Maggi row prompts traders to demand policy on brand endorsement

The row over Maggi has provided an opportunity for the government to formulate a stringent policy for brand endorsement, said the Confederation of All Indian Traders (CAIT).

Himanshu Vatsa | The Dollar Business 

The government must bring a separate policy with a set of guidelines for brand endorsement involving influential personalities as part of promotional campaigns of any product, a traders’ body has said. According to the Confederation of All Indian Traders (CAIT), the row over Nestle’s noodle— Maggi— has provided an opportunity for the government to formulate a stringent policy for brand endorsement. “When there is a mass scale of brand endorsement being done by celebrities, there should be a policy for brand ambassadors in the larger interest of consumers. Several developed countries including the US already have laws to deal with this issue,” said Praveeen Khandelwal, Secretary General of CIAT. Speaking to The Dollar Business, Khandelwal said that the endorsement is the outcome of a legal contract signed between the product manufacturer and the endorser. “Brand ambassadors are not doing any charity. It is a commercial deal and celebrities endorse product in lieu of money. And if the product is harmful for people, they must bear some liability,” he added. Earlier, the Food Safety and Standards Authority of India (FSSAI) tested Maggi and found the popular product unsafe for consumption due to presence of lead and monosodium glutamate (MSG) higher than permissible limit. Authorities also sent notices to Bollywood actors like Amitabh Bachchan, Madhuri Dixit and Preity Zinta who were roped in by Nestle as its brand ambassadors. The actors appeared in print and audio-visual advertisements of the product. Now CAIT has written a letter to the Consumer Affairs Minister Ram Vilas Paswan and demanded action against the actors for promoting Maggi. “The government should either take action against brand ambassadors of Maggi or clarify that they are not responsible for the endorsements they have done so as to end the state of confusion. However, before taking any decision, an opportunity of hearing must be given to us to place our view point based on the feedback we have received from traders,” the traders’ body said in a statement. Khandelwal said, “Since celebrities have greater impact on consumers, there is a need of reasonable prudence and responsible conduct of brand ambassadors to avoid misleading and deceptive endorsements.” In January, the US Food and Drug Administration (USFDA) had also blocked the import of Maggi made in Nestle’s India-based factories. However, Nestle claims that it has tested the product in laboratories within India and abroad and found it safe.  

June 15, 2015 | 06: 49 pm IST.

The Dollar Business Bureau - Jun 15, 2015 12:00 IST