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Chapter 4

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  1. Chapter 4 Marketing and Society: Social Responsibility and Marketing Ethics

  2. Learning Goals • Understand marketing’s multiple responsibilities, and identify the major social and ethical criticisms of 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

  3. Ben & Jerry’s – The Body Shop • Early 1980’s revolutionaries such as Ben & Jerry’s or The Body Shop were social activists first, business people second • Second wave are business people who are passionate about a cause • Companies can improve their bottom lines while doing good by selling “quality products, treating employees, vendors, and franchisees with integrity and upgrading their environmental practices”

  4. Mountain Equipment Co-op (MEC) • Mountain Equipment Co-operative (MEC) founded in 1971 • Its early mission was to provide quality outdoor equipment at affordable prices • Member-owned co-operative • Focus on environmental responsibility • Statement of values and ethical behaviour • Development of lifetime relationships with its members • 2 million members, sales of $197 m in 2005 • Operates retail stores in 9 Canadian cities

  5. Learning Goals • Understand marketing’s multiple responsibilities, and identify the major social and ethical criticisms of 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

  6. Social and EthicalCriticisms of Marketing • Marketing’s Impact on Individual Consumers • High Prices • High costs of distribution • High advertising and promotion costs • Excessive markups

  7. Social and EthicalCriticisms of Marketing • Marketing’s Impact on Individual Consumers • Deceptive Practices • Pricing • Promotion • Packaging • High-Pressure Selling

  8. Social and EthicalCriticisms of Marketing • Consumer groups, including Generation Green are claiming that Splenda’s campaign “made from sugar so it tastes like sugar” is misleading • The claim is that it leads customers to believe that Splenda is a natural sugar alternative rather than an artificial sweetener • The group is appealing to the FTC to have them stop this campaign

  9. Social and EthicalCriticisms of Marketing • Marketing’s Impact on Individual Consumers • Shoddy or unsafe products • Planned obsolescence • Poor service to disadvantaged consumers

  10. Social and EthicalCriticisms of Marketing • Marketing’s Impact on Society as a Whole • False wants and too much materialism • Too few social goods • Cultural pollution • Too much political power

  11. Social and EthicalCriticisms of Marketing • Marketing’s Impact on Other Businesses • Acquisitions of competitors • Marketing practices which create barriers to entry • Unfair competitive marketing practices

  12. Learning Goals • Understand marketing’s multiple responsibilities, and identify the major social and ethical criticisms of 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

  13. Citizen & Public Actionsto Regulate Marketing • Consumerism • Traditional seller’s rights • Fundamental consumer rights • Additional rights proposed by consumer advocates • Each proposed right has led to more specific proposals by consumerists

  14. Citizen & Public Actionsto Regulate Marketing • Environmentalism • An organized movement of concerned citizens, businesses and government agencies to protect and improve people’s living environment • Environmental Sustainability • Pollution prevention • Product stewardship • New environmental technologies • Sustainability vision

  15. Citizen & Public Actionsto Regulate Marketing • Public Actions to Regulate Marketing • Major legal issues affect every area of marketing management, including: • Selling and advertising decisions • Channel decisions • Product decisions • Packaging decisions • Price decisions • Competitive reaction decisions

  16. Learning Goals • Understand marketing’s multiple responsibilities, and identify the major social and ethical criticisms of 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

  17. Business Actions Toward Socially Responsible Marketing • Enlightened Marketing • Consumer-Oriented Marketing: • Companies view and organize their marketing activities from the consumer’s point of view. • Innovative Marketing: • Companies seek real product and marketing improvements.

  18. Business Actions Toward Socially Responsible Marketing • Enlightened Marketing • Customer-Value Marketing: • Companies put most of their resources into value-building marketing investments. • Sense-of-Mission Marketing: • Companies define their mission in broad social terms rather than in narrow product terms.

  19. Business Actions Toward Socially Responsible Marketing • Enlightened Marketing • Societal Marketing: • Companies make marketing decisions by considering consumers’ wants, the company’s requirements, consumers’ long-run interests, and society’s long-run interests.

  20. Business Actions Toward Socially Responsible Marketing • Enlightened Marketing • Societal Classification of Products • Deficient products • Pleasing products • Salutary products • Desirable products

  21. Learning Goals • Understand marketing’s multiple responsibilities, and identify the major social and ethical criticisms of 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

  22. Business Actions Toward Socially Responsible Marketing • Marketing Ethics • Corporate marketing ethics policies • Distributor relations, advertising standards, customer service, pricing, product development and general ethical standards • Guiding principle in policy determination • Free market and legal system • Individual companies and managers • International ethical policies are a special challenge

  23. Learning Goals • Understand marketing’s multiple responsibilities, and identify the major social and ethical criticisms of 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