Ethics and Global Marketing Lecture three: Ethics and Delivering Customer Value across Global Markets.

Ethics and Global Marketing

Lecture three:

Ethics and Delivering Customer Value across Global Markets

Business perspective three:

• Intents, means and ends– When formulating marketing campaigns,

marketers are responsible for:• The intent of the action• The means or method by which the practice was

implemented• The end or outcomes of the strategy or tactic

Did Hyundai go too far?

The proportionality framework

• Adapted from Garrett (1966)– The principle of proportionality:

• Marketers are responsible for whatever they intend as a means or an end. If both are 'good', they may act, accepting a certain (i.e. minor) risk of side effects.

The marketing concept

• Segmentation• Targeting• Positioning

High price

Low price

Narrow range

Wide range

Tesco

Marks & Spencer

Harrods

Market stalls

Convenience stores

Delicatessens

Discount stores

Marketing mix

• Product

• Price

• Place

• People

• Physical evidence

• Process

• Promotion

Vaseline example

Ethical product challenges

Ethical pricing challenges

Ethical pricing challenges

Ethical place challenges

• Whose responsibility?

• The government and the retailers?

• http://www.bbc.co.uk/news/uk-politics-21388628

• Individuals?

• http://www.bbc.co.uk/news/uk-21392004

• The supply chain?

• http://www.bbc.co.uk/news/uk-21394451

Ethical people challenges

Non-ethical physical evidence

• Fake bomb detectors:

• http://www.bbc.co.uk/news/uk-22279095

Ethical promotional challenges

CUSTOMER

PROVIDER

Word-of-mouthcommunications Personal needs Past experience

Expected service

Perceived service

Servicedelivery

Service qualityspecifications

Management perceptionsof customer expectations

Externalcommunications to

customers

Gap 5

Gap 4

Gap 1

Gap 3

Gap 2

Service Quality Framework

ABC model of consumer attitudes

• Affect• Behaviour • Cognition

Purchase decision making framework

Essential components of culture

• Beliefs– Mental and verbal processes that reflect our

knowledge and assessment of products/services.

• Values– Indicators consumers use as guides for what is

appropriate behaviour. – Usually enduring and widely accepted within the

market.

Essential components of culture

• Customs– Overt modes of behaviour that constitute

culturally approved or acceptable ways of behaving in specific situations.

– Customs are evident at major events in one’s life, e.g. birth, marriage, death, and at key events in the year, e.g. Christmas, Easter, Ramadan.

Layers of culture

• Like an onion (Lee and Carter, 2012)– National culture– Business culture– Organisational culture– Individual culture

Layers of culture

• Hofstede (2003)– National level– Regional / ethnic / religious / linguistic affiliation

level– Gender level– Generation level– Social class level

Contextual continuum of culture

SwissGermans

ScandinaviansNorth Americans

English

Italians/Spanish

Latin Americans

Arabs

Japanese

Low

Context

High

ImplicitExplicit Messages

French

Source: Usiner et al (2005))

Hofstede’s criteria (2001)• Individualism

– Affects the way people live together• Power distance

– Dealing with human inequality• Uncertainty avoidance

– Managing future uncertainty• Masculinity

– Male / female stereotyping• Time orientation/Confucian dynamism

– Long-term or short-term orientation

Danish Culture – According to Geert Hofstede

Source: www.geert-hofstede.com

Very low power distanceQuite high individualismVery low ”masculinity” – more ”feminine” valuesVery low uncertainty avoidance

Business culture traits: - Quite informal, relaxed - Punctuality is very important- A very direct, no-nonsense communication (may be considered rude)- High gender equality- Not too flashy dress-code

In a European context the Danish culture differs from being more ”feminine” and with a very low power distance compared to other European countries. But in a global context the contrasts are even bigger.

This can be risky in dealing with e.g. China.

A viral marketing campaign gone horribly wrong…

side 26

Self-reference criterion• The process of gaining empathy within an international

country market requires:• Cultural empathy

– The ability to place yourself in the position of a buyer from another country.

• Neutrality– The ability to identify the differences that exist without making

value judgements about ‘better’ or ‘worse’ cultures.– The focus should be placed on differences rather than superiority.

Assumptions to be questioned by international marketing managers

• The consumer buying process is consistent across cultures– consumer involvement– perceived risk– cognitive style

Cultural tightness-looseness

• Refers to the extent to which an individual shows strong adherence to social norms and whether severe sanctions are imposed on those who deviate from these norms.

(Gelfand, Nishii, and Raver, 2006)

Ethics and Global Marketing

Lecture three:

Ethics and Delivering Customer Value across Global Markets

Tutor: Giovanna Battiston

[email protected]

ActivityCongratulations! You have just graduated from university and you have been offered an interview with Starbucks for a position as Marketing Officer at their head office in the US.

To prepare for the interview you have been asked to deliver a 20-minute presentation in response to the following question:

'Evaluate the reasons why Starbucks has been unsuccessful in demonstrating its ethical and environmental credentials and outline the marketing measures the company could undertake to increase awareness of its CSR activities.'