1. Copyright © 2007 Pearson Education Canada 3-1 Chapter Three Marketing and Society: Social Responsibility and Marketing Ethics with Duane Weaver

2. Copyright © 2007 Pearson Education Canada 3-2 Outline Marketing Issues and Consumers Marketing Ethics and Society Marketing Ethics and Business Consumerism, Seller’s Rights, Legal Marketing, Socially Responsible Marketing Enlightened Marketing Social Classification Marketing Ethics

3. Copyright © 2007 Pearson Education Canada 3-3 Marketing Issues and Consumers Negative impact on individual consumer welfare: –High prices due to costs of distribution, advertising and excessive markups. –Deceptive practices: pricing, promotion. –High-pressure selling. –Shoddy or unsafe products. –Planned obsolescence. –Poor service to disadvantaged customers.

4. Copyright © 2007 Pearson Education Canada 3-4 Marketing Ethics and Society Negative impact on society: –Creating false wants. –Too few social goods. –Cultural pollution. –Too much political power.

5. Copyright © 2007 Pearson Education Canada 3-5 Ethics: Creating False Wants: Charges that we suffer from materialism and over-concern with status. Creates an acquisitive society. Criticisms overstate the power of business to create needs.

6. Copyright © 2007 Pearson Education Canada 3-6 Ethics: Too Few Social Goods Private goods create social ills. –Automobiles create need for more highways, create pollution. Possible ways to create balance. –Make producers pay for social costs such as emission control systems in cars. –Make consumers pay costs such as toll roads or health care premiums for smokers.

7. Copyright © 2007 Pearson Education Canada 3-7 Ethics: Cultural Pollution Constant assault of advertising and promotion on the senses. Average Canadian is exposed to 3000 marketing messages a day. Vicious circle: the more advertising, the more advertisers must find ways to capture our attention.

8. Copyright © 2007 Pearson Education Canada 3-8 Ethics: Too Much Political Power Industries lobby government to promote interests against public good. Advertising spending in the media prevents media from honest journalism about products. Canada has put controls in place to help curb powerful business interests.

9. Copyright © 2007 Pearson Education Canada 3-9 Marketing Ethics and Business Negative impact on other businesses: –Harming competitors. –Reducing competition through acquisitions. –Practices that create barriers to entry. –Unfair competitive marketing practices. All can harm other businesses and reduce competitiveness.

10. Copyright © 2007 Pearson Education Canada 3-10 Consumerism An organized movement of citizens and government agencies to protect the rights of buyers. –The right to safety. –The right to be informed. –The right to choose. –The right to be heard. –The right to redress against damage. –The right to consumer education.

11. Copyright © 2007 Pearson Education Canada 3-11 Seller’s Rights These rights depend on fair and safe practices: –The right to introduce any product in any style and size. –The right to charge any price for the product. –The right to spend any amount to promote the product. –The right to use any product message. –The right to use any buying incentive scheme.

12. Copyright © 2007 Pearson Education Canada 3-12 Environmentalism An organized movement of citizens, businesses and government agencies. –Protect and improve the living environment. –Maximize life quality, rather than consumption, choice or satisfaction. –Strive for environmental sustainability. –Government regulation to support these goals.

13. Copyright © 2007 Pearson Education Canada 3-13 Legal Marketing Decisions Selling decisions. Advertising decisions. Channel decisions. Product/packaging decisions. Pricing decisions. Competitive management decisions.

14. Copyright © 2007 Pearson Education Canada 3-14 Socially Responsible Marketing Five principles of enlightened marketing: 1.Consumer-oriented marketing. 2.Innovative marketing. 3.Value marketing. 4.Sense-of-mission marketing. 5.Societal marketing. Described in coming slides..

15. Copyright © 2007 Pearson Education Canada 3-15 Enlightened Marketing A marketing philosophy holding that a company’s marketing should support the best long-run performance of the marketing system

16. Copyright © 2007 Pearson Education Canada 3-16 Enlightened Marketing 1.Consumer-oriented marketing: –The philosophy of enlightened marketing that holds that the company should view and organize its marketing activities from the consumer’s point of view. 2.Innovative marketing: –A principle of enlightened marketing that requires that a company seek real product and marketing improvements.

17. Copyright © 2007 Pearson Education Canada 3-17 Enlightened Marketing 3.Value marketing: –A principle of enlightened marketing that holds that a company should put most of its resources into value- building marketing investments. 4.Sense-of-mission marketing: –A principle of enlightened marketing that holds that a company should define its mission in broad social terms rather than narrow product terms.

18. Copyright © 2007 Pearson Education Canada 3-18 Enlightened Marketing 5.Societal marketing: –A principle of enlightened marketing that holds that a company should make marketing decisions by considering consumers’ wants, the company’s requirements, consumers’ long-run interests and society’s long-run interests. –Similar to the societal marketing concept.

19. Copyright © 2007 Pearson Education Canada 3-19 Societal Classification of Products Salutary Products Desirable Products Deficient Products Pleasing Products High Long-run Benefit Low Immediate Satisfaction

20. Copyright © 2007 Pearson Education Canada 3-20 Marketing Ethics Corporate marketing ethics policies: –Broad guidelines that everyone in the organization must follow. Distributor relations. Advertising standards. Customer service. Pricing. Product development. General ethical standards.

21. Copyright © 2007 Pearson Education Canada 3-21 Marketing Ethics What principle should guide companies and marketing managers on issues of ethics and social responsibility? –Free market and legal system on the one hand. –Responsibility falls to individual companies and managers on the other.

22. Copyright © 2007 Pearson Education Canada 3-22 Ethics Programs Canadian Marketing Association has a code of ethics to help govern marketing decisions. Many companies now appoint executives to oversee ethics and ethical corporate behaviour.

23. Copyright © 2007 Pearson Education Canada 3-23 Thanks!