Advertising FAQ
The Iowa Newspaper Association is happy to provide answers to your frequently asked questions about advertising with our statewide network of media members.
When Customized Newspaper Advertising makes sales calls to advertisers and their agencies, who chooses the papers and how are they chosen?
CNA never goes into a sales presentation with any pre-conceived notion of which newspapers should be included in the final proposal to the advertiser. Rather, the CNA Account Executive learns everything he/she can about that advertiser, its target market, its demographic market, its budget, its goals, etc. and makes a recommendation based on that information. The advertiser always determines the markets. For example, it we are making a presentation to an advertising agency representing an auto dealer association group in a given DMA (designated market area), we will initially propose every newspaper in the DMA or every newspaper market that has a dealer (of the given manufacturer-Ford, Chevy, etc.) in the DMA. The agency will determine the final markets in which it will advertise, not CNA. It will generally make that determination based on its target market and its budget. It is CNA’s hope that by moving dollars from broadcast to print, it can begin to make progress toward adding additional markets and securing more advertising for all Iowa newspapers.
CNA is almost always selling to advertising agencies. When sales budget targets are developed, the Sales & Marketing Director begins by determining the two-year sales history for all accounts and identifying those representing 80 percent of all CNA sales during that period. Each of these accounts is then consulted to determine its anticipated budget for the coming year. Some accounts are able to provide a lot of helpful information, others very little. The staff then identifies those accounts planning to substantially increase, reduce or eliminate their newspaper advertising budgets in the upcoming year. The resultant change in dollar volume is then either added or subtracted from the projected sales for the current year. Other factors considered include: newspaper rate increases (estimated based on a survey of newspapers); increased staff experience and the potential for new business.
When I Print Advertising Inserts For A Customer, Do I Charge Sales Tax?
According to INA Legal Hotline attorneys, it depends on how the insert flyers will be used. There is no sales tax on insert flyers to be inserted in newspapers or shoppers. But sales tax would apply on insert flyers that will be distributed by direct mail or handed out in stores. The only exception would be if a newspaper acts as a wholesaler, printing insert flyers for an ad agency on behalf of a client who plans to distribute them via direct mail or in stores. In that case, the sales tax would be charged to the client by the ad agency, not the newspaper serving as the wholesaler.
Does An Ad Running In Our Newspaper Belong To Our Newspaper Or The Advertiser?
According to INA Legal Hotline attorneys, absent a contract or compensation for the creative work done on the ad, ownership is with the paper.
Should My Newspaper Adopt A Fair Housing Policy?
Each newspaper should adopt a policy statement. The statement should be approved by the highest-ranking officer (usually the publisher) of the newspaper. A copy of the statement along with a cover letter explaining the newspaper’s commitment to adherence of the Fair Housing Act should be distributed to the newspaper’s employees. A sample policy statement follows: FAIR HOUSING LAWS: “The Federal Fair Housing Act prohibits discrimination in the sale, rental, leasing and financing of housing, as well as discriminatory advertising, on the basis of RACE, SEX, COLOR, RELIGION, NATIONAL ORIGIN, MENTAL or PHYSICAL HANDICAP, or FAMILIAL STATUS. (Our local jurisdictions also have specific applicable regulations.)
“These laws cover any potential or actual sale, lease, rental, eviction, price, terms, privileges or any service in relation to the sale of or use of housing. They not only prohibit advertisements which clearly restrict access to housing based on the protected categories, but also prohibit advertisements which indicate a preference for or against a person based on a protected category. In particular circumstances, use of colloquialisms, symbols or directions to real estate for sale or tent may indicate a discriminatory preference.
“It is the intent and goal of this newspaper to have each advertiser who wishes to place a covered advertisement in the newspaper comply with the Fair Housing laws. Any advertisement which is perceived to contain language contrary to these laws will be rejected or changed to remove the offending reference. There may be situations where it is not clear whether particular language is objectionable. Such advertisements should be referred to a supervisor for consideration and determination. Under certain circumstances, advertisers may claim that because of the nature of the housing being advertised, they are not subject to the Fair Housing laws. Such claims are irrelevant for purposes of considering advertisements for publication in this newspaper. Every housing advertisement published in this newspaper is subject to the Fair Housing laws.”
Can Newspapers Be Held Liable For Real Estate Advertising?
Anyone who makes, prints or publishes advertisements (or causes them to be made, printed or published) needs to be concerned about housing discrimination. This definition includes all advertising and media, i.e. broadcast, brochures, billboards, direct mail, flyers, newspapers, poster, shoppers, etc. This provision extends to prohibit the use of discriminatory words, phrases, photographs, illustrations, symbols or forms. The Department of Housing and Urban Development, which investigates complaints, takes the position that newspapers face civil suits if they publish advertisements that encourage discrimination (or even indicate a preference) relative to protected classes.
You might wonder if the Fair Housing Act and regulations hinders free speech as espoused in the First Amendment of the U.S. Constitution. The answer is NO. There is a distinction between free public speech and commercial speech. Advertisements are commercial speech and, thus, are subject to regulation. Newspapers are not in the practice of accepting advertisements for anything illegal, such as prostitution, stolen property or illegal drugs. Because discrimination is against the law, newspapers cannot accept ads that discriminate.
In order for newspapers to comply with all of the Fair Housing Act and regulations, publishers of housing advertisements should do the following:
– provide a printed copy of their nondiscrimination policy to each employee and officer;
– post copies of the policy in conspicuous locations in their businesses;
– make copies available in their businesses;
– include a Fair Housing notice at the beginning of the real estate advertising section;
– avoid referring to the kinds of people who might live in or buy a particular dwelling in advertisements.
Can Advertisers Run An Ad That Uses The Phrase "March Madness?"
The words “Final Four” and “March Madness” are among the National Collegiate Athletic Association’s list of registered trademarks. The unauthorized use of these and other words registered by the NCAA could lead to legal action.
In conjunction with its championships, the NCAA has developed licensing and marketing programs that make use of its trademarks and championships marks. Such programs are carefully controlled and aggressively protected to be consistent with the purposes and objectives of the NCAA. Any direct or indirect usage of the NCAA’s championships, tickets or marks/logos (including references to the name of the NCAA championship) requires prior written consent of the NCAA and its corporate marketing staff.
Federal regulations support the NCAA’s efforts to prohibit the unauthorized use of the NCAA’s name and trademarks, or any use of NCAA championship tickets in sweepstakes, promotions or contests or any other unfair attempt to associate with or exploit the goodwill of the NCAA championship event.
A merchant selling products that have already been licensed by the NCAA to official corporate partners or merchandise licensees can promote the sale of these items in advertising, provided the appropriate wording is used, and the advertising is submitted by the NCAA corporate partner to the NCAA corporate marketing staff for approval.
Can An Advertiser Run An Ad With A Picture Of A Pack Of Cigarettes?
According to the INA’s Legal Hotline attorneys, at one time, the FDA had written regulations on this topic. However, a subsequent U.S. Supreme Court decision ruled that the FDA did not have the authority to impose such rules, so they became moot.
After a large group of states sued a group of tobacco companies about promotion aimed at young people, all sides agreed to a master settlement agreement. That agreement limits what a cigarette manufacturer may do in advertising but does not affect a merchant selling cigarettes since the merchant was not a party in the lawsuit.
So, there would be nothing prohibiting a merchant from running such an ad. The attorney recommends that the Surgeon’s General warning be included in the ad. While there is no guidance in the master settlement agreement regarding the minimum type size of the warning, the words “SURGEON GENERAL’S WARNING” should be in all caps.
Can We Use An Illustration Of An American Flag In An Ad?
The U.S. Code says the U.S. flag should never be used for any advertising purposes in any manner whatsoever.”
A New York Court of Appeals case said that this federal law is “not intended to prescribe behavior, but it is an extension of prevalent customs, and thus the provisions are not to be accorded the full weight of statutory prohibition.”
So, you may run into trouble if you use a flag to sell merchandise or services. But if you are showing the flag as an illustration to sell a flag kit or flag poles, you’re probably all right.
The NNA’s handbook “Federal Laws Affecting Newspapers” has this to say on the subject: “While the language of a federal statute would indicate that the flag may not be used in any ads whatsoever, at least one court has held that the provisions are not to be accorded the full weight of a statutory enforce this prohibition.”