MARKETING ETHICS

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L E A R N I N G O B J E C T I V E S

MARKETING ETHICS

Why do marketers have to worry about ethics?

What does it take for a firm to be considered socially responsible?

How should a firm make ethically responsible decision?

How can ethics and social responsibility be integrated into a firm’s marketing strategy?

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Mattel – Product Safety Crisis

Lead paint from

subcontracted manufacturer

in China

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Firm Goals

Greed and short term profit seeking

Serious long term consequences

Creating value over the long run Long term success

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The Scope of Marketing Ethics

Business Ethics Marketing Ethics

Miller Commercial

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Attitudes About the Ethical Standards of Various Professions

Why do you feel marketers (advertising practitioners) rank so low on this scale?

What can marketers do to improve their ranking?

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Citibank Addresses Identity Theft

Why is this a good customer issue to address?

Why are these ads effective?

Citibank Commercial

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Creating an Ethical Climate in the Workplace

Values– Establish– Share– Understand

Rules– Management

commitment– Employee

dedication Controls

– Reward– Punishment

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American Marketing Association Code of Ethics

Generally accepted code in marketing

Flows from general norms of conduct to specific valuesSubareas within marketing have their own code of ethics to deal with specific issues

AMA Website

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The Influence of Personal Ethics

Genetics Family

Religion Values

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Why People Act Unethically

Are all the individuals who engage in questionable

behavior just plain immoral or unethical?

What makes people take actions that create so much

harm?

Decisions often have conflicting outcomes, where both options have positive and negative

consequences

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Competing Outcomes

Dangerous flaw in new model

Delay production

Delayed revenue

Possible layoffs

Loss of bonuses

Continue production

Potential injury to consumers

Loss of revenue

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The Link Between Ethics and Corporate Social Responsibility

Firms should implement programs that are socially responsible

Employees should act in an ethically responsible manner

Build-A-Bear Workshop

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A Framework for Ethical Decision Making

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Step One: Identify Issues

Marketing research firm

issuesData

collection methods

Using results to mislead or even harm the public

Hiding the real purpose of the study

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Step Two: Gather Information and Identify Stakeholders

Identify all ethical issues and relevant legal information

Identify all relevant stakeholders and get their input on any identified ethical issues

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Stakeholder Analysis Matrix for a Marketing Research Firm

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Step Three: Brainstorm Alternatives

Halt the market research project?

Make responses anonymous?

Instituting training on the AMA Code of Ethics for all researchers

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Step Four: Choose a Course of Action

Weigh the alternatives

Take a course of action

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Ethical Decision-Making Evaluation Questionnaire

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Check Yourself

1. According to the American marketing Association Code of Ethics, what are the six ethical values

2. Identify the four stages in the ethical decision making framework

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Integrating Ethics Into Marketing Strategy

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Planning Phase

The mission or vision statement sets the overall ethical tone for planning.

Firms often go beyond the mission or vision statement by including a values statement.

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Donating over $200 million since 1982

Newman’s Own

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Implementation Stage

Aqua Teen Hunger Force LED display was

mistaken as a bomb Secret Sparkle Body

Spray Sold through retailer

that targets 7-14 year olds although packaging claimed to keep out of reach of children

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Implementation Phase

Should the firm be targeting this market with this product?

Should the firm be selling its product in this market in this

manner?

Should the firm be relocating production to another country?

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Control Phase

1. Check successful

implementation2. React to

change

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The Six Tests of Ethical Action

•Would I want to see this in the media?The Publicity Test

•Would the person I admire the most do this?The Moral Mentor Test

•Would I want the person I admire the most to SEE me doing this?

The Admired Observer Test

•Could I give a clear explanation for the actionThe Transparency Test

•Would I be able to look in the mirror and respect myselfThe Person in the Mirror Test

•Would I like to be on the receiving end of this action?The Golden Rule Test

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Check Yourself

1. Should a marketing manager insist on assessing the ethics of a situation she or he is facing?

2. Identify one ethical issue you might face in each of the three phases of a marketing plan

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Understanding Ethics Using Scenarios

Scenario 1: R.J. Reynolds: Promotions to YouthScenario 2: Victoria’s Dirty SecretScenario 3: Pregnant Teen TV StarScenario 4: Who Is on the Line?Scenario 5: West Virginia T-Shirts Scenario 6: Giving Credit Where Credit Isn’t DueScenario 7: The Jeweler’s Tarnished ImageScenario 8: No Wonder It’s So GoodScenario 9: Bright Baby’s Bright IdeaScenario 10: Money from Mailing ListsScenario 11: The Blogging CEO

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Scenario 1: R.J. Reynolds

What are the ethical issues Mailings to young

adults Candy flavored

cigarettes Is it wrong? Why

or why not?Back to list of scenarios

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Scenario 2: Victoria’s Dirty Secret

What was Victoria’s Secret doing?

Was it wrong? Unethical How could they fix

this?

Back to list of scenarios

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Scenario 3: Pregnant Teen TV Star

Should the show be cancelled?

Should the pregnancy be written into the script?

How should Nickelodeon handle this?

Is there any way this could be helpful?Back to list of scenarios

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Scenario 4: Who Is on the Line?

What are the ethical issues in this scenario?

Why would a firm use this service?

How do you think consumers will respond to firms who use this service?

Would you advise purchasing this service?

Back to list of scenarios

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Scenario 5: West Virginia T-Shirts

What are the ethical issues in this scenario?

If you were the retailer how would you have responded?

Does a history of previous inappropriate business practices impact your opinion of the retailer?

Back to list of scenarios

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Scenario 6: Giving Credit Where Credit Isn’t Due

Is this an inappropriate target market?

Could you argue that the firm provides a valuable service to this market?

Would you advise the cataloger to pursue this new strategy?

Back to list of scenarios

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Scenario 7: The Jeweler’s Tarnished Image

Is the manufacturer responsible for the acts of independent sales people?

How do you feel the Billing’s should respond?

Back to list of scenarios

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Scenario 8: No Wonder It’s So Good

Is the legal non disclosure of the alcohol content and ethical issue?

Should the firm be required to disclose the alcohol content?

What would you do if you were Mia?

Relax with Enjoy Cola

Back to list of scenarios

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Scenario 9: Bright Baby’s Bright Idea

Is the potential for injury enough to merit removal of the product from the market?

Do you feel it is ethical to move the product to a less regulated market?

What would you have advised the CEO?Back to list of scenarios

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Scenario 10: Money from Mailing Lists

Should Mangold continue to use the Marketing Metrix mailing list?

Should he tell his new customers how he got their names?

Do customers need to give consent before companies collect information on their online behavior?

Back to list of scenarios

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Scenario 11: The Blogging CEO

Should Burdick be allowed to praise his company anonymously?

Should he be allowed to attack his competitors?

How would you feel if you knew a blogger had personal interests in the topic?Back to list of scenarios

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GlossaryCorporate social responsibility

describes the voluntary actions taken by a company to address the ethical, social, and environmental impacts of its business operations and the concerns of its stakeholders.

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