11
Marketing and Society:
Social Responsibility and
Marketing Ethics
ROAD MAP: Previewing the Concepts
• The major social criticisms of marketing.
• Consumerism and environmentalism:
– How they affect marketing strategies?
• The principles of socially responsible
marketing.
• The role of ethics in marketing.
Professor Takada
11-2
Criticisms of Marketing
High Prices
Deceptive Practices
High-Pressure Selling
Shoddy or Unsafe Products
Planned Obsolescence
Poor Service to Disadvantaged Consumers
Professor Takada
11-3
High Prices
Caused by:
High Costs of Distribution
High Advertising and Promotion Costs
Excessive Markups
Professor Takada
11-4
High Costs
A heavily promoted brand of aspirin sells for much more than a virtually
identical non-branded or store-branded product. Critics charge that promotion
adds only psychological value to the product rather than functional value.
Professor Takada
11-5
Social Responsibility
Click the picture above to play video
Honest Tea offers
customers, in
addition to tea, a
relationship with a
community.
Professor Takada
11-6
Deceptive Practices
• Deceptive Pricing:
– Falsely advertising “factory” or “wholesale” prices or
large reductions from phony high retail list prices.
• Deceptive Promotion:
– Overstating a product’s features or performance,
running rigged contests.
• Deceptive Packaging:
– Exaggerating package contents through subtle design,
using misleading labeling, etc.
Professor Takada
11-7
High-Pressure Selling
• Salespeople are trained to deliver smooth,
canned talks to entice purchase.
• Hard sales can occur because of prizes
going to top sellers.
• High-pressure selling not good for longterm relationships.
Professor Takada
11-8
Shoddy or Unsafe Products
• Products not made well or service not
performed well.
• Products deliver little benefit or can be
harmful.
• Unsafe products due to manufacturer
indifference, increased production
complexity, poorly trained labor, and poor
quality control.
Professor Takada
11-9
Product Safety
Following its recall of
6.5 million flawed
Firestone tires,
product liability and
safety concerns have
driven Bridgestone/
Firestone to the brink
of bankruptcy.
Professor Takada
11-10
Planned Obsolescence
• Products needing replacement before they
should be obsolete.
• Producers change consumer concepts of
acceptable styles.
• Intentionally holding back attractive
functional features, then introducing them
later to make old model obsolete.
Professor Takada
11-11
Poor Service to Disadvantaged
Consumers
• Poor may pay more for inferior goods.
• “Redlining” may occur in disadvantaged
neighborhoods.
• Higher insurance premiums to people with
poor credit ratings.
• “Weblining” can occur.
Professor Takada
11-12
Marketing’s Impact on Society as
a Whole
False Wants & Too
Much Materialism (i.e.,
Producing Too Few
Social Goods
what you own vs. who
you are).
Too Much Political
Power
Cultural Pollution
Professor Takada
11-13
Cultural Pollution
Our senses are sometimes assaulted by commercial messages.
Professor Takada
11-14
Marketing’s Impact on Other Businesses
Acquisitions of Competitors
Marketing Practices That Create
Barriers to Entry
Unfair Competitive Marketing Practices
Professor Takada
11-15
Consumerism
• Consumerism is an
organized movement
of citizens and
government agencies
to improve the rights
and power of buyers
in relation to sellers.
Professor Takada
11-16
Consumerism: Sellers’ Rights
The right to introduce any product in any size and style, provided it is
not hazardous to personal health or safety; or, if it is, to include proper
warnings and controls.
The right to charge any price for the product, provided no discrimination
exists among similar kinds of buyers.
The right to spend any amount to promote the product, provided it is
not defined as unfair competition.
The right to use any product message, provided it is not misleading or
dishonest in content or execution.
The right to use any buying incentive schemes, provided they are not
unfair or misleading.
Professor Takada
11-17
Consumerism: Buyers’ Rights
The right not to buy a product that is offered for sale.
The right to expect the product to be safe.
The right to expect the product to perform as claimed.
The right to be well informed about important aspects of the product.
The right to be protected against questionable products and marketing
practices.
The right to influence products and marketing practices in ways that will
improve “quality of life.”
Professor Takada
11-18
Environmentalism
• An organized
movement of
concerned citizens
and government
agencies to protect
and improve
people’s living
environment.
Professor Takada
11-19
Environmental Sustainability
• A management
approach that
involves developing
strategies that both
sustain the
environment and
produce profits for
the company.
Professor Takada
11-20
Environmental Sustainability Grid
Professor Takada
11-21
Legal Issues Facing Marketing Mgmt.
Professor Takada
11-22
Enlightened Marketing
• A marketing philosophy holding that a
company’s marketing should support the
best long-run performance of the
marketing system.
Professor Takada
11-23
Enlightened Marketing
• Consumer-Oriented Marketing:
– The philosophy of enlightened marketing that
holds that the company should view and
organize its marketing activities from the
consumer’s point of view.
• Innovative Marketing:
– A principle of enlightened marketing that
requires that a company seek real product
and marketing improvements.
Professor Takada
11-24
Innovative Marketing
Colgate’s Total toothpaste is perhaps the best example of Colgate's
passion for innovation. The breakout brand provides a combination
of benefits, including cavity prevention, tartar control, fresh breath,
and long-lasting effects.
Professor Takada
11-25
Enlightened Marketing
• Value Marketing:
– A principle of enlightened marketing that
holds that a company should put most of its
resources into value-building marketing
investments.
• Sense-of-Mission Marketing:
– A principle of enlightened marketing that
holds that a company should define its
mission in broad social terms rather than
narrow product terms.
– Click Here to View Ben & Jerry's Mission
Statement
Professor Takada
11-26
Societal Classification of Products
Professor Takada
11-27
Marketing Ethics
• Corporate Marketing Ethics Policies:
– Broad guidelines that everyone in the organization
must follow.
• These should cover:
–
–
–
–
–
–
Distributor relations
Advertising standards
Customer service
Pricing
Product development
General ethical standards
Professor Takada
11-28
Marketing Ethics
• What principle should guide companies
and marketing managers on issues of
ethics and social responsibility?
Free market and
legal system
Responsibility
falls to individual
companies and
managers
Click Here to See: "Malden Mills: A Study in Leadership"
Professor Takada
11-29
Ethics Programs
PricewaterhouseCoopers
established a
comprehensive ethics
program, which begins
with a code of conduct
called “The Way We Do
Business.” Says PwC’s
CEO, “Ethics is in
everything we say and
do.”
Professor Takada
11-30
Rest Stop: Reviewing the Concepts
1. Identify the major social criticisms of
2.
3.
4.
marketing.
Define consumerism and
environmentalism and explain how they
affect marketing strategies.
Describe the principles of socially
responsible marketing.
Explain the role of ethics in marketing.
Professor Takada
11-31