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Ethics and Social Responsibility in Marketing

Ethics and Social Responsibility in Marketing. Chapter 4. Ethical Marketing= Oxymoron?. What are ethics? Ethics are the “moral principles and values that govern the actions and decisions of an individual or group.”. Legal v. Ethical Standards. Laws Standards enforceable by the courts

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Ethics and Social Responsibility in Marketing

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  1. Ethics and Social Responsibility in Marketing Chapter 4

  2. Ethical Marketing= Oxymoron? • What are ethics? • Ethics are the “moral principles and values that govern the actions and decisions of an individual or group.”

  3. Legal v. Ethical Standards • Laws • Standards enforceable by the courts • Are laws and ethics the same thing? • Nike: Illegal? Unethical? • Causes for the increasing focus on ethics • Diverse value systems within the culture • Public groups are more active • Expectations have increased • Decrease in ethical behavior?

  4. Influences upon What Is Ethical • Societal Culture and Norms • Business Culture and Industry Practices • Corporate Culture and Expectations

  5. Society • Societal Culture • Levi Strauss • Societal Values • Patents

  6. Businesses • Business Culture • The rules of the game in interactions between buyers and sellers, and companies • Ethics of Exchange • Caveat Emptor • Consumer Bill of Rights

  7. Businesses • Ethics of Competition • Economic espionage • Costs businesses in US & Canada nearly $100 billion each year! • Bribery • Gifts, favors, etc.

  8. Corporate Culture & Expectations • Code of Ethics • Formal statement listing what comprises acceptable behavior • Must be very clear • Must be equally applied throughout the organization • Whistleblowers

  9. Ethical Theories • Moral idealism • Considers certain rights as universal • Do no harm • Utilitarianism • “The greatest good for the greatest number” • Deontological Theories • “The ends justify the means”

  10. Social Responsibility • Companies are accountable to society or their actions • Three types: • Profit Responsibility • Stakeholder Responsibility • Societal Responsibility • Environment • General Public

  11. Societal Responsibility • Environment • Green Marketing • ISO 14000 • General Public • Cause-Related Marketing

  12. Public-Policy Issues • Deceptive Advertising • Advertising to Children • Telemarketing Fraud Source: Mower & Minor. “Consumer Behavior: A Framework.” Prentice-Hall, New Jersey, 2001.

  13. Deceptive Advertising • “Literally false or potentially misleading” • False statements • Misleading Safety Claims • Misleading Affirmative Safety Claims • Deceptive Denials of Product Risk • Deceptive Information Omissions • Unfair Information Omissions

  14. Advertising to Children • What’s wrong with it?

  15. Telemarketing Fraud • Costs Americans $40 billion per year • Who is at risk?

  16. Compulsive Behavior • Smoking • Drinking • Gambling • Compulsive Shopping

  17. Measuring Ethical Conduct • Social audit • McDonald’s • Long-term: Sustainable development • Impact of ethical behavior: • Word-of-mouth • Outperform less ethical competitors

  18. Ethical Conduct- Consumers • Dishonest consumer practices • Billions of dollars lost annually • Consumers are unwilling to pay higher prices for ecologically safe products • Consumers lack information

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