Social Responsibility & Ethics in Marketing
Though the pursuit of social responsibility and ethical marketing does not automatically translate into increased profit, it is still the responsibility of the firm to ensure it is responsible for its actions and their impact on society. This article will study, 1) understanding business ethics and socially responsible marketing, 2) developing and implementing a socially responsible marketing plan, 3) main aspects of socially responsible marketing, 4) characteristics of socially responsible marketing, 5) 5 benefits of integrating ethics into your marketing strategy, 6) ethical issues faced in marketing, and 7) summary of unethical marketing practices that ruin companies.
UNDERSTANDING BUSINESS ETHICS AND SOCIALLY RESPONSIBLE MARKETING
To be socially responsible is when the organization is concerned about people, society and environment with whom and where it conducts business. In it’s most basic form, socially responsible marketing is taking moral actions that encourage a positive impact on all the company’s stakeholders, including employees, community, consumers, and shareholders. The main responsibility of marketers in this aspect is to package and communicate the organization’s decisions that will impact the various communities with which they interact. Consumers have the right and power to decide which companies succeed or fail; so marketers have a major responsibility to ensure their practices are seen as philanthropic without being phony. BrandKarma is the perfect example of one of the means by which consumers make these decisions.
Ethical Marketing in General
Ethical Marketing is a philosophy that focus focuses on honesty, fairness and responsibility. Though wrong and right are subjective, a general set of guidelines can be put in place to ensure the company’s intent is broadcasted and achieved. Principles of this practice include:
- A shared standard of truth in marketing communications
- A clear distinction between advertising and sensationalism
- Endorsements should be clear and transparent
- Consumers’ privacy should be maintained at all times
- Government standards and regulations must be adhered and practiced by marketers.
American Ethical Norms and Values for marketers
The American Marketing Association has designed a statement of ethics that governs marketers’ actions. The introduction of the statement reads in summary that values are the representation of the collective idea of desirable and morally correct conduct. And that the values outlined in the document serve as the standard by which individuals measure their own actions and those of others including marketers. These values facilitate best practices when transacting business with the public and all involved.
There are 6 ethical values that marketers are expected to uphold, and these are:
- Honesty – Be forthright in dealings and offer value and integrity.
- Responsibility – Accept consequences of marketing practices and serve the needs of customers of all types, while being good stewards of the environment.
- Fairness – Balance buyer needs and seller interest fairly, and avoid manipulation in all forms while protecting the information of the consumers.
- Respect – Acknowledge basic human dignity of all the people involved through efforts to communicate, understand and meet needs and appreciate contributions of others.
- Transparency – Create a spirit of openness in the practice of marketing through communication, constructive criticism, action, and disclosure.
- Citizenship – Fulfill all legal, economic, philanthropic and societal responsibilities to all stakeholders as well as giveback to the community and protect the ecological environment.
Canadian Marketing Code of Ethics and Standards and Practices
The Canadian Marketing Association also has a code of ethics and standards, which is a self-regulatory guideline for marketers. Though marketers are responsible for their marketing content, members of the CMA must abide the code. The principles of this code include:
- Truthfulness, which is an accurate representation of products and support of claims, made.
- Personal Information protection, which is defined in the Personal Information Protection and Electronics Documents Act (PIPEDA).
- Campaign Limitation covers non-involvement in disparaging or exploitative practices and the protection of vulnerable consumer groups such as children, teenagers, people with disabilities and the elderly.
Merging Social Responsibility and Marketing
Companies are aware that consumers are savvy and opinionated. So with this in mind, firms should create an ethically sound marketing plan and integrate it into all aspects of their marketing mix.
- Do good not just to look good – focus on being responsible and how your firm can truly help the neighborhood or country. It is in doing so that your customers, the press, and all those watching will be impressed.
- Think about long term effects, not short term gains – short sighted companies will undervalue the impact of responsible marketing for instantly gratifying increase.
- Speak up against company policies that do not reflect the ethical profile of the company – as the face of the company, marketers should voice their concerns when there is a potential for a practice to be seen as unethical.
DEVELOPING AND IMPLEMENTING A SOCIALLY RESPONSIBLE MARKETING PLAN
While ethics and social responsibility are sometimes used interchangeably, there is a difference between the two terms. Ethics tends to focus on the individual or marketing group decision, while social responsibility takes into consideration the total effect of marketing practices on society. In order to foster an ethical and socially responsible behavior pattern among marketers while achieving company objectives, special care must be taken to monitor trends and shifts in society’s values and beliefs. Next, marketers should forecast the long-term effects of the decisions that pertain to those changes. Bearing in mind that a company cannot satisfy the needs of an entire society, it best serves marketers to focus their most costly efforts on their target market, while being aware of the values of society as a whole. Five simple steps every marketer can take to create a sustainable socially responsible market plan are:
- Define what is ethical marketing for your firm.
- Decide which branch of ethics your marketers will apply.
- Determine how the ethical approach to marketing will be implemented.
- Discuss areas of the firm’s operations that ethical marketing will be included as part of the program.
- Analyse and assess how much ethical marketing will cost the company and compare this against the benefits of ethical marketing in the long run.
MAIN ASPECTS OF SOCIALLY RESPONSIBLE MARKETING
Social conscious marketing addresses the shortcomings of traditional marketing practices and follows the philosophy of mindfulness and responsibility. This philosophy states according to Chron.com, that company-marketing practices should be based on consumer satisfaction, innovative ideas and offer society long-term value and benefit.
Below is the list of main aspects socially responsible marketing practice rely on.
This socially responsible practice teaches that companies should base policies and operations on a consumer perspective. Not only will the marketer discover the customers’ needs, they will also, look at their plans as if they were the users. As an example, an over crowded website with lots of ads dumped onto it will be easily spotted if the marketers were to practice this method.
Improving products and services in innovative manner improves the experience for users. And improving marketing strategies, polices, and brand personality, on an ongoing basis will position your company as an innovative experience to be repeated and passed on.
Value of the product
A company that produces valuable products and focuses on offering the customer great pricing, excellent experiences and great customer service will not have to resort to pushy sales tactics and gimmicks. Apple brand is famous for having people happily wait in line overnight to be first to own an upgraded product.
Sense of Mission
A clearly defined corporate mission will help companies be clear about their plans, goals, and practices. By putting the good of the community and associates over profit, companies will indeed see an increase in the number of consumers willing to pay premium prices for their products.
Impact On Society
Unlike traditional marketing focus, which was cost reduction and profit increase, socially responsible marketers are more focused on providing goods and services consumers want, gaining feedback for improvement and giving back to the communities that helped them become who they are.
CHARACTERISTICS OF SOCIALLY RESPONSIBLE MARKETING
Marketers get the right products to the right people at the right time. Ethical marketers ensure the products meet and exceed their needs, back up their claims and offer value to the customers over time while finding opportunities to pay it forward. A company that uses ethical and socially responsible marketing strategy will gain the respect and trust of the customers they target and interact with. Over long term, this will translate to greater benefits all round. Today’s firms can make their practices more ethical and responsible by perfecting the following characteristics.
- Safety: Any product or service that could be hazardous to the health conditions of people, animals or the environment should have clear advisories and warnings. Once the problem is identified the company can collect data to help improve the product and reduce or eliminate the danger. An example would be fast food restaurants eliminating the use of hydrogenated oils even before trans fats were banned.
- Honesty: Ensuring a product satisfies a need it promises to, or aids in providing a lifestyle it advertises. Advertising should be transparent about possible side effects and not puff up results, so clients come to respect the honesty of your advertising.
- Transparency: Any techniques to manipulate and hide facts and information customers need could harm a company. Just think of the way people regard a company such as Enron that hid information and was not open to the stakeholders about what was happening.
- Ethical Pricing: Gathering data about your target market will give you information on how much they are willing to pay for your product. The rest of the pricing strategy, in a simplified manner, should be based on overhead costs and supply and demand. Creating fake shortages and bad mouthing the competition are considered unethical marketing practices.
- Respecting Customer Privacy: When customers trust enough to allow you access to their information, selling it to lead companies or obtaining prospective customers’ information without permission is unethical and breaks trust. Nobody wants to buy from the creepy guys, no matter how beautifully packaged their products are.
5 BENEFITS OF INTEGRATING ETHICS INTO YOUR MARKETING STRATEGY
#1: Moral Marketing Compass: This is especially important in economic downturns, when unethical practices become tempting.
#2: Win-win Marketing: The focus on customer value will increase company value.
#3: Keeps marketing legal: Reduces the risk of cutting corners and turning a blind eye.
#4: Goodwill: Goodwill and strong reputation among clients and associates are the benefits which companies cannot afford to overlook. Not only will customers believe that the company cares for them, but will also associate the brand with pleasant feelings and experiences and spread the word.
#5: Improved quality of recruits and increases retention: A good company attracts good employees, suppliers, investors, and customers, who will be happy to help the company to achieve its goals. Great marketing practices make new marketers feel like their time on the job will make a difference and so will be less likely to change jobs, as will suppliers and other people involved.
ETHICAL ISSUES FACED IN MARKETING
So far we have seen that ethical marketing can guide advertising, research and data use, strategies for gaining an edge over the competition and company polices. However, there can also be some problems that arise from trying to employ an ethical marketing strategy.
- Irresponsible Market Research: Improper market research and grouping can lead to stereotyping that shapes undesirable beliefs and attitudes and consequently affect marketing behavior. For example, assuming that all women like pink and therefore basing an entire advertising campaign on that belief could be a costly mistake.
- Selecting Specific Market Audience: According to Boundless.com, the use of selective marketing practice is to weed out the consumers considered by companies as less than ideal, but often causes social disparity and unrest. Practices such as Victoria Secrets’ “Perfect Body Campaign,” which came under a lot of fire from consumers for excluding every woman but those shaped like the long legged, thin and well endowed supermodels in their ad, can turn people away from a company.
- Unethical Advertising and Promotion: Making false claims about what the product does and its importance is an unethical way to gain profit. For many years, Nestlé has been the target of many boycotts for predatory and aggressively marketing baby foods, especially to women in poorer countries as a better substitute to breastfeeding. This manipulative marketing technique has caused a lot of damage and loss to these children and their families.
- Delivery Channel practices: Marketing in ways like cold calling through telemarketing companies that purchase leads are not only annoying, they are disruptive and untrustworthy. Unsolicited approaches are these days almost synonymous with direct marketing and has left the industry with a tainted reputation. So have television commercials, email spam and direct mail, which people are going to significant lengths to avoid.
- Dealing with competitors: Many companies advertise cheap prices as a “bait” and then once they draw in the customers, “switch” them over to a more costly product, because the advertised good was not available, insufficient or not of any value to the customer. Many online surveys and work at home opportunities use this unethical marketing technique.
- Pricing strategies: Predatory pricing or pricing beneath the competition so as to cannibalize the market and restrict the competition is an unethical pricing strategy. And setting up barriers that prevent smaller companies from entering the market is unethical as well.
SUMMARY OF (UN)ETHICAL MARKETING
To sum this all up, in order to be ethical in marketing attempts, businesses should make honest claims, and excel at satisfying the needs of their customers. This practice over time builds trust and customer confidence in your brand’s integrity and therefore leads to loyalty, customer and employee retention, greet public relations and increase in business from customers spreading the word.
Unethical marketing behaviors will achieve the exact opposite and in time could even lead companies into legal troubles and dissemination of a bad reputation and worse customer experience. Below are practices of unethical marketing, which you should avoid in order not to ruin your company.
- Exploitation – avoid using scare tactics and hard sell and protect the vulnerable consumer.
- Spam – avoid flooding a customer’s voicemail, mailbox, email or any other means of communication with unsolicited messages or aggressive advances.
- Bad mouthing Competition – focus on the value and benefit of your product and point out its unique selling point, the consumers are smart enough to choose the better product.
- Misleading Advertisement and Information –any exaggerated claims or dishonest promises will cause the customers to mistrust you and even determine the failure of your brand.
- Philanthropic gestures for public relations – giving to charities solely for a tax write off will make the company appear callous and uncaring and people tend to shy away from these types of companies and spend money where they feel the leaders and marketers are especially humane and gracious.
As an entrepreneur seeking to grow your business or make money from your invention, there is a very …