Ethics in Marketing
Marketing refers to the process of carrying out marketing research and selling of products and services to the customers. In addition, marketing refers to promoting of goods and services through advertising. Companies carry out marketing to enhance their sales. Marketing derives the strategy that underlies sales techniques and business development. It also underlies business communication. Marketing is an integrated process that enables companies to improve customer relationships. It also helps the company to develop customer relations. Additionally, marketing helps create value for the buyers and the companies. Marketing in most companies is used to determine the customers and enhance customer satisfaction and maintain the customers. Marketing management is one of the major elements of business management. Marketing is governed by marketing ethics. The marketing ethics ensure the companies market their products in an ethical manner. It also helps the company advertise and promote their products well. This paper analyzes ethics in marketing.
Reasons why companies have integrated ethics in marketing process
Marketing has evolved greatly to meet the developing markets and customer needs. This has forced many businesses to develop the right marketing strategies to market their products. The marketing strategies have helped companies shift from production to providing goods and services need by the customers (Schlegelmilch, 1998). Ethics refers to a series of principles of right conduct that determine the decisions made by people or companies. Practicing ethics in marketing implies applying various standards. For example, it involves applying standards of fairness. It also involves applying moral rights like what is good or bad to marketing decisions, marketing behaviors and practices in the company. In market economy, businesses are expected to act in what they believe to be their own interests (Schlegelmilch, 1998). Hence, businesses use marketing to achieve competitive advantage. A firm achieves competitive advantage when it achieves higher sales and market share than its competitors n, addition, a firm achieves competitive advantage if it able to satisfy the service requirements and product requirements of its target market.
Companies that develop competitive advantage are able to satisfy customer needs and the organizational needs like high sales. The economic system has become more successful in providing goods and services to the customers. This has forced organizations to adhere to ethical values, but not providing products only (Schlegelmilch, 1998). There are various factors that have forced organizations to focus on ethical values, but not provision of goods and services. First, businesses focus on ethics when marketing products to attract customers. Organizations that behave ethically have more customers than organizations that do not behave ethically. This is because the organizations encourage customers to develop positive attitude towards its products and services. This in turn increases sales. On the other hand, organizations that do not encourage ethics in marketing find it hard to satisfy their customers. In this case, the customers are dissatisfied with the goods and services offered by the company and this leads to low sales. In addition, when marketing practices depart from the marketing standards set, then the marketing process is affected and it becomes less efficient. In other cases, the marketing process can be disrupted completely. This in turn affects profits in the organization (Schlegelmilch, 1998).
Moreover, companies encourage ethics in marketing to protect their publicity. Lack of good marketing practices affects publicity (Schlegelmilch, 1998). This makes it difficulty for the customers to buy products and services from the company. Also, it leads to lack of trust as customers no longer trust the company. Most businesses have lost customer trust because of poor marketing practices. For instance, the companies have lost customer trust because of developing adverts that are not ethical. Also, the companies have lost customer trust by developing products that affect customers negatively. This has in turn forced companies to integrate ethics in their marketing practices so as to improve trust and publicity. Other companies have integrated ethics in marketing so as to restore their businesses and prevent businesses from collapsing. Lack of ethics in marketing leads to closure of businesses (Schlegelmilch, 1998). This is because the business do not have enough customers, hence low sales or no sales at all. Ethics in marketing has helped overcome such issues and encourage business growth. Further, most companies focus on ethics so as to avoid legal suits. Ethical abuses affect organizations negatively. This is because the organizations are held accountable for their actions. Many businesses have faced legal suits because of unethical marketing practices. This has led to loss of customers and damage to the public image of the company. It has also led to low profits and closure of businesses.
Application of ethics in different areas of marketing
Marketing ethics focuses on moral principles that govern marketing operations and regulation of marketing. Companies are required to apply ethics in different areas. For example, the companies are supposed to apply ethics in promotion, advertising and distribution of products (Schlegelmilch, 1998). They are also supposed to apply ethics in pricing of product. The different areas of marketing ethics are related to media ethics. This is because companies use different media to market their products and services and also promote them. Companies are supposed to ensure the advertising and promotion of products and services is ethical. For instance, the companies are supposed to tell the public the truth (Schlegelmilch, 1998). They are also supposed to be honest. In this case, the companies are not allowed to give the positive aspects of the products and services, but also the negative effects of the product or services. This will make it easy for the customer to make the right decision and choice. For example, a company advertising tobacco should state the negative effects of the product alongside the importance of the product. In 1940 and 1950, most companies advertising tobacco argued that tobacco is good as it promotes health. The companies did not state the effects of the product. Currently, companies advertising tobacco are required to tell the truth. Failure to tell the truth is considered not morally right and also against the law. This can lead to a law suit (Schlegelmilch, 1998).
In addition, companies are not allowed to use offensive language, materials when advertising and promoting their products. Markets should control what they convey to customers and how they convey the message. This is to ensue the marketing process is ethical (Schlegelmilch, 1998). Marketing media like televisions, radios and publications are supposed to use the right language and materials. In addition, the products and promotional materials should be written using the right language. Televisions, radios and publications sponsored that contain offensive materials and language affects the perception of the customer towards the product and company. The materials create a negative reaction. This in turn affects the marketing process and sales. People have different views about adverts and promotions and the kind of language used. For instance, some people find advertising of products that contain sexual information offensive (Schlegelmilch, 1998). Others find promotions and adverts that use stereotyping images and sex appealing. These customers are more likely to buy the product as it meets their needs. On the other hand, customers who find sex offensive are not likely to buy the product. This mostly common when a company is marketing its products and services in other countries where the images and the words have a different meaning from the home country .This hinders the marketing of the product. People who feel the product is offensive may encourage other customers not to buy the products. This makes it hard for the company to achieve the marketing goals. Thus, companies should screen and test the message before advertising the product so as to ensure the message is written using the right language. Additionally, the companies should ensure the content selected matches the tastes and interests of the target market. This will ensure the product language used is appealing to the customers, hence lead to high sales (Horowitz, 2006).
Companies carrying out direct marketing should examine the message and the materials well. Direct marketing has become a major issue. Most of the practices used in direct marketing affect the customer negatively. For example, persistent selling and high pressure selling might affect the customer. Also, marketing appeals that target young children and in experienced customers are considered morally wrong as they affect them. So, the companies should ensure direct marketing is inline with the standards set (Horowitz, 2006).
The companies are not allowed to use negative advertising techniques like attack ads. In negative advertising, the company highlights the demerits of competitors’ product instead of stating the advantages of the company’s product. Negative advertising can affect the reputation of the company and even lead to law suits. The companies should ensure the advertising messages or promotions do not convey bad things about the competitors. Instead, the advert should state the strengths of the product or service being advertised. This will help protect the image of the company and avoid law suits (Horowitz, 2006)
Ethics is also applicable in distribution channels. Distribution channel refers to a chain of intermediaries used to distribute the products. The products follow different channels when being distributed (Horowitz, 2006). The parties involved in the distribution of products play different roles. There are various channels of distribution like distributors and retailers. Ethical questions arise during distribution. This is because marketing representatives and sales personals are evaluated according to the amount of sales. This leads to ethical dilemmas as the marketing representatives and sales people go against the marketing rules. For instance, they pressure the vendors to buy more than they need. This affects the customers negatively and affects sales. Also, the marketing representatives and sales people can force vendors to use their products instead of competitor’s products. This is leads to ethical issues in the company. Various products related issue has raised questions about ethics in marketing. The questions are related to quality of products and services being advertised. Most companies market poor quality products. They also market unsafe products. The product does not contain the content that is being marketed. This affects the customer safety. Companies that market unsafe products are more likely to face legal suits and loose customers. The company should ensure the product being marketed is safe and of good quality (Horowitz, 2006).
Further, Ethics is applicable in pricing. Pricing is one of the components of marketing mix. There are various pricing practices that are considered unethical. Examples include price discrimination and price skimming. Other practices include variable pricing, supra competitive pricing and predatory pricing (Horowitz, 2006).. Price discrimination occurs when the identical goods or services provided by one provider are sold at diffident prices. Price differentiation occurs mostly in companies that have high market share. It also occurs in monopolistic markets. The seller tries to sell the goods at different prices. In addition, price discrimination occurs when a seller sale the product at same prices to customers having different supply costs. Price discrimination has adverse effects on consumers. For example, it leads to low prices for some customers and high prices for others. The company should ensure prices set by the company are fair. The company should not encourage price differentiation as it will affect sales in the company (Horowitz, 2006).
Price fixing is considered to be an agreement between two or more participants in a market. The parties agree to buy and sell products at a fixed price. Also, the parties decide to maintain market conditions so as to ensure the price is maintained at a certain level. This enables them to control supply and demand. Price fixing affects customer as most customers are not satisfied with the price (Horowitz, 2006).
Marketing practices that are deceptive can affect customer and the organization negatively. The practices make customers believe that they will get more value from the products and services than expected (Horowitz, 2006). Deception can take various forms. For example, it can be a misinterpretation and omission. It can also be a practice that is misleading. Deception can occur during marketing mix. This is because consumers are exposed to a wide range of information about products and the company. This makes it difficulty for the consumers to be protected from exploitation. When the product does not serve the right purpose, consumers seek alternative sources. In most cases, deceptive pricing strategies cause consumers to believe that the price of the products and services is low than it really is (Horowitz, 2006).
The companies can make false price comparisons and providing wrong information about the selling information. In addition, the company can omit important conditions that should be followed when selling the product or services. Also, the company can sell the products at a lower price than expected (Horowitz, 2006). Promotion activities are considered deceptive when the company misstates how the product is developed or performs. Also, the promotion techniques are deceptive if the company offers to sale the product at a lower cost to attract customers and later change the cost of the product, hence encouraging them to buy the product at a high cost. Exaggerated product claims are considered deceptive. For instance, the company can mislabel the product intentionally by stating the wrong contents, size and weight. Also, the company can use deceptive package to attract customers. Hence, such behaviors are considered unethical as they affect the customers and the company. It can lead to loose of customers if the customers know the truth about the product and services (Horowitz, 2006).
Ethical issues in marketing
Ethics in marketing has become a major issue in the society. This is because of the ethical issues associated withy marketing. There are various ethical issues that are related to marketing like targeting young children and minorities when marketing. In many countries children are the main targets for certain goods (Brenkert, 2008). Most companies target young children when marketing product because they do not have enough knowledge. A large percentage of young children do not know more about the products, media and selling menthols used by the companies. This makes the young children more prone to marketing companies. Youngsters are more prone to psychological appeals and images. The young children are regularly exposed to marketing messages and tactics.
The messages and tactics may have negative effects on the children. For instance, studies have shown that children are more prone to food advertise and substance advertises like tobacco and alcohol (Brenkert, 2008).. The target for young children has forced governments to develop laws to govern advertising of certain products. For example, the governments have developed laws to prevent marketing of alcohol and tobacco. This is to ensure the children are not targeted by marketing companies. For example, the United States government has established laws to govern marketing to young children. The federal regulations limit the kind of marketing that can be directed to young children. This is to prevent the companies from affecting young children. In addition, other organizations like better business bureau and federal trade commission control marketing of products in the country. The agencies have enacted laws that control marketing activities in the country. This has helped provide guidance to marketers. Companies are required to adhere to the rules set by the organizations above. Also, the companies should ensure the marketing strategies used do not affect young children (Brenkert, 2008).
Another issue is marketing to minorities. The population in united stages has become diverse for the last six decades. Marketing to minorities has become a concern in the country. Markets in the country are divided into different segments in which the residents share similar characteristics (Brenkert, 2008). In this case, ethical issues arise when marketing strategies are designed to exploit a market segment occupied by minorities. Most companies may find it difficulty to develop marketing strategies that do not encourage discrimination. This leads to offensive practices like stereotypical, representation of the population. Also, it can lead to association of dangerous products with the minority region. This affects the minorities negatively and leads to negative reaction. Thus, affecting the sales in the company. Moreover, ethical issues may arise if the company directs high pressure selling to the population (Brenkert, 2008). Also, charging high process for products sold to minority groups is considered as an ethical issue. This is because it leads to price differentiation.
Price differentiation is an ethical issue as stated above. The minority groups get poor or dissatisfying services compared to other groups in the country. Also, ethical issues arise when stores sell poor products and offer polypro services to the minority groups. Such practices affect the public image of the company and lead to low profits. Though the government has enacted laws to protect young children from being exploited by marketing companies, there are few laws that protect minority groups. So, when targeting minority groups, companies should determine if the population targeted is prone to appeals because of their status. This will help the company use the right marketing strategy. Further, the companies should asses marketing efforts to determine if the ethical behaviors would cause the company to change the marketing activities. Hence, this will help the company offer satisfactory services and attract customers. It will also help the company avoid law suits (Brenkert, 2008).
Portrayal of women in advertisements has become an issue. People have different views about how women are portrayed in advisements. Some think this makes women inferior and affects their dignity. Women have been portrayed differently in advertisements for the last few years. Marketers present the images differently and some people see them as stereotyping and offensive. For example, marketers present the images as oversimplified. The way the women are portrayed affects the marketing of the products. Harmful stereotyping includes portraying women as obsessed with their appearance and conforming to their size and beauty. When people consider such images as harmful. This affects the organization negatively. Advertisements should be evaluated to ensure the content aired is not offensive. This will ensure the companies do not face ethical issues (Brenkert, 2008).
Marketing research is also an issue. Gathering information from the customers may not be easy and this affects the marketing of the products and services. There are various factors that affect collection of information (Brenkert, 2008). First, consumers may feel that the company is affecting their privacy when collecting data. This makes it hard for the customers to give personal information that may make them to be marketing target. This in turn hinders the development of marketing strategies. Also, the consumers may not be pleased with the methods used to obtain data. Failure to collect enough data affects decision making in the company. Companies are supposed to make ethical decisions. The decisions made should not affect customers negatively. Also, the decisions made should not encourage biasness. Lack of enough data makes it hard to make ethical decisions. Hence, it affects marketing in the organization (Brenkert, 2008).
Ethics in marketing is important as it helps prevent practices and behaviors that affect marketing activities and consumers. Ethics is used to determine if something is right or wrong. This helps make the right decisions and prevent ethical issues. In marketing ethics is applied in diffident areas. For example, ethics is applied in advertising and promotions. In addition, ethics is applied in pricing. In advertising, organizations are supposed to scrutinize the content of the advertisement before airing it. Also, they are supposed to ensure the message is written using the right language. Advertisements should not be offensive as this affects customers and hence organizations. The advertisement messages should be developed according to the needs of the target marked. This is because different people have different views on advertisements. The advertisements should not be deceptive. For example, the adverts should not offer low prices so as to target a certain population. Also, the promotions should be developed correctly to avoid affecting the customers. The company should not encourage price differentiation as it is considered unethical. The company should ensure the price set is fair. There are various ethical issues that result from lack of ethics. Most advertisements and promotions target young children and minorities. For example, alcohol and cigar fate advertisements target young children. The adverts affect the children negatively. Also, the adverts target minority groups and women. The company should develop marketing strategies that are not offensive and stereotyping. Most companies have established rules to govern marketing in the organizations. The rules help prevent the company from facing law suits. This is because the company makes ethical decisions. Also, the rules help ensure customer satisfaction and attract customers.
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