My Memorable Experiences as a Marketing Academic at the Federal Trade Commission

Notre Dame (e-mail: wwilkie@nd.edu). The Background1 I was fortunate to be the first marketing academic to be able to go in-house as a consultant to the Federal Trade Commission’s (FTC’s) Bureau of Consumer Protection (BCP) in June 1972. As I will relate, it was a memorable experience involving a host of activities, one of which was to help start a new FTC Marketing Academic Consultancy program, “Project MAC.” During the ensuing ten years, some 30 marketing academics participated in this program, with considerable impact on both FTC operations and marketing academic thought itself. The program was briefly revived in the early 1990s, giving several more academics the opportunity to move in-house as well. The impetus for marketing academics to join the staff of the FTC can be traced to a sharp change in the political context enveloping the agency in the late 1960s. In accord with general societal unrest accompanying the unpopular war in Vietnam, there was increased questioning of both big business and big government institutions. In addition, there was an impetus for more active regulation of marketers, which originated from a diverse set of institutions and represented a strong set of forces. Prominently, a report by the “Nader’s Raiders” consumerist group harshly criticized the FTC’s low profile during the 1960s (Cox, Fellmeth, and Shultz 1969). Among its allegations, the group pointed out that at this point the FTC was issuing fewer than 70 complaints a year against deceptive promotional practices in the entire country. Cast against the massive promotional activity of the American economy, it was obvious that the chance of detection and prosecution was extremely slim (Pitofsky 1977). President Richard Nixon then requested the prestigious American Bar Association (ABA) to appoint a blueribbon task force to investigate these charges.2 Its detailed report (ABA 1969) provided findings similar to those of Nader’s group, concluding that drastic changes within the agency were needed. If such changes were not made, moreover, the ABA report called for disbanding the entire FTC and assigning its tasks to other agencies. President Nixon and Congress decided to support these changes. The head of the ABA Report, Miles Kirkpatrick, was named FTC Chairman, new appointments were made inside the agency, and the agency’s budget was increased substantially.3 During the following decade, the FTC emphasized new powers and programs. Advertising was a major target: new proposals were advanced on topics such as advertising substantiation (Cohen 1980), corrective advertising (Wilkie, McNeill, and Mazis 1984), comparative advertising (Wilkie and Farris 1975), affirmative disclosure (Wilkie 1982), advertising to children (Mazis 1979; Ratner 1978), and advertising code barriers (e.g., opening more advertising in such areas as eyeglasses, drugs, and other professions). The net effect during the 1970s was to create a much more powerful regulatory agency, supported by a 500% budget increase throughout the decade (Murphy and Wilkie 1990). However, this increase in power and activity sparked a strong backlash from the business community, and the 1980s were marked by restrictions on FTC powers in several regulatory areas (a development I discuss subsequently).