Ethics and Social Responsibility in Marketing

1
Ethics and Social Responsibility in Marketing

• Chapter 3

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
• Source Mower Minor. Consumer Behavior A
  Framework. Prentice-Hall, New Jersey, 2001.

14
Advertising to Children

• Whats wrong with it?
• Source Mower Minor. Consumer Behavior A
  Framework. Prentice-Hall, New Jersey, 2001.

15
Telemarketing Fraud

• Costs Americans 40 billion per year
• Who is at risk?
• Source Mower Minor. Consumer Behavior A
  Framework. Prentice-Hall, New Jersey, 2001.

16
Compulsive Behavior

• Smoking
• Drinking
• Gambling
• Compulsive Shopping
• Source Mower Minor. Consumer Behavior A
  Framework. Prentice-Hall, New Jersey, 2001.

17
Measuring Ethical Conduct

• Social audit
• McDonalds
• 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