Table: Major Ethical Issues in Marketing: 4 Ps Model

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ADMN 687 Market Segmentation and Penetration
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Table Major Ethical Issues in Marketing 4 Ps
Model

• Product
• Product Safety.
• Me-toos.
• Product positioning and market segmentation
• Ethics in the delivery of service products
• Environmental impacts of product and packaging.
• Price
• Horizontal/vertical price fixing.
• Price discrimination.
• Predatory pricing.
• Price gouging
• Misleading pricing (e.g., non-unit pricing, bait
  and switch, inflating prices to allow sale
  markdowns).

• Promotion (marketing communications)
• Deceptive/misleading advertising (e.g., sex/race
  stereotypes).
• Questionable sales techniques and conflicts of
  interest in selling.
• Bribery.
• Direct marketing and privacy issues.
• Place (channels of distribution)
• Exclusivity and other forms of discrimination in
  distribution (e.g., red-lining).
• Channel control (including franchising
  relationships).
• Gray marketing
• Anti-competitive trade promotions (e.g., slotting
  allowances).
• Lower standards in export markets.

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Table Laczniaks Framework for Analyzing
Marketing Ethics

• Does action A violate the law?
• Does action A violate any general moral
  obligations
• Duties of fidelity?
• Duties of gratitude?
• Duties of justice?
• Duties of beneficence?
• Duties of self-improvement?
• Duties of nonmaleficence?
• Does action A violate any special obligations
  stemming from the type of marketing organization
  in question (e.g., the special duty of
  pharmaceutical firms to provide safe products)?
• Is the intent of action A evil?
• Are any major evils to result from or because of
  action A?
• Is a satisfactory alternative B, which produces
  equal or more good with less evil than A, being
  knowingly rejected?
• Does action A infringe on the inalienable rights
  of the consumer?
• Does action A leave another person or group less
  well off? Is this person or group already
  relatively underprivileged?

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Figure Marketing Ethics Framework An Ethics
Continuum

• Producer
• interest
• favored.
• Consumer
• interest less
• favored.

• Producer
• interest less
• favored.
• Consumer
• interests
• favored.

Caveat emptor school Profit maximization, subj
ect to legal constraints.
Industry practice In general. The best
companies.
Ethics codes Of individual firms. Of
industries. Of professional bodies (e.g.,
AMA).
Consumer sovereignty school Capability. Informa
tion. Choice.
Caveat venditor school Consumer satisfaction.
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Figure Marketing Framework Consumer
Sovereignty Test

• 1. Capability
• of the consumer.
• 2. Information
• availability and quality.
• 3. Choice
• opportunity to switch.

• Vulnerability factors--age education, income and
  the like.
• Sufficient to judge whether expectations on
  purchase will be fulfilled.
• Level of competition.
• Switching costs