Wednesday, 27 July 2016

Weird beliefs about advertising

A bit of dada free association at the Weighty Matters blog...

Did you hear about the "Cancer Moonshot 2020"?

In their words,
"The Cancer MoonShot 2020 Program is one of the most comprehensive cancer collaborative initiatives launched to date, seeking to accelerate the potential of combination immunotherapy as the next generation standard of care in cancer patients."
And so what's the cost of this ambitious program over the course of the next 5 years?

$1 billion.

Sound impressive?

Maybe less so when you consider that according to AdAge, in 2014 alone, the top 25 US food industry brands spent just shy of 15x that amount advertising their products.

That's a moonshot worth every 3 weeks or so!


What is the reader supposed to conclude from this comparison between two random budgets other than the author is strangely preoccupied by food advertising? What is the connection between a government-funded cancer research programme and the combined marketing budgets of the American food sector?

Perhaps Yoni Freedhof - for it is he - can explain?

If we want to see population level improvements to diet, no doubt that part of the requirement will be food industry advertising reform. Banning advertising that targets kids altogether, reforming front-of-package claims, cracking down on deceit, and more, because with a cancer moonshot of food industry advertising every three weeks, consumers don't stand a chance if we don't. 

No, apparently he can't explain. He might as well be comparing the cost of the Apollo 11 space programme with the price of fish in Tanzania. The two variables have absolutely no relationship to each other.

Why pick out the Cancer Moonshot project? Why not use the USA's $77 billion public health budget as the comparison? Is it because that number is too big to make whatever point Freedhoff is trying to make? Hell, why not take the $3.7 trillion that the federal government spends each year and compare it to the $1.4 billion ad spend of McDonalds? Anything can be made to look small if you put it next to something big.

You see these idiotic comparisons in 'public health' propaganda all the time, although they are usually more coherent than this one. Typically they compare the advertising spend of whatever industry they're going after and compare it to whatever 'public health' budget is supposed to be tackling the associated health issue. Take this from a health select committee, for example...

Better education and information are the main planks of the Government's alcohol strategy. Unfortunately, the evidence is that they are not very effective. Moreover, the low level of Government spending on alcohol information and education campaigns, which amounts to £17.6m in 2009/10 makes it even more unlikely they will have much effect. In contrast, the drinks industry is estimated to spend £600-800m per annum on promoting alcohol.

Note the false dichotomy, as if the drinks industry advertising budget is designed to counter the claims made in government education campaigns. As if a pound spent in a classroom was equal to a pound spent in a commercial. As if alcohol advertising was intended - or was even allowed by law - to encourage people to drink excessively or to tell people that excessive drinking is not bad for your health. As if, as if, as if.

The truth is more mundane. As ample empirical research has shown, much advertising is defensive; it seeks to keep customers loyal to the brand. Most of the rest of it aims to get consumers of other companies' brands to switch. Then there is the small chunk of advertising that announces the appearance of new products.

A lot of advertising therefore cancels itself out, but companies cannot afford to stop advertising because that would give the advantage to their competitors. It's game theory and economists' classical objection to advertising was that it was a waste of resources for this reason, but there is evidence that advertising creates economies of scale and provides other benefits which arguably outweigh that problem.

See Advertising in a Free Society for the details, but my point here is that you can't treat the government's health education budget and an industry's advertising budget as if they were two sides of the same coin, and then pretend that one side is David and the other side is Goliath. And you obviously can't make bizarre comparisons like the one above and pretend that it means anything at all.

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