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Ethics and Social Ethics and Social Responsibility in MarketingResponsibility in Marketing
Chapter 3Chapter 3
Ethical Marketing= Ethical Marketing= Oxymoron?Oxymoron?
What are ethics?What are ethics? Ethics are the “moral principles and Ethics are the “moral principles and
values that govern the actions and values that govern the actions and decisions of an individual or group.”decisions of an individual or group.”
Legal v. Ethical StandardsLegal v. Ethical Standards
LawsLaws Standards enforceable by the courtsStandards enforceable by the courts Are laws and ethics the same thing?Are laws and ethics the same thing?
Nike: Illegal? Unethical?Nike: Illegal? Unethical?
Causes for the increasing focus on ethicsCauses for the increasing focus on ethics Diverse value systems within the cultureDiverse value systems within the culture Public groups are more activePublic groups are more active Expectations have increasedExpectations have increased Decrease in ethical behavior?Decrease in ethical behavior?
Influences upon What Is Influences upon What Is EthicalEthical
Societal Culture and NormsSocietal Culture and Norms Business Culture and Industry Business Culture and Industry
PracticesPractices Corporate Culture and ExpectationsCorporate Culture and Expectations
SocietySociety
Societal CultureSocietal Culture Levi StraussLevi Strauss
Societal ValuesSocietal Values PatentsPatents
Source: www.free-stock-illustration.com
BusinessesBusinesses
Business CultureBusiness Culture The rules of the game in interactions The rules of the game in interactions
between buyers and sellers, and between buyers and sellers, and companiescompanies
Ethics of ExchangeEthics of Exchange Caveat EmptorCaveat Emptor Consumer Bill of RightsConsumer Bill of Rights
BusinessesBusinesses
Ethics of Ethics of CompetitionCompetition Economic Economic
espionageespionage Costs businesses in Costs businesses in
US & Canada nearly US & Canada nearly $100 billion each $100 billion each year!year!
BriberyBribery Gifts, favors, etc.Gifts, favors, etc.
Corporate Culture & Corporate Culture & ExpectationsExpectations
Code of EthicsCode of Ethics Formal statement listing what comprises Formal statement listing what comprises
acceptable behavioracceptable behavior Must be very clearMust be very clear Must be equally applied throughout the Must be equally applied throughout the
organizationorganization WhistleblowersWhistleblowers
Ethical TheoriesEthical Theories
Moral idealismMoral idealism Considers certain rights as universalConsiders certain rights as universal
Do no harmDo no harm
UtilitarianismUtilitarianism ““The greatest good for the greatest The greatest good for the greatest
number”number” Deontological TheoriesDeontological Theories
““The ends justify the means”The ends justify the means”
Social ResponsibilitySocial Responsibility
Companies are accountable to Companies are accountable to society or their actionssociety or their actions
Three types:Three types: Profit ResponsibilityProfit Responsibility Stakeholder ResponsibilityStakeholder Responsibility Societal ResponsibilitySocietal Responsibility
EnvironmentEnvironment General PublicGeneral Public
Societal ResponsibilitySocietal Responsibility
EnvironmentEnvironment Green MarketingGreen Marketing ISO 14000ISO 14000
General PublicGeneral Public Cause-Related Cause-Related
MarketingMarketing
Public-Policy IssuesPublic-Policy Issues
Deceptive AdvertisingDeceptive Advertising Advertising to ChildrenAdvertising to Children Telemarketing FraudTelemarketing Fraud
Source: Mower & Minor. “Consumer Behavior: A Source: Mower & Minor. “Consumer Behavior: A Framework.” Prentice-Hall, New Jersey, 2001.Framework.” Prentice-Hall, New Jersey, 2001.
Deceptive AdvertisingDeceptive Advertising
““Literally false or potentially misleading”Literally false or potentially misleading” False statementsFalse statements Misleading Safety ClaimsMisleading Safety Claims
Misleading Affirmative Safety ClaimsMisleading Affirmative Safety Claims Deceptive Denials of Product RiskDeceptive Denials of Product Risk Deceptive Information OmissionsDeceptive Information Omissions Unfair Information OmissionsUnfair Information Omissions
Source: Mower & Minor. “Consumer Behavior: A Framework.” Source: Mower & Minor. “Consumer Behavior: A Framework.” Prentice-Hall, New Jersey, 2001.Prentice-Hall, New Jersey, 2001.
Advertising to ChildrenAdvertising to Children
What’s wrong with it?What’s wrong with it?
Source: www.adstrategy.wordpress.comSource: www.wikipedia.org
Yes, this is real
Telemarketing FraudTelemarketing Fraud
Costs Americans $40 Costs Americans $40 billion per yearbillion per year
Who is at risk?Who is at risk?
Source: Mower & Minor. Source: Mower & Minor. “Consumer Behavior: A “Consumer Behavior: A Framework.” Prentice-Hall, New Framework.” Prentice-Hall, New Jersey, 2001.Jersey, 2001.
Compulsive BehaviorCompulsive Behavior
SmokingSmoking DrinkingDrinking GamblingGambling Compulsive ShoppingCompulsive Shopping
Source: Mower & Minor. “Consumer Behavior: A Framework.” Source: Mower & Minor. “Consumer Behavior: A Framework.” Prentice-Hall, New Jersey, 2001.Prentice-Hall, New Jersey, 2001.
Measuring Ethical ConductMeasuring Ethical Conduct
Social auditSocial audit McDonald’s McDonald’s
Long-term: Sustainable developmentLong-term: Sustainable development
Impact of ethical behavior:Impact of ethical behavior: Word-of-mouthWord-of-mouth Outperform less ethical competitorsOutperform less ethical competitors
Ethical Conduct- ConsumersEthical Conduct- Consumers
Dishonest consumer practicesDishonest consumer practices Billions of dollars lost annuallyBillions of dollars lost annually
Consumers are unwilling to pay Consumers are unwilling to pay higher prices for ecologically safe higher prices for ecologically safe productsproducts
Consumers lack informationConsumers lack information