ethics in marketing_aniket kulkarni.pptx

Ethics In Marketing By

Ethics In Marketing by

Aniket K. KulkarniRoll No:- MT14IND003Industrial Engineering (2014-15)Mechanical Engg. DepartmentVNIT Nagpur

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WHAT IS ETHICS?It is the art and science of determining good and bad or right and wrong moral behaviour.Ethics are moral guidelines which govern good behaviour. So behaving ethically is doing what is morally right.Behaving ethically in Marketing is widely regarded as good Marketing practice.

Ethics In Marketing Aniket K.Kulkarni2

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An important distinction to remember is that behaving ethically is not quite the same thing as behaving lawfully.

Ethics are about what is right and what is wrong.Law is about what is lawful and what is unlawful. An ethical decision is one that is both legal and meets the shared ethical standards of the community.Ethics In Marketing Aniket K.Kulkarni3

What Is Marketing?Marketing is about identifying and meeting human and social needs.meeting needs profitably.Marketing is the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large (American Marketing Association).Process by which companies create value for customers & build strong customer relationships in order to capture value from customers in return.Ethics In Marketing Aniket K.Kulkarni4

Marketing EthicsIt is the area of applied ethics which deals with the moral principles behind the operation and regulation of marketing. Ethics in marketing applies to different spheres such as in Marketing segmentation, Marketing research, Product packaging, Pricing, Distribution, Personal selling, Advertising & promotion.Ethics In Marketing Aniket K.Kulkarni5

Why we need Ethics in Marketing?

We can give many reasons but will notify some:When an organization behaves ethically, customers develop more positive attitudes about the firm, its products, and its services.To create Values or trust with key stakeholders. To build good image about the organization in the minds of customer, employees, shareholders and the society.Ethics In Marketing Aniket K.Kulkarni6

Ethical issues in marketingEthical issues in Marketing Research.Ethical issues in Marketing segmentation.Ethical issues in Product Packaging.Ethical issues in Pricing.Ethical issues in Advertising & Promotion.Ethical issues in Distribution. Ethical issues in Personal Selling.


Ethics of Marketing researchEthics in marketing research refers to moral principles that researcher or research organization should consider. Generally three parties are involved in marketing research:The client who sponsors the research project.The supplier who designs & executes the research.The respondents who provides the information.


Ethical issues in Marketing researchInformation or data collected from respondents should not used for other purpose or for other research work.Researcher should not force any respondents for answers.Protection of data or confidentiality of data.In case of personal or sensitive questions, researcher should give enough time to respondents to think about it.


Continues..Proper, unbiased and accurate information collection.Invasion of privacy (e.g. obtaining research data without permission).Stereotyping (drawing unfair or inappropriate conclusions).


Ethical issues in Marketing segmentationEthical danger points include:Excluding potential customers from the market (e.g. discouraging demand from undesirable market sectors or simply refusing to sell to certain customers).Examples of unethical market segmentation or selective marketing are past industry attitudes to the gay, ethnic minority etc. Ethics In Marketing Aniket K.Kulkarni11

Targeting the vulnerable (e.g. children, the elderly). Children are not capable of resisting or understanding marketing tactics at younger ages (children don't understand persuasive intent until they are eight or nine years old). In the case of children, the main products are unhealthy food, fashion ware and entertainment goods. Children are considered as lucrative market.Ethics In Marketing Aniket K.Kulkarni12

Marketing in schools is a widespread phenomenon in which schools sign contracts allowing certain businesses to conduct marketing activities in school facilities - primarily advertising. For example, a school might allow only one brand of soft drink to be sold in vending machines on the campus; in return, the soft drink company would provide compensation to the school (frequently money, but it may provide other compensation as well, such as building new facilities or paying for school supplies).


Ethics of Product PackagingPackaging is a crucial element in the marketing of a product, as it is essentially the casing that the product comes in. So after all the advertising and promotion, when customers go to the store and pick up the product, it is only the packaging that they see, smell, and touch. It is thus extremely important for the marketer to ensure that potential customers like what they see. The packaging should be appropriate to the product, and induce customers to buy it.Ethics In Marketing Aniket K.Kulkarni14

Ethical issues in Product PackagingProblems With Label Information: Sometimes marketers use label information to mislead consumers by providing untrue information to exaggerate the attributes of their product. Labels that display nutrition information like low fat, fat free, cholesterol free, and 100% pure juice are examples.Problems With Packaging Graphics: There are many cases in which marketers use pictures in packaging that do not represent the actual product.Ethics In Marketing Aniket K.Kulkarni15

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Continues..Problems With Packaging Safety: Consumers are concerned with packaging safety issues, especially when it comes to products for children. Marketers should avoid unsafe packaging that uses high ingredients of chemicals that are unsuitable for young children and are not tamper-proof.Problems With Environmental Issues: Some marketers tend to label their products as environmentally friendly. However, the products actually do not have environmentally friendly attributes.


Ethics of PricingEconomist defines price as the exchange value of a product or service always expressed in money.The amount a customer pays for the product. The price is very important as it determines the company's profit and hence, survival. Adjusting the price has a profound impact on the marketing strategy, and depending on the price elasticity of the product, often it will affect the demand and sales as well. The marketer should set a price that complements the other elements of the marketing mix.Ethics In Marketing Aniket K.Kulkarni19

List of unethical pricing practices

Bid riggingDumping (pricing policy)Predatory pricingPrice discriminationPrice gougingPrice fixingPrice skimmingPrice warSupra competitive pricingVariable pricingEthics In Marketing Aniket K.Kulkarni20

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Bid rigging:Illegal conspiracy in which competitors join to artificially increase the prices of goods and/or services offered in bids to potential customers. Dumping (pricing policy):In economics, "dumping" is a kind of predatory pricing, especially in the context of international trade. It occurs when manufacturers export a product to another country at a price either below the price charged in its home market or below its cost of production.Ethics In Marketing Aniket K.Kulkarni21

Continues..Predatory pricing Predatory pricing (also undercutting) is a pricing strategy where a product or service is set at a very low price, intending to drive competitors out of the market, or create barriers to entry for potential new competitors. If competitors or potential competitors cannot sustain equal or lower prices without losing money, they go out of business or choose not to enter the business. The predatory merchant then has fewer competitors or is even a de facto monopoly.Ethics In Marketing Aniket K.Kulkarni22

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Price discrimination: Price discrimination or price differentiation is a pricing strategy where identical or largely similar goods or services are transacted at different prices by the same provider in different markets or territories.Price fixing: Itis an agreement between participants on the same side in a market to buy or sell aproduct, service, or commodity only at a fixed price, or maintain the market conditions such that the price is maintained at a given level by controllingsupply and demand.


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Continues..Price skimming is a pricing strategy in which a marketer sets a relatively high price for a product or service at first, then lowers the price over time.

Price war is "commercial competition characterized by the repeated cutting of prices below those of competitors".Ethics In Marketing Aniket K.Kulkarni24

Continues..price gouging- pricing above the market price when no alternative retailer is available.

Variable pricing is a pricing strategy for products. Traditional examples include auctions, stock markets, foreign exchange markets, bargaining and discounts.Ethics In Marketing Aniket K.Kulkarni25

Ethics of Advertising & Promotion.

There is no doubt that advertising attracts all of us in number of ways, but there are also number of controversies associated with advertising.Advertising is primarily a means by which sellers communicate The worth of their goods and services to prospective buyers.


Ethical issues in Advertising & PromotionAdvertising Should not mislead the consumer.What it promises must be there in the performance of products.Ads. should not be indecent and obscene.As advertising is also a social process, it must honour the norms of social behaviour, and should not offend our moral sense.Ethics In Marketing Aniket K.Kulkarni27

Unethical Issues in Advertising & PromotionAdvertising is a highly visible business activity and any lapse in ethical standards can often be risky for the company.Vulgarity/Obscenity used to gain consumers attention.Misleading information and deception.Puffery.Stereotypes.Racial issues.Controversial products (e.g. alcohol, gambling, tobacco etc.).Ethics In Marketing Aniket K.Kulkarni28

Fake adds.


Exaggerated ads.



Racial issues in ads.


The ad starts with the host asking a young contestant the question, Kohima city is part of which country? A.China, B.Nepal, C.India, D.Bhutan The contestant opts for an audience poll, a life-line in the game show, where 100% of the respondents say India. Its India, everyone knows this answer, says Amitabh Bachchan, to which the young contestant replies: Everyone knows the answer, but how many people actually acknowledge it?


Unethical issues in promotionOffers of additional gift items (bonuses)DiscountsFree offers.Distribution of discount vouchers, coupons and samples.Using personalities for sales promotion.Linking charity purposes with sales promotions.Consumer contests and lotteries.Ethics In Marketing Aniket K.Kulkarni34

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Unethical issues in Distribution.

Powerful supermarket chains often demand payments from producers (slotting allowances) to ensure that their products will have shelf space in supermarkets. Many supermarket operators also demand pay-to-stay fees payments to supermarkets by producers to keep their products on the shelf.Ethics In Marketing Aniket K.Kulkarni37

Continues..The gray market also raises ethical issues. The gray market is unauthorized intermediaries that go around authorized marketing channels by buying in low- price from wholesaler and reselling in markets at lower prices than those charged by authorized channel members. e.g. Importing and selling Apple products in countries such as South Korea where official Apple retail stores aren't present.Ethics In Marketing Aniket K.Kulkarni38

Continues..One ethical issue that arises in connection with distribution is the use of power by a channel leader.Conflicts that arises between different levels or at the same levels within the same channel . e.g.HUL came into conflict with its distributers in Kerala on the issue of commissions.Ethics In Marketing Aniket K.Kulkarni39

Unethical issues in Personal Selling

Misrepresentation.Deception: Deliberately presenting inaccurate information, or lying, to a customer is illegal. Bribes, gifts and entertainment: Bribes are payments made to buyers to influence their purchase decisions.Kickbacks are payments made to buyers based on the amount of orders placed.Ethics In Marketing Aniket K.Kulkarni40

High-Pressure Selling: High Pressure Selling is defined as a extremely aggressive behaviour by an salesperson to convince a consumer to purchase the product or service without due regard for the consumers ability to pay and/or needs for the product or service. Ethics In Marketing Aniket K.Kulkarni41

Kotler, Philip, Keller, Kevin Lane, Koshy, Abrahan, & Jha, Mithileshwar. (2009). Marketing Management (13th ed.). Dorling Kindersley: pearson education in south asia.https://www.boundless.com/marketing/textbooks/boundless-marketing-textbook/social-responsibility-ethics-in-marketing-16/ethics-in-marketing-102/issues-in-marketing-502-10770/http://en.wikipedia.org/wiki/Marketing_ethicshttp://www.slideshare.net/clawtin09/marketing-ethics


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ethics in marketing_aniket kulkarni.pptx