Marketers’ Ethics & Social Responsibility Flashcards
Ethics VS Legality
Ethics: determined by morals
Legality: determined by law
- Legal + Unethical: Unpaid Internships
- Legal + Ethical: Sustainable Marketing
- Unethical + Illegal: Insider Trading
- Ethical + Illegal: The Avengers
Marketing Philosophies
Consumer Needs (N) + Business Needs (N):
- Marketing Concept
Consumers Needs (N) + Business Needs (F):
- Strategic Planning Concept
Consumer Needs (F) + Business Needs (N):
- Societal Marketing Concept
Consumers Needs (F) + Business Needs (F):
- Sustainable Marketing Concept
Sustainable Marketing Concept
Calls for societal and environmental responsibilities that both meet the immediate and future needs of companies while preserving consumer welfare and wellbeing
Market Risk
- Vegan & Green Products (Higher Price)
Operating Risk
- Increased cost
- Research inputs
- Communication costs
- Less competitive advantage
Corporate Image Risk
- Green wash: company uses deceptive ways to lead to an incorrect impression that their products are environmentally friendly
Societal Criticism Of Marketing
- High prices
- Excessive markups
- Price discrimination
- Deceptive practices
- Deceptive pricing
- Packaging
- False/Misleading Ads
- Planned/perceived obsolescence
- Bad services to poor consumers
- Materialism
Marketing Ethics
Moral principles designed to guide marketers’ behavior
- Unethical marketing negatively affects consumer decision making.
Privacy Issues
- Using Wi-Fi signals from smartphones to track consumers in stores.
- Smartphones can be used to learn who you are and what you purchase.
- Smart TVs use software that collects information about what a consumer is watching on a second-by-second basis.
Privacy Laws
The Federal Trade Commission (FTC) proposed legislation that would . . .
- give consumers access to information collected about them.
- let consumers choose whether they want their Internet browsing and buying habits monitored.
AdLock allows consumers to block ads from specific sites.
- Prior research suggests that many Americans do not want to be tracked.
Vulnerable Segments
Marketers must take special care in advertising to children.
- kids spend a lot of time on online and viewing TV.
Marketers spend at least $10 billion annually on promoting foods and beverages to America’s children.
- Lawmakers have called for legislation regulating food advertising to children.
Food deserts: geographic areas where access to affordable, healthy food options is limited or nonexistent because grocery stores are too far away.
The nation’s poor areas have 30 percent fewer supermarkets than affluent areas do
Poor communities are forced to shop in small, expensive stores with primarily unhealthy food (high calorie!!!)
Encouraging Overspending
Cold grocery stores
- Makes people hungrier.
Moving in-store displays to encourage wandering
- The longer you stay, the more you buy.
Targeting online shoppers who have been drinking
- They are likely to spend more freely.
Granting easy credit
- Teenagers and college students are likely to spend unwisely.
- Especially those high on impulsiveness and materialism.
Camouflaged Advertising
Native Advertising: consumers can be unaware that they are even watching a paid advertisement.
- Product placements in television shows or movies.
- Advertorials are found in print media.
- Infomercials are commonly found on television and often look like documentaries.
False/Misleading Advertising
Puffery (“brand X is the best”)
Truth-in-advertising laws protect consumers from false advertisements.
The FTC has developed guidelines as to what constitutes deceptive advertising
- misleading claims.
The FTC can also require companies that have misled consumers through their advertising to run corrective advertising.
- retractions or clarifications.
Pharmaceutical Marketing
Three major categories of promotional violations:
- Unsubstantiated effectiveness claims (e.g., drug as more effective than available evidence suggests).
- Omitted risk information (e.g., failure to present information on side effects).
- Unsubstantiated superiority claims (e.g., falsely presenting the drug as more effective than others).
Promoting Socially Beneficial Causes
Many not-for-profit organizations promote socially beneficial behaviors.
- contributing to charity
- using energy responsibly
- reducing unhealthy behaviors (e.g., drug use)
Many companies try to increase their credibility by being “good corporate citizens.”
- They integrate socially desirable practices into their operations.
Dishonest Behavior in the Marketplace
Many stores charge restocking fees, limit return policies, and track abnormal return patterns.
- In response to buyers who buy items, use them, and then return them for a refund.
In the digital world, software piracy is a major problem.
