KOLKATA, DEC 15   :   The Advertising Standards Council of India (ASCI) has updated its guidelines for ‘Qualification of Brand Extension-products
and services’ under the restricted category prohibited from advertising by law, official sources said on Friday.

These modifications have been detailed in Chapter III Clause 3.6 (a) of the ASCI code, and specifically target brand extensions associated with restricted categories
such as liquor and tobacco.

While ASCI had in place specific guidelines for brand extension, which were modified a few months back, it was felt necessary to further strengthen these in View of mega-budget celebrity campaigns during high-profile sporting events in India. ASCI’s current guidelines provide for brand

extensions to cross certain thresholds of business, investment, or distribution criteria for them
to be considered genuine extensions. ASCI has now added specific criteria also for advertising
spends about turnover of the said extension.

The report said the advertising spends have to be in proportion to the sales turnover of extension: ASCI has mandated that the advertising budget for genuine brand extensions of restricted master brands has to be commensurate with the extension’s sales turnover. The proportions for the ad budgets are capped at 200 percent (ie. not more than 200 percent) of the turnover in the first two years of the launch of the extension, followed by 100 percent (ie. not more than 100 percent) of

revenue in the third year, 50 percent in the fourth year, and 30 percent thereafter. The advertising budget includes media expenditure across all forms of media in the previous 12 months, payments to

celebrities for brand endorsements on an annualised basis, and theannual average money spent on advertising production for the brand extension in the previous three years.

This measure will ensure a balanced approach to advertising investment in alignment with the extension’s sales performance over time. Treatment of Variants Under Brand Extension: For clarity, any variants launched under the brand extension will not be considered as a fresh extension. The original date of the first brand extension will apply. Certification by Reputed CA Firms: To ensure genuine compliance, all evidence supporting the brand extension’s qualifications for

advertising must be certified by a reputed and independent CA firm. If a brand extension of a parent brand that is under one of the restricted categories doesn’t meet the updated qualifications, ASCI will

not consider it to be a genuine extension, but a surrogate created to advertise a restricted category. ASCI’s updates will contribute to maintaining the integrity of advertising in India, upholding ethical
standards, and protecting consumers from misleading practices.

Throwing more light on the amendment to the fresh changes to the Brand Extension Guidelines, Manisha Kapoor, CEO and Secretary General, ASCI, said, “As part of our ongoing commitment to consumer protection and ethical advertising, ASCI has introduced these new additions to the

Brand Extension Guidelines. These measures are essential to prevent the misuse of brand extensions as surrogates for advertising in restricted categories. We believe that these guidelines will
strengthen the integrity of advertising in the industry.”(UNI)