190 Supplemental Case 1: Great State Wheat Flakes Can’t Be Beat
SUPPLEMENTAL CASE 1
Great State Wheat Flakes Can’t Be Beat*
Betty, who has been employed for three years as a copywriter for HK&M, a small advertising agency
specializing in consumer packaged goods, has been feverishly working for the past week on a new ad
campaign for Great State Wheat Flakes, a regionally-distributed breakfast cereal. The agency has
worked with this account for several years. Although Charlie, the brand manager on this cereal, has
been pleased with the agency’s work, he feels that the old positioning, which stressed taste attributes
and fun-filled family breakfasts, has become tired and dated. Marketing research shows a high degree
of consumer wear-out—people are bored, even annoyed, with the campaign and are ready for
something fresh. Betty’s task is to rejuvenate the brand by repositioning it to take advantage of, and tie
into, the health and well-being trend, specifically the current interest in physical fitness and eating
“good-for-you” food. The brand was to be pitched as an important part of an active, healthy lifestyle.
Betty tried to tell Charlie that this was misleading because it implies that Great State’s brand is healthier
than most, if not all, of the other brands. In reality, all wheat flake cereals are parity products—they are
virtual photocopies of each other in terms of taste, texture, and, most importantly, composition and
nutritional value. In fact, studies had shown that between 70 and 80 percent of consumers could not
identify their favorite brand of wheat flakes in blind taste tests and that loyalty levels were low. This
means that, with price incentives, consumers would switch brands readily. Charlie, obviously irritated,
explained that his tag line was a perfectly acceptable exaggeration—what the advertising trade termed
“puffery”—and that consumers see through it. He felt that it offered the point of difference needed to
increase brand loyalty.
Supplemental Case 1: Great State Wheat Flakes Can’t Be Beat 191
truly better than their competitors. Betty, recalling several other such implied superiority claims she had
recently seen, realized that it was, indeed, a popular technique.
Betty thought that Steve’s comment might, indeed, have some merit. In fact, she feared that it might
force Great State’s competitors to improve and differentiate their cereals, thereby benefiting consumers
(but harming Great State). Nonetheless, she still felt uneasy. It seemed to her that the “implied
superiority” claim crossed the boundary between puffery and deception.
QUESTIONS FOR DISCUSSION
1. Identify the ethical issues facing Betty regarding the nature of the proposed “implied superiority”
advertising claim.
2. What are the ethical issues Betty encounters with respect to organizational relationships and
conflicts?
3. What are Betty’s possible decision alternatives, and what are the ethics of each alternative?
4. Which alternative would you recommend to Betty, and why?
ANSWERS TO QUESTIONS FOR DISCUSSION
1. Some issues and suggested “talking points” raised or suggested by the characters in the case to
discuss the “implied superiority” advertising claim follow.
Are implied superiority claims like the given examples in the case as misleading or
deceptive as Betty believes, or are they merely honest exaggeration (“puffery”) which
consumers will see through, as Charlie suggests? Where should one draw the line between
192 Supplemental Case 1: Great State Wheat Flakes Can’t Be Beat
Because implied superiority claims are commonly used by commodity brands, as Steve
notes, (perhaps by Great State’s competitors too) does that make them acceptable? A
common fallacy is that something is acceptable simply because many people engage in it.
Relativists (also known as situation ethicists) would say that morality can be determined by
what the majority believes or by what many others are doing.
Because puffery and implied superiority claims are legal, does that make them ethical? The
legality argument raised by Steve is another common fallacy in ethical reasoning. Civil laws
reflect a general consensus of what society believes is morally right. Laws can be deemed
immoral and can change over time and place. Generally, the law provides a moral minimum.
Thus, although the FTC allows puffery and implied superiority claims, this is not sufficient
justification for their use.
2. This cases raises several organizational issues. Chapter 7 notes that personal-organizational ethical
conflict occurs when the values and norms taught through the socialization process contradict an
employee’s personal values. Situations in which going along with coworkers and managers might
conflict with an individual’s moral standards are not uncommon in business, creating a source of
ethical dilemmas. Significant others are the most influential variable impacting ethical decisions
in business.
Here, Betty is the conflicted employee who needs to decide whether her goals and values or those
3. At one extreme, Betty could always opt to quit her job. Although quitting might be an ethical
choice which could lead to increased feelings of self-esteem from doing the right thing even at a
Supplemental Case 1: Great State Wheat Flakes Can’t Be Beat 193
personal cost, it might not be feasible, especially if Betty is helping to support a family, the job
market is tight, she has student loans to pay back, etc.
At the other extreme, Betty could adopt Charlie’s implied superiority claim. While this allows her
to keep her job and might be a demonstration of loyalty to her supervisor and the client, it
4. Answers will vary based on individual perspective and choice.