India, already known for its prohibition on direct liquor advertising, is set to implement a new set of regulations that will further crackdown on misleading liquor ads by banning surrogate advertisements and event sponsorships. This significant policy shift is expected to compel major companies, including Carlsberg, Pernod Ricard, and Diageo, to revise their marketing strategies dramatically.
Stricter Controls on Surrogate Advertising
The new regulations address a common loophole in the current advertising ban—surrogate advertisements. These ads often promote seemingly unrelated products such as water, music CDs, or glassware, but use logos and design elements closely associated with alcoholic beverages. The practice allows companies to indirectly promote their liquor brands while complying with the letter of the law. The Supreme Court’s latest move aims to eliminate such misleading liquor ads by explicitly targeting these indirect promotional strategies.
For example, Carlsberg’s Tuborg drinking water campaign, featuring film stars at a rooftop dance party with the slogan “Tilt Your World,” mirrors its beer advertisements. Similarly, Diageo’s YouTube ad for its Black and White ginger ale, featuring the iconic black-and-white terriers from its scotch brand, exemplifies how liquor brands use secondary products to maintain brand visibility. These tactics, deemed misleading liquor ads, will now face stricter scrutiny under the new rules.
The new regulations, as reported by Reuters, will impose fines and endorsement bans on companies and celebrities involved in these misleading liquor ads. Nidhi Khare, a leading civil servant in consumer affairs, emphasized that both companies and endorsers will be held accountable for any surrogate or misleading advertisements. The regulations include penalties of up to 5 million rupees ($60,000) for manufacturers and endorsers, with endorsement bans ranging from one to three years. Khare stressed the importance of eliminating circuitous promotional methods, stating, “You can’t take a circuitous way to promote products.”
Impact on the Liquor Market and Public Health Considerations
India, the world’s eighth-largest alcohol market by volume, with annual revenues estimated at $45 billion, is likely to experience significant shifts due to these regulations. The new rules could have far-reaching effects on liquor manufacturers, particularly as the market becomes increasingly attractive with the country’s growing affluence. Major players like United Breweries, which holds over a quarter of the market share by volume, and global giants Diageo and Pernod Ricard, will need to adapt their marketing strategies to comply with the new guidelines.
The World Health Organization (WHO) supports such regulations, noting that comprehensive restrictions on alcohol advertising are effective for public health. WHO data suggests that India’s per capita alcohol consumption is projected to rise to nearly 7 liters by 2030, up from about 5 liters in 2019. In contrast, China’s consumption is expected to decrease over the same period. The WHO’s endorsement aligns with India’s move to curb misleading liquor ads, aiming to reduce alcohol-related harm.
India’s draft rules also specifically prohibit marketing items that use similar labels, designs, or logos to those of alcohol products. This aims to close the loophole where ads for items like soda and glassware create brand recall for alcoholic beverages, despite the products themselves being non-alcoholic. The draft regulations are a response to warnings issued to companies like Pernod and domestic tobacco firms about their misleading ads. The focus is on ensuring that brand extension ads accurately represent the product being marketed rather than misleading consumers into thinking the ad is for a liquor brand.
For instance, a video by Pernod promoting glassware products linked to its whisky brand, Blenders Pride, features Bollywood star Alia Bhatt but does not explicitly showcase the glassware. This kind of misleading promotion, which uses similar branding to create a connection with the whisky brand, will be scrutinized under the new regulations.
Overall, the new regulations are poised to create a more transparent advertising landscape, ensuring that marketing practices do not exploit loopholes to promote alcohol indirectly. The Indian government’s decisive action against misleading liquor ads reflects a growing commitment to public health and consumer protection.
You might also be interested in – Liquor to be home-delivered by Swiggy, BigBasket, Zomato soon
