Well, I suppose that's one loophole.
It isn't as if companies can't hold rallies.
It isn't as if flash mobs don't exist.
And "spreading your message"... what do you think going viral is, exactly?
What is "viral marketing" to you?
Except by tricks "well, you provided free coffee to your volunteers, that's a form of payment, you're all going to jail".
All Advertising is Marketing, but not all Marketing is Advertising.
I think the distinction should be thought of as Marketing (not Advertising) is to inform customers that opt-in to the information. Usually, marketing (excluding the Advertising arm) is for the benefit of a willing participant, where-as Advertising is for the benefit of both the willing participant and also the Advertiser (& advertising media) against an unwitting participant/user.
An example could be a product, company, political candidate's website that has a calendar for upcoming events, information pages about the product, etc. This can include tacky graphics and UI/UX, or even strategic language to stand out and show "personality". What it can not have are advertising boxes for unrelated advertising injections that the user did not go to the website to learn about. That would then be a Marketing site with banned Advertisements. The same for the Marketed product, they can not Advertise on unrelated media; basically inserting itself against the users will (the Advertised product being placed/injected/"forced" upon the person/user).
Look, it's a radical idea and on its face, all at once, is impractical at the moment. So I suggest rather than pointing out the myriad of holes like shooting fish in a barrel, you give it the benefit of the doubt and roll around the ways it could work in your head. And what your online/offline experience would be if it were even 10% effective.
It already is that effective in a lot of the world with stricter advertising laws, and as a Canadian I do find the levels of advertising in the us landscape to be jarring. So there are examples
Strict regulation of ads is one thing, outlawing advertising is another. There are places that don't allow billboards and other street-level advertisement, but that's a long way from outlawing advertisements in general.
I get that it's a nice idea to many, but I follow a general rule of adding extra skepticism if the problems of some approach are absolutely obvious and the response to pointing them out is "don't worry about, that'll sort itself out, let's just do it". Especially when the collateral damage might be huge and the energy feels like "this will save us".