Advertising Must Advertise
By ENO( H POWELL, MP
WI-I m ‘A., liN my generation carne out of the war into politics in 1945-46, laisser-faire was a very dirty word indeed. If anyone threw it at the Con- servative Party we whipped it smartly back again, like a hand grenade with the pin out. In the present Prime Minister's speeches of those years there was a passage which kept coming over and over again and which seemed better every lime we heard it—about how the Conservative Party in the nineteenth century was confronted by the 'clever people' who knew how to improve the world, and how the Conservatives said, 'But it can't be right that women and little children,' etc., and how the 'clever people' (the laisser-faire Liberals) retorted in a superior way, 'Ah, but you don't understand about these things : . it will all Come right,' etc. No one would claim that laisser-faire is yet a suitable inscription for the judiciously blank banner under which the Tory lion advances to V for vict,ry. But few also would dispute that over the last twelve or thirteen years laisser-faire has grown much less offensive. What with show- ing that 'Conservative freedom works' and with making 'the customer always right' once again. and what with One Nation announcing that 'Change is our Ally,' a lot of people in a lot of places have been rediscovering uses and even beauties in the laws of supply and demand.
The reassuring picture of Conservative politics in the nineteenth century no longer escapes criticism; voices ask whether the real guilt (if any) of the. Conservative Party between the wars was not its addiction to rationalisation; and Members who forced reluctant governments to denationalise steel and road transport, to break the BBC monopoly and to end the Supplies and Services Acts, look around and wonder what to be after next. Nor are there lacking those who not only answer in the affirmative, but are prepared to argue—if you allow them three-quarters of an hour cold—that laisser-faire has its rightful place near the centre of the Tory Party's 'organic con- cept' of the nation and society.
Just at this moment comes the current debate on advertising, to put the question and divide the Ayes from the Noes; for a man's attitude to advertising is the acid test of whether he really believes in the free economy, the sovereignty of the consumer and all the rest.
There is no free economy nor consumer's sovereignty without a market. In the modern. world there is no market without advertising. From packaging and window display, through all the gradations of personal and printed appeal, to the coveted peak-hour 'spots on television— advertisement ceaselessly creates and re-creates markets, the indispensable setting of all free economic action, the bringing of the choice's to the attention of the dhooser. Mark well those who suspect advertising or would curb or limit it : they are those who have no faith in economic freedom or would end it. A study of advertising just published* puts the matter in an epigram:
The coin that has the sovereign consumer on one side carries the image of the salesman on the other. Salesmanship, both commercial and political, is universally practi' J in free societies and distinguishes them from tyrannies, where personal choice. again both commercial and political, is confined to taking or leaving what suits those in control.
The market which advertising helps to create in modern conditions is imperfect—as every other market in real life has been since the world began. At some moments the very success of an adver- tising campaign for a particular brand may even make the market more imperfect. But the process is self-correcting. Advertising creates no mono- poly where it is not already present, and a true monopoly has no need to advertise. The con- tinuous presentation to the public of alternative brands, and indeed of alternative satisfactions. re-
* ADVER'l ISING IN A FREI: SOCIE iv. By Ralph Harris and Arthur Seldon. (Institute a Economic Affairs, 18s.) forms the pattern of the market before it has time to harden: if an antidote is needed to adver- tising we have it ready to hand—in more adver- tising. It is no accident that in markets where a few giant firms are being challenged by smaller firms it is the advertising appropriations of the latter which are much the larger in proportion.
`But how wasteful to spend millions of pounds on pushing at us alternative, bin almost identical, articles, one of which we should be bound to buy anyhow, and perhaps cheaper if the adver- tisements had not to be paid for!' This is the gravamen, no doubt, of the case against, but so pitted with errors and fallacies that it is hard to know where to begin. • Selling, like conveying, is an integral part of production. The hand or brain which brings the existence or availability of an article to the atten- tion of the consumer is as useful as those which fabricate it in the factory or transport the raw materials. In the process which ends with the consumer's satisfaction there is no logical break. The better the existence and the availability of the things the consumer wants are made known to him, the more satisfaction he will get from his resources, because the more informed will be his choice. Indeed, a rising standard of living implies that ever new wants are being called into consciousness and then enabled to be satisfied.
Certainly, if only one article of each kind were brought to the attention of consumers, less would need 4o be expended on this element in the process of production. But the consequences are easy to predict and unpleasant to contemplate: variety would diminish instead of constantly increasing, improvements (especially if small or gradual) Would be discouraged, innovation would be at a discount, competition within the one commodity would disappear and prices—would they really be likely to fall?
There is waste in advertising; of course there is. There is also waste in transport, in assembly, in fabrication, in every aspect of production; nor will it, in the nature of things, ever be eliminated entirely. The practical question is how best we can keep it down towards the minimum —the minimum, that is, consistent with advertis- ing performing its function. The answer is, by '1 tell you live theatre is on the way out!' giving the advertiser every incentive to get value from his expenditure. High taxation, here as with all costs of production, is a strong disincentive: the Chancellor, as the saying goes, pays for half. But let no one jump to the conclusion that adver- tising should therefore be treated specially for tax purposes. The costs of bringing the product to the attention of the purchaser, in whatever way, are costs undertaken in order to earn the profit which is taxed. It is no function of the tax system to interfere with the commercial judgment of the profitmaker and by disallowing some kinds of costs or by picking and choosing between them to decide ex cathedra what pays and what does not. If high taxation makes for waste in business costs, the remedy pretty clearly lies elsewhere.
Above all, a sense of proportion is called for, and it is useful to remember such facts as that the advertising costs of Shell and Esso represent less than id. per gallon, or that the aggregate of the expenditure on all forms of advertising in Britain probably does not amount to much more than 5d. in the £ of consumer expenditure.
Advertising, like all other salesmanship, is persuasion. In business or in politics it is not the duty of the persuader to provide, even if he could, an academically complete and accurate statement of all conceivably relevant facts. He would never persuade if he did; and as long as he has no monopoly of persuasion, the dangers are remote and negligible in comparison with the benefits. This is not a defence of falsehood or deception. The same public which has a right to be allowed to choose between alternatives commended to it by competing interests has also a right to be protected against bad faith and against informa- tion dangerously wrong or defective.
The necessary control of advertising for this purpose, both by statute and by custom, affords no ground for those who would control it because they fear or dislike the 'market which could not exist if it were hampered or suppressed. To claim that a market should be honest is the opposite to demanding that it should be closed.
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