest and Truthful”
Statute Law • Tobacco, alcohol, cars, gaming, financial services, food • Toys, aviation, social networking
UK Stature Law Database 78 pieces of newly enacted legislation up-loaded on August 17th Some examples: • The gaming machine (circumstances of use) regulation 2007 • The national minimum wage regulations 1999 (amendment) • The companies (interest rate for unauthorised political donation or expenditure) regulations 2007 • Public health (aircraft) (amendment) (Wales) regulations 2007
European Framework for Self - Regulation • Major effort from WFA (EASA) to embed self-regulatory framework • In 5 years from 10 to 27 European states participating • Objective is to have self regulation recognised in the law • Need to inform and educate those states where there is little history or tradition of self-regulation
Regulation of New Media • Key principles should still apply • National sanctions not easy to enforce • Option for “rogue” companies to go offshore • Can take action cross-border in Europe but not Feasible further “offshore” • Current initiative through International Chambers of Commerce
Television Without Frontiers Directive Audio Media Services directive • A positive initiative to address the issue • Drafting proving to be a challenge for legislators and stakeholders (six European Parliamentary Committees) • Issues to be resolved by Commission: • Regulation of e-commerce (transactions vs. promotion) • Linear vs. non-linear definition • Global sanctions
Rationale for Self Regulation in New Media • “Goodwill” the major component of brand valuations • New media invite much closer engagement • A stronger imperative to be legal, decent, honest and truthful But.. Issues on “Rogue” traders, fraud and “Mal-ware” can affect legislative environment for legitimate advertisers
Doing Well by Doing Good • Consumer expects high standards of ethics and responsible behaviour from advertisers • Brand equity enhanced by embracing a relevant social cause • Transition from “ideas” to “ideals” • Examples: Dove, Persil, Flora • New media lend themselves to this “interactive” approach
BECELMISSION:TO HELP MAKETHE WORLD’SHEARTS HEALTHIER Becel ad
360 Degree Marketing • Co-invention of content and channels • Identification of all relevant touch points with the consumer • Demands consistency of message tone and manner • Should lend itself to self regulation across all media
Draft Findings of Major European Audit of Compliance with Self Regulatory Codes, July 2007 • 8 country study • 1760 advertisements reviewed • 1707 found to be compliant with Codes of Practice • 53 found to be in breach (3%)
July 2007 Compliance Audit • 940 internet advertisements reviewed (“pop- ups and banners) • None found to be in breach of Codes
Challenges for both Legislation and Self-Regulation Nature of complaint: % • Issue of “taste” across different viewer groups • Need for impartial and objective adjudication
New Media, New Regulation, New Ethics?The Way Forward • Major role of UK in evolving international regulatory framework • UK voluntary codes adopted as basis of European framework • Push for adoption of Global Framework through International Chambers of Commerce (120 countries) • Self-regulation continues to be the optimum approach as “New Media” become “Media” • How do you maintain legislation for an industry which evolves every 3 months?