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C H A P T E R

Marketing Ethics

4

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L E A R N I N G O B J E C T I V E S

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Identify the ethical values marketers should embrace.

Distinguish between ethics and social responsibility.

Identify the four steps in ethical decision making.

Describe how ethics can be integrated into a firm’s marketing strategy.

Describe the ways in which corporate social responsibility programs help various stakeholders.

Marketing Ethics

LO1

LO2

LO3

LO4

LO5

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Firm Goals

Greed and short term profit seeking

Serious long term consequences

Creating value over the long run

Long term success

Javier Pierini/Getty Images

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The Scope of Marketing Ethics

Business Ethics Marketing Ethics

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Attitudes About the Ethical Standards of Various Professions

Why do you feel marketers (advertising practitioners & salespeople) rank so low on this scale?

What can marketers do to improve their ranking?

Jeffrey M. Jones, “Nurses Top Honesty and Ethics List for 11th Year,” Gallup, November 19–21, 2010, http://www.gallup.com/poll-145043/nurses-top-honesty-ethicslist-11-year.aspx

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Creating an Ethical Climate in the Workplace

Values• Establish• Share• Understand

Rules• Management commitment• Employee dedication

Controls• Reward• Punishment

Stockbyte/Getty Images

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American Marketing Association Code of Ethics

Generally accepted code in marketing

Flows from general norms of conduct to specific values

Subareas within marketing have their own code of ethics to deal with specific issues

AMA Website

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The Influence of Personal Ethics

Genetics Family

Religion Values

Corbis/Jupiter images

Photo Disc/Getty Images ©Digital Vision Ltd.

©Royalty-Free/CORBIS Getty Images

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Why People Act Unethically

Are all the individuals who engage in questionable

behavior just plain immoral or unethical?

What makes people take actions that create so much

harm?

Decisions often have conflicting outcomes, where both options have positive and negative consequences

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Competing Outcomes

Dangerous flaw in new model

Delay production

Delayed revenue

Possible layoffs

Loss of bonuses

Continue production

Potential injury to

consumers

Loss of revenue

Digital Vision/Getty Images

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The Link Between Ethics and Corporate Social Responsibility

Socially Responsible Socially Irresponsible

Eth

ica

lU

ne

thic

al

Both ethical and sociallyresponsible

Neither ethical norsocially responsible

Questionable firmpractices, yet donates a

lot to the community

Ethical firm not involvedwith the larger

community

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A Framework for Ethical Decision Making

Step 1

• Identify Issues

Step 2

• Gather information and identify stakeholders

Step 3

• Brainstorm and evaluate alternatives

Step 4

• Choose a course of action

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Step One: Identify Issues

Marketing research

firm issues

Using results to mislead or even harm the public

Data collection methods

Hiding the real

purpose of the study

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Step Two: Gather Information and Identify Stakeholders

Identify all ethical issues and relevant legal information

Identify all relevant stakeholders and get their input on any identified ethical issues

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Step Three: Brainstorm and Evaluate Alternatives

Halt the market research project?

Make responses anonymous?

Instituting training on the AMA Code of Ethics for all researchers

Ryan McVay/Getty Images

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Step Four: Choose a Course of Action

Weigh the alternatives

Take a course of action

Digital Vision/Getty Images

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CHECK YOURSELF

1. Identify the stages in the ethical decision-making framework.

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Integrating Ethics Into Marketing Strategy

Planning Phase

Implementation Phase

Control Phase

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Planning Phase

The mission or vision statement sets the overall ethical tone for planning.

Mission statements can be used as a means to guide a firm’s SWOT analysis.

©M Hruby

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Newman’s OwnDonating over $200 million since 1982

©Newman’s Own, Inc.

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Implementation Phase

Should the firm be targeting this market with this product?

Should the firm be selling its product in this market

in this manner?

Should the firm be relocating production to another country?

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Control Phase

1. Check successful implementation

2. React to change

Barbara Penoyar/Getty Images

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CHECK YOURSELF

1. What ethical questions should a marketing manager consider at each stage of the marketing plan?

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Corporate Social Responsibility

• Employees• Their families

Employees

• Current customers

• Potential customers

Customers

• Community• Environment

Society

• Partners• Competitors

Marketplace

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CHECK YOURSELF

1. How has corporate social responsibility evolved since the turn of the twenty-first century?

2. Provide examples of each of the stakeholders that firms should consider in their corporate social responsibility efforts.

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Corporate social responsibility describes the voluntary actions taken by a company to address the ethical, social, and environmental impacts of its business operations and the concerns of its stakeholders.

Glossary