Marketing and Society: Social Responsibility and Marketing Ethics

Chapter 4 PowerPoint slides Express version

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Principles of Marketing, Sixth Canadian Edition

Learning Objectives
After studying this chapter, you should be able to:
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Understand marketings multiple responsibilities, and identify the major social and ethical criticisms of marketing Define consumerism and environmentalism and explain how they affect marketing strategies Describe the principles of socially responsible marketing Explain the role of ethics in marketing

Principles of Marketing, Sixth Canadian Edition

Lessons for Socially Responsible Companies

What you sell is important Be proud to be in business Make a solid commitment to change Focus on two bottom lines Forget the hype

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Source: Thea Singer, Can Business Still Save the World? Inc., April 30, 2001, pp58-71; and MEC website, www.mec.ca

Table 4.1

Principles of Marketing, Sixth Canadian Edition

Marketings Impact on Individual Consumers

High prices:
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High costs of distribution High advertising and promotion costs Excessive markups

Deceptive practices:
Pricing, promotion, packaging, and telephone fraud

High pressure selling Shoddy or unsafe products Planned obsolescence Poor service to disadvantaged consumers

Principles of Marketing, Sixth Canadian Edition

Marketings Impact on Society as a Whole

False wants and too much materialism Too few social goods Cultural pollution Too much political power

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Principles of Marketing, Sixth Canadian Edition

Marketings Impact on Other Businesses

Acquisition of competitors reduces competition Marketing practices create barriers to entry
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High promotional spending Abuse of patent protection

Unfair competitive marketing practices

Predatory pricing Supplier relations

Principles of Marketing, Sixth Canadian Edition

Sellers Versus Consumers Rights

Sellers rights:
To introduce products of different styles and sizes, provided they are not hazardous To set its own prices, provided no discrimination occurs To spend to promote the product To use any product message, provided it is not misleading To use buying incentives
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Consumers rights:
To choose To be informed To safety To be heard To redress To consumer education To participate in marketplace decision making To have access to basic services To a sustainable environment

Principles of Marketing, Sixth Canadian Edition

Environmentalism
Environmentalism:
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An organized movement of concerned citizens and government agencies To protect and improve peoples living environment

Environmental sustainability:
Management approach Develop strategies that both sustain the environment and Produce profits for the company

Principles of Marketing, Sixth Canadian Edition

Socially Responsible Marketing

Enlightened marketing:
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Consumer-oriented marketing Innovative marketing Value marketing Sense-of-mission marketing Societal marketing

Principles of Marketing, Sixth Canadian Edition

Ethical Issues Associated with Marketing Practice Marketing research:

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Invalid or unreliable research studies Invasion of consumer privacy, not respecting confidentiality Disguising sales as research Failure to secure voluntary and informed participation Competitive intelligence gathering

Segmentation/target marketing:
Redlining: discriminating against poor or disadvantaged consumers Targeting inappropriate products to vulnerable audiences
Table 4.2

Principles of Marketing, Sixth Canadian Edition

Ethical Issues Associated with Marketing Practice Positioning:

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Making socially undesirable products more desirable Positioning on questionable benefits

Product:
Marketing unsafe products Product testing: on animals or insufficient testing to reveal safety concerns Marketing socially controversial products

Packaging and labelling:

Actual versus apparent size Misleading or inadequate information Excessive or environmentally-unfriendly packaging

Table 4.2

Principles of Marketing, Sixth Canadian Edition

Ethical Issues Associated with Marketing Practice Pricing:

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Collusion with competitors Negative option billing Prejudice in negotiated prices Price discrimination

Advertising:
Sex role stereotyping Dehumanizing images and portraying people as products Bait-and-switch advertising
Table 4.2

Principles of Marketing, Sixth Canadian Edition

Ethical Issues Associated with Marketing Practice Sales and channel management:
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High pressure sales tactics Unfairly disparaging competitors goods Channel loading

Table 4.2

Principles of Marketing, Sixth Canadian Edition

Some Morally Difficult Situations in Marketing

You are considering hiring a product manager who just left a competitors company. She would be more than happy to tell you all the competitors plans for the coming year. What do you do? You have a chance to win a big account that will mean a lot to you and your company. The purchasing agent hints that a gift would influence the decision. Your assistant recommends sending a fine colour television set to the buyers home. What do you do? You are interviewing a capable woman applicant for a job as a salesperson. She is better qualified than the men just interviewed. Nevertheless, you know that some of your important customers prefer dealing with men, and you will lose some sales if you hire her. What do you do? You are a sales manager in an encyclopedia company. Your competitors salespeople are getting into homes by pretending to take a research survey. After they finish the survey, they switch to their sales pitch. This technique seems to be very effective. What do you do?
Table 4.3

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Principles of Marketing, Sixth Canadian Edition

In Conclusion
The learning objectives for this chapter were:
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4.15

Understand marketings multiple responsibilities and identify the major social and ethical criticisms of marketing Define consumerism and environmentalism and explain how they affect marketing strategies Describe the principles of socially responsible marketing Explain the role of ethics in marketing

Principles of Marketing, Sixth Canadian Edition