ETHICS IN MARKETING

VASANTH SS2 MBA

GIMS

ETHICS• The word ethics is derived from the Greek

word “Ethikos” which means custom or character.

“Our concern for good behaviour. We feel an obligation to consider not only our own

personal well being but also that of others”.Albert Schweitzer

Marketing Marketing consist of the performance of

business activities that direct the flow of goods and services from producer to consumer.

A number of distinct function is coming under this broad characterization which include:1) Product Development2) Distribution3) Pricing4) Promotion5) Sales

Marketing• “Marketing is a societal process by

which individuals and groups obtain what they need and want through creating, offering and freely exchanging products and services of value with others”

Philip Kotler

Marketing ethics• Marketing ethics addresses principles and standards that define

acceptable conduct in the market place. Marketing usually occurs in the context of an organization, and unethical activities usually develop from the pressure to meet performance objectives. Some obvious ethical issues in marketing involves clear cut attempts to deceive or take advantage of a situation

MARKETING ETHICS AND CONSUMER RIGHTS

• The law and regulations are generally designed to protect the consumer from unethical practices by businesses

• These law and regulations recognizes that consumers have certain basic rights in the market place

• Each marketer must relay on his/her own value system to determine what is and is not ethical

Cont………• AMA has established a codes of ethics to provide

guidelines for ethical conduct. It says, in part, that,“Marketers shall uphold and advance the

integrity, honour and dignity of the marketing profession, by being honest in serving

consumers, clients, employees, suppliers, distributors, and the public.”

ETHICAL VALUES• Honesty: to be truthful and forthright in our dealings with customers

and stakeholders.

• Responsibility: to accept the consequences of our marketing decisions and strategies.

• Fairness: to try to balance justly the needs of the buyer with the interests of the seller.

• Respect: to acknowledge the basic human dignity of all stakeholders.

CONTD…….• Openness: to create transparency

in our marketing operations.• Citizenship: to fulfill the

economic, legal and societal responsibilities that serve stakeholders in a strategic manner.

CRITICISMS OF ETHICS IN MARKETINGI. CRITICISM OF THE FORMER : Promotion of morally ‘bad’ values such as the

excessive consumption of private rather than public goods and services comes under this.

II. CRITICISM OF SPECIFIC PRACTICES : These are frequently based on assumptions

drawn from system level critiques. The criticism are:

• Advertisement : that gives false information, penetrating to wrong values. Eg: Indulekha

• Personal selling : the ethics of the relationship of sales people to customer

• Packaging and labelling practices :irregularities of package size and shapeecological issuesPricing practicesProvision of intelligible labelling information

SOCIALLY RESPONSIBLE ADVERTISING

Most advertisements are socially responsibleSome advertisements are willfully misinformed

the publicDeceptive Advertising: Advertising that give

false info:Corrective Advertising: company publicly

correct a false impression created by past advertising

UNFAIR MARKETING PRACTICES• False and misleading presentation of

facts.• Deliberate omitting of required

information.• Implying a benefit that hardly exists.• Trade puffing and exaggerations• Open criticism of competitors.

FOUR AREAS OF PRICING ARE CONSIDERED UNETHICAL AND

ILLEGAL:• Deceptive Pricing: Where a salesperson

tries to influence lure customers into a store. Thereafter, a salesperson tries to influence to buy a higher-priced item.

• Unfair Pricing: When competitors are driven out by low prices the company raises price back to their former level.

• Price Discrimination: It can be unethical if similar buyers are charged different prices for the same based on their ability to pay.

• Price fixing: It is an agreement among firms in an industry to set up prices at certain levels.

THANK YOU……..