Chapter four marketing ethics 1 Mc GrawHill Education

Chapter four marketing ethics 1 ©Mc. Graw-Hill Education. All rights reserved. Authorized only for instructor use in the classroom. No reproduction or further distribution permitted without the prior written consent of Mc. Graw-Hill Education.

Learning Objectives LO 4 -1 Identify the ethical values marketers should embrace. LO 4 -2 Distinguish between ethics and social responsibility. LO 4 -3 Identify the four steps in ethical decision making. LO 4 -4 Describe how ethics can be integrated into a firm’s marketing strategy. LO 4 -5 Describe the ways in which corporate social responsibility programs help various stakeholders. 2 © Mc. Graw-Hill Education

Consumer Privacy 3 © Mc. Graw-Hill Education

Firm Goals Greed and short term profit seeking Serious long term consequences Javier Pierini/Getty Images Creating value over the long run Long term success 4 © Mc. Graw-Hill Education

The Scope of Marketing Ethics Business Ethics Marketing Ethics 5 © Mc. Graw-Hill Education

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 © Mc. Graw-Hill Education 6

The Influence of Personal Ethics Photo Disc/Getty Images Genetics ©Digital Vision Ltd. Family r images Corbis/Jupite ©Royalty-Free/CORBIS Getty Images Religion Values 7 © Mc. Graw-Hill Education

Why People Act Unethically What makes people take actions that create so much harm? Are all the individuals who engage in questionable behavior just plain immoral or unethical? Decisions often have conflicting outcomes, where both options have positive and negative consequences 8 © Mc. Graw-Hill Education

Competing Outcomes Dangerous flaw in new model Delay production Continue production Delayed revenue Potential injury to consumers Possible layoffs Loss of revenue Digital Vision/Getty Images Loss of bonuses Jump to Appendix 1 long image description © Mc. Graw-Hill Education 9

Socially Responsible Socially Irresponsible Ethical Both ethical and socially responsible Ethical firm not involved with the larger community Unethical The Link Between Ethics and Corporate Social Responsibility Questionable firm practices, yet donates a lot to the community Neither ethical nor socially responsible Jump to Appendix 2 long image description © Mc. Graw-Hill Education 10

A Framework for Ethical Decision Making Step 1 • Identify Issues Step 2 Step 3 • Gather information and identify stakeholders Jump to Appendix 3 long image description © Mc. Graw-Hill Education • Brainstorm and evaluate alternatives Step 4 • Choose a course of action 11

Step 1: Identify Issues Using results to mislead or even harm the public Marketing research firm issues Hiding the real purpose of the study © Mc. Graw-Hill Education Data collection methods Jump to Appendix 4 long image description 12

Step 2: 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 13 © Mc. Graw-Hill Education

Step 3: Brainstorm and Evaluate Alternatives Halt the market research project? Make responses anonymous? Instituting training on the AMA Code of Ethics for all researchers Ryan Mc. Vay/ s Getty Image 14 © Mc. Graw-Hill Education

Step 4: Choose a Course of Action Weigh the alternatives Take a course of action Digital Vision/Getty Images 15 © Mc. Graw-Hill Education

check yourself 1. Identify the stages in the ethical decisionmaking framework. 16 © Mc. Graw-Hill Education

Integrating Ethics Into Marketing Strategy Planning Phase Implementation Phase Control Phase 17 © Mc. Graw-Hill Education

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 18 © Mc. Graw-Hill Education

Newman’s Own Donating over $200 million since 1982 ©Newman’s Own, Inc. 19 © Mc. Graw-Hill Education

Implementation Phase Should the firm be relocating production to another country? Should the firm be targeting this market with this product? Should the firm be selling its product in this market in this manner? 20 © Mc. Graw-Hill Education

Control Phase 1. Check successful implementation 2. React to change Barbara Penoyar/Getty Images 21 © Mc. Graw-Hill Education

check yourself 1. What ethical questions should a marketing manager consider at each stage of the marketing plan? 22 © Mc. Graw-Hill Education

Corporate Social Responsibility Employees Marketplace Customers Sustainability Society 23 © Mc. Graw-Hill Education

Sampling of Major Companies’ CSR Programs Company Illustration of CSR Program Amazon. com Developed nonprofit Simple Pay Donation system to help nonprofits raise money easily BMW Light Up Hope and BMW Children’s Safety programs Coca-Cola Spent $102 million through The Coca-Cola Campaign focusing on water stewardship, healthy and active lifestyles, community recycling, and education Fed. Ex Transported more than 67 planes worth of aid to disaster victims General Electric Ecomagination campaign, GE Volunteers Foundation Google. org funds for pro-profit entrepreneurship in Africa, Google China Social Innovation Cup for College Students Mc. Donald’s 99 percent of fish come from MSC-fisheries, transitioning to sustainable food and packaging sources, Ronald Mc. Donald House charities Procter & Gamble Live, Learn, and Thrive improves the lives of children worldwide Southwest Airlines Employees donate volunteer hours to Ronald Mc. Donald Houses throughout the U. S. Starbucks Develops ecologically friendly growing practices, LEED certified stores Source: Adapted from http: //money. cnn. com/magazines/fortune/most-admired/. 24 © Mc. Graw-Hill Education

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. 25 © Mc. Graw-Hill Education

Appendix 1 Competing Outcomes When there is a dangerous flaw in a new model, two choices emerge: delay production, resulting in delayed revenue, possible layoffs, and loss of bonuses; or continue production, which results in potential injury to consumers and loss of revenue. Return to slide 27 © Mc. Graw-Hill Education

Appendix 2 The Link Between Ethics and Corporate Social Responsibility Firms may be both ethical and socially responsible, ethical but not socially responsible (not involved with the larger community), unethical but socially responsible (questionable firm practices yet donates a lot to the community, or unethical and socially irresponsible. Return to slide © Mc. Graw-Hill Education 28

Appendix 3 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 Return to slide 29 © Mc. Graw-Hill Education

Appendix 4 Step 1: 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 Return to slide 30 © Mc. Graw-Hill Education