Week 10 Marketing and Society

Ethics are defined as standards of conduct and moral judgment (Andreasen 2001).
Business ethics encompass the values, standards, and principles applicable to commercial and non-commercial business activities.
Marketing ethics systematically studies how moral standards are applied to marketing decisions, behaviors, and institutions (Murphy et al. 2005).

Normative Approach: Prescribes ethical standards and offers guidelines for marketing practices.
Positive Approach: Describes and understands ethical practices through empirical work.
7 Perspectives Guiding Ethical Marketing (Laczniak and Murphy 2006):
- Ethical marketing prioritizes people.
- Ethical marketers exceed legal behavioral standards.
- Marketers are responsible for intended means and ends in marketing actions.
- Marketing organizations should cultivate higher moral imagination in managers and employees.
- Marketers should embrace a core set of ethical principles.
- Adopting a stakeholder orientation is essential for ethical marketing decisions.
- Marketing organizations should delineate an ethical decision-making protocol.

Products and brands face ethical scrutiny due to their visibility.
Environmental protection is a crucial ethical consideration in product management.
A life cycle assessment measures environmental impact, considering resource consumption and waste generation.
Life Cycle Stages:
- Design stage
- Production stage
- Use stage
- Disposal stage

A life cycle approach assesses the health and safety impact of products.
- Design Stage: Design products safe for consumers.
- Production Stage: Address worker health and safety.
- Use Stage: Consider user incompetence.
- Disposal Stage: Manage potential health and safety failures and product recalls.
Australian safety issues are documented at https://www.productsafety.gov.au/.

Consumers often lack sufficient information for informed purchases.
Ethical marketing promotes relevant information and clear consumer understanding.
Misleading claims can lead consumers to infer benefits a product doesn't possess, creating a 'health halo' effect (Chandon 2013).
Slack packaging involves using large packages to overstate product quantity (Ameer 2013).
Labels must be accurate and reliable to avoid misleading consumers.

The acceptability of promoting products causing harm, ill-health, and death (e.g., fast food, tobacco) is debated.
These products contribute to non-communicable diseases, a leading cause of global ill-health and death.
Social, economic, and marketing cues impact the consumption of harmful products.
Marketers of these products may resist regulation and develop new marketing strategies to encourage consumption.

Two Key Approaches:
- Voluntariness should determine just exchanges and prices.
- Equivalence between price and value is needed.
Other Approaches:
- Hypothetical Market Price
- Non-exploitative Prices
- Affordability
- Fair trade
- Cost plus
- Avoidance of an unrestrained profit motive

Decoy pricing: Strategically pricing products to influence consumer choice towards desired items.
Price gouging: Setting prices unreasonably high.
Price collusion: Agreement between firms on pricing.
Price discrimination: Different prices for different groups or distribution systems.

Advertising serves societal functions but faces criticism at two levels:
- Micro Level: Content and type of advertising messages.
- Macro Level: Wider effects on society.
A key debate concerns whether advertising reflects or molds reality.

Deception is a major point of criticism in marketing.
Deception Defined: any act, claim, or message that:
- Causes consumers to make decisions they would not otherwise make.
- Leads consumers to believe something untrue about a product.
- Fosters distrust or erodes ethical values (Aditya 2001).
- Creates a false or inaccurate overall impression (ACCC 2020).
Deception is perceived as an inherent and increasing element in marketing (Kimmel 2001), especially in marketing communications.

Covert marketing is deceptive due to its concealed nature.
It involves hiding the message's source and marketing intent (Skiba et al. 2019); also referred to as 'native advertising'.
Examples:
- Brand pushers or posers
- Buzz and viral marketing
- Product placements

Marketers seek innovative ways to reach audiences, often leading to intrusion and clutter.
Advertising clutter has increased in the contemporary cultural landscape.
Technology exacerbates this (e.g., digital billboards, floor animation).

Threatening messages in advertisements aim to drive audiences toward a goal (LaTour, Snipes, and Bliss 1996), prompting behavioral change (Bagozzi and Moore 1994; Bennett 1996).
Fear appeals are criticized as unethical, manipulative, exploitative, eliciting negative responses, and contributing to social norms (Spence and Moinpour 1972).

Marketing communications are often criticized for bad taste and tactics that might offend segments of society (Shimp 2003).
Advertising reflects society in a distorted mirror (Pollay and Gallagher 1990).
Offensive marketing communications are generally unsuccessful (Hoffbrand 2008).

Digital marketing's growth raises data privacy and security concerns.
'Big data' and consumer tracking grant companies access to intimate consumer information (Nill et al., 2015).
Data can create tailored products, but concerns exist about privacy invasion and invasive marketing (Boyd and Crawford 2012).
Data security and privacy issues are prevalent on social networking sites.