-What is consumerism? -Explain ways by which businesses improve their own practices. -Discuss how ethical issues affect marketers’ professional responsibilities. Chapter 2: Section 3

Marketers cannot think only about selling products and making a profit- they must be aware of the effects of their activities! There is a growing trend for businesses to be socially responsible to aid in solving the problems facing society.

Definition: Concern about the consequences of actions on society. -most business people realized that their business cannot be successful if society is facing major problems in the long run.

Social responsibility practices have been growing in three major ways 1. Consumerism 2. Government Regulation 3. Improving Business Practices

Businesses Government Consumers Consumers, Businesses, and Government all must play a role in improving society.

Consumerism: the organized actions of groups of consumers seeking to increase their influence on business practices. Consumers have become very active in ensuring their rights are protected through: Consumer education, lobbying in government, and product boycotts.

Consumer groups develop materials and educational programs to use in schools and in other places to help people become better consumers. -Programs might include information on how to use banking services, purchase insurance, and apply for loans. There are consumer organizations that will test products and determine whether they are safe and a good value for the price, and they publish results to the public.

Consumer lobbyists work with national and state legislatures to develop laws to protect consumer rights. (American examples below) Sherman Anti Trust Act To increase competition among businesses by regulating monopolies Consumer Product Safety Act To set safety standards and form Consumer Product Safety Commission. Americans with Disabilities Act To prohibit discrimination and ensure equal opportunity for persons with disability.

Does anyone know what the consumer rights and protection laws are like in Kosova? Do they exist? What do they say?

Consumers can also influence business practices by the way they spend their money. If a group of consumers is dissatisfied with the actions or products of a company they can organize a consumer boycott. Boycott: an organized effort to influence a company by refusing purchase its products. Can you think of any famous or very successful boycotts?

Consumer groups can also reinforce positive business practices by encouraging members to purchase products from businesses that respond to consumer needs

Consumerism can influence government regulation of businesses, the second way businesses are becoming more socially responsible. In the US and around the world, governments play an active role in business practices. -Many laws are made to improve the social impact of businesses, while some are specifically made to protect consumers and their rights.

Individual businesses and organizations are working to improve business practices in several ways including -Codes of ethics -Self-Regulation -Social Action

A code of ethics is a statement of responsibilities for honest and proper conduct. Businesses attempt to influence employee behavior by agreeing upon standards of conduct. See American Marketing Associations’ Code of Ethics and handout ges/statement%20of%20ethics.aspx

Do you think it is important for our school store to develop a code of ethics? Why or why not? Who should be responsible for developing this code of ethics if we did want to create one?

Businesses have developed procedures to respond to consumer problems and encourage customers to work directly with the business to solve problems Taking personal responsibility for actions is known as self regulation. -Many businesses have consumer service departments that work to solve consumer problems and provide consumers with info on the company and products.

Business people are sometimes active in helping to solve some of society’s most serious problems by using business resources. -Bill Gates: the Gates Foundation Total grant payments since inception: $26.1 billion to help global health and development. Can you think of other examples?

Ethics: decisions and behavior based on honest and fair standards. (Think back to our business ethics unit!) Marketers have a special ethical responsibilities to customers because they deal directly with them to satisfy their needs. Since people place a high value on ethical behavior it is very important that business people are honest and fair in their dealings with customers, employees, and other businesses.