© 2009 South-Western, Cengage LearningMARKETING 1 Chapter 2 SOCIALLY RESPONSIVE MARKETING 2-1The Impact of Marketing 2-2Criticisms of Marketing 2-3Increasing Social Responsibility CHAPTER 2

MARKETING Chapter 2 2 Focus Questions: What message is being communicated by Waste Management in this advertisement? Do you think the message is effective? How does it demonstrate social responsibility? ©WASTE MANAGEMENT

MARKETING Chapter 2 3 THE IMPACT OF MARKETING GOALS Explain how marketing affects businesses. Describe marketing’s impact on individuals. Discuss ways marketing benefits society. 2-1

© 2009 South-Western, Cengage LearningMARKETING 4 Chapter 2 SOCIALLY RESPONSIVE MARKETING Marketing Matters pg 36 3 columns – in each column include all the questions you may have asked yourself before making this purchase. At the bottom write a summary of why you chose to ask those questions, and why the questions differed from product to product. CHAPTER 2

MARKETING Chapter 2 5 Marketing Affects Businesses Many people question the value of Marketing Adds to the cost of products Encourages people to buy things they really do not want or need Build a good product/service no need

MARKETING Chapter 2 6 Marketing Affects Businesses Critical business function Customer satisfaction

MARKETING Chapter 2 7 Marketing Affects Businesses Critical business function Marketing is responsible for the activities leading to the exchange of a business’s products and services for the customer’s money Identify and understand customers, attitudes, likes and dislikes Marketing Information Systems, Market Research Develops Products and Services for customers at a profit

MARKETING Chapter 2 8 Marketing Affects Businesses Customer satisfaction Satisfy customer wants and needs (Tide) Helps business makes better decisions about what to sell and how to sell it (retail) Customers are likely to be more loyal and continue to purchase from the business

MARKETING Chapter 2 9 Marketing Helps People Better products at a lower cost Expanded opportunities

MARKETING Chapter 2 10 Marketing Helps People Individuals benefit from marketing because it improves the exchange between business and customers

MARKETING Chapter 2 11 Marketing Helps People Here is an example of its value Consider going to a supermarket to buy party supplies

MARKETING Chapter 2 12 Marketing Helps People Here is an example of its value Consider going to a supermarket to buy party supplies You want the store to be conveniently located, adequately supply decorations, drinks, snacks, have easily located products, prices clearly marked, etc… Each of those activities is an example of marketing, and make it easier for you to shop The business benefits because you purchase the product, and you benefit because your needs were satisfied

MARKETING Chapter 2 13 Marketing Helps People Better products at a lower cost cell phones Expanded opportunities ¼ to 1/3 of all jobs in the U.S.

© 2009 South-Western, Cengage LearningMARKETING Does Marketing Benefits Society? 14 Chapter 2

MARKETING 15 Marketing Benefits Society New and better products Better standards of living Improved international trade

MARKETING Chapter 2 16 Marketing Benefits Society New and better products Marketing encourages business to provide products and services that customers want More efficient automobiles Biodegradable products Airbags, Self-Driving Cars

MARKETING Chapter 2 17 Marketing Benefits Society Better standards of living Based on the products and services available to customers Amount of resources consumers have to obtain for the products/services Quality of life for consumers

MARKETING Chapter 2 18 Marketing Benefits Society Improved international trade Sale of products and services to people in other countries Marketers help to determine where products can be sold, how to sell in countries that have different business procedures, money system and buying practice Shipping, Product Handling, Customer Service, Promotional methods

MARKETING Chapter 2 19 Benefits of Marketing Businesses meet consumer needs Consumers make better decisions Natural resources are used more effectively Standard of living is improved International trade increases

MARKETING Chapter 2 20 CRITICISMS OF MARKETING Thoughts How does marketing help the environment? Why is a business that is committed to long term customer relationships less likely to use high-pressure sales tactics? 2-2

MARKETING Chapter 2 21 CRITICISMS OF MARKETING GOALS Discuss three common criticisms of marketing. Explain how marketing can be used to solve social problems. 2-2

MARKETING Chapter 2 22 Common Complaints Marketing causes unneeded purchases Marketing wastes money Marketing is not always needed

MARKETING Chapter 2 23 Common Complaints Marketing causes unneeded purchases Products are readily available Packaged to attract attention Advertising to encourage specific brands Credit and Special Financing

MARKETING Chapter 2 24 Common Complaints Countered Marketing causes unneeded purchases Dissatisfied customer Return item – lost sale Tell other people not to purchase Reduction in profit No relationship with customers

MARKETING Chapter 2 25 Common Complaints Marketing causes unneeded purchases Marketing wastes money Marketing is not always needed

MARKETING Chapter 2 26 Total product price (100%) Product Price Average cost of all marketing activities (50%) Average cost of sales and advertising (2–10%) The Typical Costs of Marketing

MARKETING Chapter 2 27 Common Complaints Countered Marketing wastes money Products can be sold to more customers Increased competition Lowest price

MARKETING Chapter 2 28 Common Complaints Marketing causes unneeded purchases Marketing wastes money Marketing is not always needed Can you think of a product that does not need marketing?

MARKETING Chapter 2 29 Common Complaints Marketing is not always needed Can you think of a product that does not need marketing?

MARKETING Chapter 2 30 Common Complaints Countered Marketing is not always needed If no marketing the customer would be responsible to complete the activities to purchase a product. Find the product Pay cash Transportation Risk

MARKETING Chapter 2 31 Marketing Solves Problems Marketing increases public awareness Marketing helps match supply with demand

MARKETING Chapter 2 32 Marketing Solves Problems Marketing increases public awareness Communication on issues Encouraged to take action Green (environmental) marketing

MARKETING Chapter 2 33 Marketing Solves Problems Marketing helps match supply with demand Transportation

MARKETING Chapter 2 34 INCREASING SOCIAL RESPONSIBILITY GOALS Define consumerism. Explain ways by which businesses improve their own practices. Discuss how ethical issues affect marketers’ professional responsibilities. 2-3

MARKETING Chapter 2 35 Consumer Protection The trend today is greater expectation for businesses to be socially responsible and to aid in solving problems facing society Social responsibility: concerns about the consequences of actions on others. When making decisions, business people realize that they must consider factors beyond what their customers want and a profit Increasing social responsibility of a business is occurring three major ways

MARKETING Chapter 2 36 Consumer Protection The growth of consumerism Government regulation Improving Business Practice

MARKETING Chapter 2 37 Social Responsibility Must Be Shared BUSINESS GOVERNMENT CONSUMER GROUPS

MARKETING Chapter 2 38 Consumer Protection The growth of consumerism Consumerism is the organized actions of groups of consumers seeking to increase their influence on business practices. Consumers have little influence alone, but when organized as a group consumers have a much greater impact Consumer bill of rights Right to adequate information, safe products, product choices & to communicate ideas and opinions Boycott is an organized effort to influence a company by refusing to purchase its products

MARKETING Chapter 2 39 Consumer Protection The growth of consumerism Government regulation Improving Business Practice

MARKETING Chapter 2 40 Consumer Protection Government regulation Make laws designed to improve social impact of business practices Businesses must comply with consumer protection laws or risk fines and a loss of business

MARKETING Chapter 2 41 Sherman Antitrust Act, 1890 To increase competition among businesses by regulating monopolies

MARKETING Chapter 2 42 Food and Drug Act, 1906 To control the content and labeling of food and drug products by forming the Food and Drug Administration (FDA)

MARKETING Chapter 2 43 Federal Trade Commission Act, 1914 To form the Federal Trade Commission (FTC) to protect consumer rights

MARKETING Chapter 2 44 Robinson-Patman Act, 1936 To protect small businesses from unfair pricing practices between manufacturers and large businesses

MARKETING Chapter 2 45 Fair Packaging and Labeling Act, 1966 To require packages to be accurately labeled and fairly represent the contents

MARKETING Chapter 2 46 Consumer Credit Protection Act, 1968 To require disclosure of credit requirements and rates to loan applicants

MARKETING Chapter 2 47 Consumer Product Safety Act, 1972 To set safety standards and to form the Consumer Product Safety Commission (CPSC)

MARKETING Chapter 2 48 Americans with Disabilities Act, 1990 To prohibit discrimination and ensure equal opportunity for persons with disabilities

MARKETING Chapter 2 49 Telemarketing and Consumer Fraud and Abuse Prevention Act, 1994 To prohibit deceptive telemarketing practices and regulate calls made to consumers’ homes

MARKETING Chapter 2 50 Millennium Digital Commerce Act, 1999 To regulate the use of electronic contracts and signatures for Internet business transactions

MARKETING Chapter 2 51 Gramm-Leach-Bliley Financial Modernization Act, 1999 To limit the sharing of consumer information by requiring financial services companies to inform consumers about how private information is handled

MARKETING Chapter 2 52 Consumer Protection The growth of consumerism Government regulation Improving Business Practice

MARKETING Chapter 2 53 Consumer Protection Improving Business Practice Business recognize their responsibility to consumers and to society because … Customers will stop buying the product If a social problem exists the government may increase tax to pay for programs Business do not want increase regulation of taxes

MARKETING Chapter 2 54 Improving Practices Codes of ethics Self-regulation Social action

MARKETING Chapter 2 55 Improving Practices Ethics Are moral principles or values based on honesty and fairness. Codes of ethics a set of standards or rules that guide ethical business behavior.

MARKETING Chapter 2 56 Improving Practices Codes of ethics Encourages honest and proper conduct They agree on standards of conduct to encourage this responsible behavior Codes can be influence by penalties by the industry AMA describes specific responsibilities for marketers in the 4 P’s area

MARKETING Chapter 2 57 Responsibilities of the Marketer In product development and management In promotions In distribution In pricing In marketing research

MARKETING Chapter 2 58 Responsibilities of the Marketer Product development and management Disclosing all substantial risks associated with a product or service Identifying substitutions that change the product or impact buying decisions Identifying extra cost-added features

MARKETING Chapter 2 59 Responsibilities of the Marketer Promotions Avoiding false and misleading advertising Rejecting high-pressure or misleading sales tactics and promotions

MARKETING Chapter 2 60 Responsibilities of the Marketer Distribution Not exploiting customers by manipulating the availability of a product Not using coercion Not exerting undue influence over the reseller’s choice to handle a product

MARKETING Chapter 2 61 Responsibilities of the Marketer Pricing Not engaging in price fixing Not practicing predatory pricing Disclosing the full price associated with any purchase

MARKETING Chapter 2 62 Responsibilities of the Marketer Marketing research Prohibiting selling or fundraising disguised as conducting research Avoiding misrepresentation and omission of pertinent research data Treating clients and suppliers fairly

MARKETING Chapter 2 63 Improving Practices Self-regulation Taking personal responsibility for actions. Better Business Bureau is a customer protection organization sponsored by business to gather information from consumers about problems, provide information about improper business practices, and attempt to solve problems between businesses and their customers. Consumer Service Departments

MARKETING Chapter 2 64 Improving Practices Social action Business people are concerned about the world in which they live so they invest time and money to help their communities. Ronald McDonald’s House Avaya

MARKETING Chapter 2 65 Ethics in Marketing Responsibility to customers Harm and accountability