Marketing 3 Ethics and the Marketing Environment

3.1 Ethics and the Marketing Environment - 3 Corporate Social Responsibility Corporate Social Responsibility Ethical Behavior in Business Ethical Behavior in Business External Environment External Environment Social Forces Social Forces Technological Factors Technological Factors Political and Legal Factors Political and Legal Factors

3.18 Corporate Social Responsibility (CSR) Sustainability Sustainability –Must have a healthy society to sustain business. Pyramid of CSR Pyramid of CSR –Economic Be profitable. Must survive. Be profitable. Must survive. –Legal Obey the law. Obey the law. –Ethical Do what is right, just and fair. Do what is right, just and fair. Avoid harm. Avoid harm. –Philanthropic Good corporate citizen. Good corporate citizen. Contribute resources to community. Contribute resources to community.

3.15 Marketing Ethics I Definition??? Definition???

3.15 Marketing Ethics II Definition Definition –Moral principles or values that generally govern the conduct of an individual or group. –The standard of behavior by which conduct is judged.

3.15 Marketing Ethics III Morals Morals –Rules that people develop as a result of cultural values and norms. –A foundation of ethical behavior.

3.15 Marketing Ethics IV Developing a personal set of ethics Developing a personal set of ethics –Consequence based Who is helped/hurt? Who is helped/hurt? How long will consequences last? How long will consequences last? Greatest good for greatest number of people. Greatest good for greatest number of people.

3.15 Marketing Ethics V Developing a personal set of ethics Developing a personal set of ethics –Rules based Customs Customs Laws Laws Professional standards Professional standards Common sense Common sense –Do unto others…

3.15 Marketing Ethics VI Developing a personal set of ethics Developing a personal set of ethics –Moral character development Pre-conventional Morality: Will I be punished or rewarded? (Most primitive.) Pre-conventional Morality: Will I be punished or rewarded? (Most primitive.) Conventional Morality: What does society view my behavior? Conventional Morality: What does society view my behavior? Post-conventional Morality: Regardless of what others think, what is right and wrong? Post-conventional Morality: Regardless of what others think, what is right and wrong?

3.15 Marketing Ethics VII Why worry about ethics? Why worry about ethics? Difficulties with ethics Difficulties with ethics

3.16 Ethical Guidelines Code of Ethics Code of Ethics –More than “Stay out of jail.” –Can set standard, control behavior and decisions, minimize confusion. –Must train employees. –Must live up to code. Enron had a 65 page code of ethics. Enron had a 65 page code of ethics. Ethical Checklist Ethical Checklist See Exhibit 3.2, pg. 74 See Exhibit 3.2, pg. 74

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3.2 The Marketing Environment I n Uncontrollable n Must be monitored  Environmental Scanning n Must be anticipated n Always changing, dynamic, constant state of flux. n Affects customer demand and how to satisfy that demand.

3.2 The Marketing Environment II n Social Change n Economic Conditions n Political/Legal n Competition n Demographics n Technology

3.3 Major Factors Affecting Marketing Change is constant and rapid Change is constant and rapid Competition is global Competition is global Technology is dramatically changing marketing exchanges Technology is dramatically changing marketing exchanges Collaboration is as important as competition Collaboration is as important as competition Quality isn’t optional, it’s standard Quality isn’t optional, it’s standard Focus is on the individual Focus is on the individual Ethical and social responsibility Ethical and social responsibility

3.4 Managing the Marketing Environment Reactive: taking steps to adapt to environmental factors that can not be controlled or influenced Proactive: seek ways to influence your environment when you think you can influence certain factors

3.5 Analyzing the Environment Environmental scanning Environmental scanning Identify opportunities and threats Identify opportunities and threats Make decisions based on the gathered information Make decisions based on the gathered information

3.6 Social Forces American Values American Values –Self sufficiency; upward mobility, work ethic, equality –Time dependent –Values influence purchasing Component Lifestyles Component Lifestyles –Banker/Gourmet/athlete Changing Role of Family/Women Changing Role of Family/Women –Working Women –Later, Smaller/No Families –Dinks

3.7 Demographic Factors Demography Demography Age, race, ethnicity, education, location Age, race, ethnicity, education, location Generation Y 1979 – 1994 Generation Y 1979 – 1994 Generation X 1965 – 1978 Generation X 1965 – 1978 Baby Boomers 1946 – 1964 Baby Boomers 1946 – 1964 –(YEAH Baby!!!) Older consumers Older consumers Population Shifts Population Shifts

Demographic Factors Growing ethnic markets Growing ethnic markets –Hispanic (12.5%) $900 B –African American (12.3%) $850 B –Asian American (3.6%) $455 B

3.8 U.S. Population by Race and Ethnic Group Asian 4% 6% 8% African American 12% 13%14% Hispanic12% 18%24% American Indian 1% 1% 1% White71% 62%53%

3.10 Marketing Implications of Multiculturalism Multiculturalism Multiculturalism –US is becoming more diverse Research is important Research is important More specialized marketing More specialized marketing More diversity in mainstream marketing More diversity in mainstream marketing

3.11 Economic Factors Rising incomes Rising incomes –National, Global Purchasing power Purchasing power Inflation Inflation Recession Recession

3.12 Technological Factors Information technology Information technology Internet Internet Research Research

3.13 Political and Legal Environment Federal Laws Federal Laws State Laws State Laws Regulatory Agencies Regulatory Agencies –FTC –FDA

3.14 Competitive Factors Market Share and Profits Market Share and Profits Domestic Domestic Global Global –Impact of Terrorism on business