UNIT 4 Flashcards
Business Ethics
A set of rules or guidelines the management or individuals follow to make decisions for their company
Centralized marketing strategy
When a company sells the same product worldwide with few or no modifications to the global brand
Competitive advantage
The ability of a company to produce a product more cheaply than another, or when it has an edge over companies that make similar products
Corporate social responsibility
The duty of a company’s management to work in the best interests of the society it relies on for its resources (human, material, and environmental) to advance the welfare of society, and to act as a good global citizen through its policies
Cultural relativism
The values of different cultures should be respected, as the ethics of one culture are not seen as better than those of another, companies make decision in the context of the cultural values of the countries in which they are doing business
Decentralized marketing strategy
When a company tailors marketing elements specifically to each country
Discretionary income
The amount left after the necessities of life have been paid
Demographics
Are studied by dividing a large market into age, gender, education, marital status, lifestyle and household formation
Ethical imperialism
Certain universal truths or values are standard across all cultures, if something is wrong in one country it is wrong in all countries, includes domestic and international laws, the company’s code of ethics and corporate governance, and the personal values of the individual making the decision
Ethnocentrism
a belief that your own culture, values, beliefs, and customs represent the right way of doing things, and that value systems of other countries are not important.
Marketing
The sum total of all activities involved in getting goods and services from the original producer to the ultimate consumer, includes market research, products development, pricing, advertising and promotion, sales and logistics. The main purpose is to sell the output of production.
Microcredit
The granting of very small loans-often as little as $100 to spur entrepreneurship. Money from private or corporate investors is used to start a small business
Primary stakeholder
Stakeholders that directly affect the company and its profitability. They are of critical importance and their interests should be considered first. Customers, suppliers, competitors, and employees
Resource depletion
Consumption of scarce or non-renewable resources
Stakeholder analysis
Analyzes which stakeholders have the most power and influence in the decision-making process
Subsidizing
Occurs when the importing of a good is helped through financial assistance from the foreign government e.g tax incentives
Sweatshops
Factories in underdeveloped and developing countries where employees work in unsafe environments, are treated unfairly and have no chance to address these conditions
Test of disclosure
“How would we feel if everyone knew about the
decision we made?” If they are not concerned, they
have likely made an ethical decision. If they are
concerned, they have probably not made the right
choice.
Pricing for products sold internationally
Shipping costs, tariffs, exchange rates, insurance, travel costs for employees, lawyers, translations, culture consultants, packaging modifications
Criticisms of corporate social responsibility
Costs companies money, which reduces profit, companies spend valuable time and employee energy on CSR instead they could concentrate on maximizing shareholders wealth, good corporate practices can be used to distract customers from problems a company may be creating, companies may use CSR to enhance their reputation with domestic customers but may not act ethically in other countries
Benefit of corporate social responsibility
Companies use CSR as a marketing tool, dissuades governemnts from implementing regulations that might interfere with businesses, companies can attract and retain excellent employees if they have solid CSR practices
5 Pricing strategies
Penetration pricing, price skimming, premium pricing, discount pricing, psychological pricing
Penetration pricing
entering a market at a lower price than competition
Price skimming
entering a market as a high price during the introductory phase
Premium pricing
setting the price higher than the competition’s price to evoke an illusion of luxury and high quality
Discount pricing
This strategy is often used in a B2B situation where the producer wants to sell high volumes to a wholesaler or retailer
Psychological pricing
setting a price at $199 rather than $200 will sell more product
4 P’S of marketing
Product, place, price promotion
Ways to promote a product or service
Advertising, premiums (free goods offered with a purchase), coupons, point-of-purchasing, contests, personal selling, social media
Ethical imperialism
Ethical imperialism: one set of values for all cultures, right and wrong are the same in all cultures, a person’s ethics are not situational
Cultural relativism: values are dependant on the culture, right and wrong depend on local values, when in Rome do as the Romans do
