- January 27, 2010
- Posted by: admin
- Categories: Blog, Career Growth, Client Relations, Corporate Culture, Relationship management
Ethics in business is imperative because it acts as a guiding force for companies to meet high moral principles in delivering its services to the customers. For this reason, it is the social responsibility of every organization to comply the rules and regulations within their industry spheres. 
Marketers are responsible for what they are actually offering and what they are portraying in their marketing campaigns. Therefore they ought to be cautious in this regard and make sure that they follow the corporate values to earn long term customer loyalty. Because time and again we experience that profoundly marketed products often fall short of expectations which are initially created by their enticing marketing campaigns. But they do, on an average exaggerate their product/service’s quality.
Have your say on this – how you do perceive various marketing activities carried out by different companies for reaching their target audience. Furthermore, should there be a reasonable degree of check and balance of the promises they make to their customers.
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so far and through experience i have never seen companies enforce ethical standards whether it was for marketing their products or not. what limits such decieving practices you are referring to is laws that prohibits false representations.
marketers and marketing agencies have been and will continue to make money as long as there is a demand and a need or want for a product or service. and such institutes are not unexperienced when it comes to the LAW and what constitutes false product representation from non false representation in such big market where ideas and services are sold.
the law and rules always have gray areas nevertheless some countries don’t even have laws in regard to false presentations and in such countries marketing by word of mouth or social media marketing is the way to go for consumers to measure the reliability and presentation of products and services quality.
ethics are yet a new word in the world of business which were associated with economical crisis and the over analysis of it through the media. through my years at school and work i have never heard of it except for once at a required business ethics class which was a one credit course.
i believe the argument for how to market a product is really hard to agree on one side being correct and that is due to the fact that marketers need to show innovation and creativity on their services provided which is limited by the word “ETHICS”. so how could you market for a product without an extra spin to it, you can’t specially at certain industries specially with the increasing numbers of marketing agencies of all sizes that service a big range of industries where for profit and non for profit companies and organizations need marketing to assure thier business are achieving it’s sales figures and targeted goals and objectives. but none of these figures or targeted goals have an ethical point to it specially that most of these objectives has to do with misunderstood effectiveness and efficiency rather of the three E’s (Ethics, Effectiveness, and Efficiency).
best regards
Salima:
Excellent observation. Ethics in marketing depends on the overall corporate culture which, of course, depends on the senior management in the company. It also depends on the level of legal risk that the management team wants to incur. I have seen successful companies aspire to the highest of ethical standards, and successful companies who play it loose and right on the edge (if not over.)
My personal view is that the latter course puts the goodwill of their brands and the loyalty of their consumers at risk. If people trust a brand and then learn that the trust has been betrayed, they will never, ever buy that brand again. So to me, a marketing strategy that is “fast and loose” always puts consumer goodwill at risk — which is a very good reason for not pursuing that strategy. A company that aspires to be ethical never has to worry about thet.
Paul
I do believe that no organization would last in business if it doesn’t adopt an ethical marketing strategy. As Paul said, once the customers learn that their trust was betrayed, they will no longer buy the organization’s products/services, and word-of-mouth will probably take care of the rest.
But what constitute as the “ethical standards” is what leaves ground for some companies to play it loose.
In most cases, companies who want to play it loose will do it through omitting undesirable information (info that doesn’t help sell their product) rather than by falsely presenting them. Think about Tobacco companies where they’d have a 30 second TVC of subliminal messages of how “cool” or “classy” smoking is, only to use the last second to give a warning (in really small unreadable font) of how unhealthy smoking is.
I don’t consider companies to be devilishly smart at spinning marketing strategies. Consumers should be smart enough not to base a buying decision on impulse, or on a advertisement since no advertisement would have enough space or time to communicate all details concerning a product.
So consumers should understand that marketing campaigns are more of persuasion tools rather than informative.
And at the same time, marketers should avoid confusing consumers as to when they are presenting persuasive or informative campaigns, for example: Red Bull gives you wings! it is a great successful campaign and I’m sure that no one actually believes he/she will get wings if they drink Red Bull.
And great question!
It is all about basic structure of demand and supply.
As a marketer, he or she needs to play the fair game with his or her target group according to the company’s cultures.
Please do not follow the face of money; he or she has to think that long term of earning income.
Salima, great question, there are many angles to it. The main problem as I see it is that marketers could take advantage of the brand awareness of their product and thus feel inclined to overstate their product’s qualities. They know people will buy it because of peer pressure or social status, even if it slightly disappoints. Managing customer expecations is very treacherous terrain, but I will give you an example of what can happen when the boundary is crossed.
A large cell phone provider in the US did a big marketing campaign among its existing customer base, asking customers to choose among a variety of new, creative options they were exploring to retain their customers. After the survey results were in, they didn’t execute any of the options. Instead, they launched a new promotional campaign focused solely on price. The company claimed that it’s new pricing plans were 50% less expensive than its closest competitor. Now, everybody knew that call quality on this carrier was not the best – the marketers should have known this too, but they ignored it. When I, as a customer of this company, calculated the cost of the new plans vs. the old pricing structure, and against the competitor’s pricing, I discovered that the old plan was actually less expensive, and that the competitor appeared to offer much better value besides not being exactly twice as expensive. Naturally, at that point I decided to switch cell phone providers the moment my contract was up, even though I had been with them for more than six years.
Can you imagine, in this highly competitive environment where it costs a significant amount to attract new customers, marketers are allowed to portray the company as superior when they are not, and therefore allowed to alienate the core customer base? Of course we would like to be able to double check everything a company promises us, sometimes it’s not feasible or we just don’t want to spend the time. At those moments, it either costs us or we are lucky. But are we likely to forget a disappointing experience? I think not, even if we bury it in our unconscious.
On that last note, I am not likely to forget about New Coke. Then again, neither about the fact that Coca Cola doesn’t tell us (fortunately, my dentist does!) that its products are harmful for my oral health, and that they deplete calcium from my body. Peer pressure will not convince me to give in to Coca Cola’s ubiquitous marketing practices, no matter how attractive its products smell and taste.
I have to admit that when I saw your title, “Marketing Ethics”, the very first thing that came to mind is “Marketing Ethics => Oxymoron”.
Realistically, I know there must be some honest marketers out there, but in an industry that is so saturated with dishonesty (exageration=dishonesty), it is very difficult for the honest ones to fight against the stereotype.
i will be far happier if you can replace the word ‘ethics’ with sincerity
it is no longer possible to retain any mind-share with simple facts. customer experiences also tend to vary. media is too crowded and too expensive for a marketer to practise ethics.
so it is better if you ask me about ‘sincerity’. most marketers are sincere. they do understand that marketing is a longer term investment. but unfortunately the businessmen behind them are not. every product is a problem-solution in continuous evolution. sincerity means being at the problem and continuously working to solve it. even if there are ‘over-promises’ from time to time, as long as there is effort to keep moving, it is fine enough for consumers.
an example – intel. each new processor is better performance. but does that mean they were cheating 286 customers? or microsoft, each new version of windows is more reliable, yet crashes. but the fact that both keep at it has made them some of the most trusted and loved brands.
Here are few:
1. Do not OVER PROMISE.
2. Be HONEST, offer what you say.
3. Consumer is not a moron, she is your wife.
4. Causing harm to competitors. Excessively fierce competition and unethical marketing tactics are especially associated with saturated markets.
5. Manipulating social values. The victim in this case is society as a whole, or the environment as well. The argument is that marketing promotes consumerism and waste.
6. Targeting the vulnerable (e.g. children, the elderly).
Salima,
there should be reasonable balance, but how?
Hyperbolic statements and media roadblock (Avatar, anyone…) are opinions. How can you regulate opinions? Now, if a company lies about spec and features — there are checks and balances in place that can bust them (BBB, FCC).
People that have to exaggerate the benefits of their products have a couple of problems:
1)They have no confidence that people will buy their product the way it is to they dress it up in high-heels, a slinky black dress, a hair do and lots of make-up.
2) They feel that in order to cut through the noise, they need to shout louder than everyone else. Like a primary school argument.
Truth be told, consumer are wise to these tactics and will drown it out.
In my opinion, it is not only a matter of ethical marketing, but of ethical organizations. It is a systemic problem. Top management is responsible for deciding what to produce, finance should price it right, sales should sell it right, and operations should make it right. Marketing should market it right. If there is a break down at any point in the system, the next step needs to step it up in order to keep product going out the door.
Links:
* http://www.serfwerks.com/wordpress
Marketing can not work if it is bereft of ethics. There are lots of business practices that masqurade as Marketing when they are not. Marketing works only when it brings delight to the all the customers.As they say you can not fool all the people all the time !
If a company makes a false claim why call it bad marketing? It is just plain cheating. Marketing requires working with all cutomers and aims to build unbreakable bonds with them. Any relationship that is not based on honesty, integrity and new experiences can not last long.
The difficulty with marketing is that many professionals/professors do not understand it therefore they end up taking wrong decisions in the name of marketing. Most MBA students are aware that when it comes to opting for a specialisation in the third semester the toppers generally opt for Fiannce stream leaving the Marketing for the second rung students. The recent bankruptcy in the USA could also be linked to poor marketing of the financial services by professionals who had no grounding in basic marketing principles. Had those bank had trained marketing professionals at the helm the crash could have been entirely avoided.
Marketing is business and therefore ethics have to be an integral part of long term success.
Hi Salima
Another interesting topic from you.
As long as “fine print” is permitted – let us not talk about ethics, we could be pulled up for slander against a product in discussion, because they have very clearly mentioned (in fine print) that the price is applicable only for a certain period, on the fixed time, on the amount purchased etc.
You could scream from the top of the roof ” We give you the world for free” but in a feeble voice which can’t be heard anyone mention “conditions apply”, and add a list of conditions which no can fulfill. You did your job nicely, and the guy who could not hear the ‘conditions apply’ is the one who gets blamed.
I am asked to read the details, before I buy, look for the manufacture date, the expiry date, the contents, if possible weigh and check if it matches the weight mentioned on the box. Has the ethics gone down so low, that we pick up products of multinationals and read these ?
Even if you do get hold of something – they bet on the fact that the customer would give up chasing them.
They use voice to broadcast the products, and silence to answer their customer.
This would not be the right platform for me to give instances, where I have personally handled the corporates, to fight for misleading or faulty products – some I have succeeded, and some I simply had to give up due to lack of time to follow the matter ( which is what all these big companies bet on)
Healthy competitions are OK, taking away your customer is also OK. If you are not prepared, then the fault is yours. If you don’t have the capacity to retain your customer, problem is yours, why blame the competition for taking away your customer.
But if this has been done in an unethical way – that would be wrong, stealing your recipe, stealing your staff, or R&D, are the wrong way, but you still can’t fight it out legally, until and unless you have taken some serious measures to prevent these from happening.
Hitting the lowest point is the direct comparison between two products and then a series of advertisements, legal issues, and blah blah that follows.
Who sets the standards ? We, Manufacturers, Marketers ? Media ?
Zia
I agree with you; I fear the pressures of competition force each player “farther out.”
Links:
* http://www.WallaceJackson.com
…So the advertisment leads the buyer to consider a supercharger in an automobile makes it a green machine. So they buy it convinced that their decision was righteous.
Later, the buyer finds their natural heavy footed romps through traffic gives a thrill-a-minute and satisifies their adolecent kicks, but the high torque and wear, the cost of fuel; the speeding tickets, and lower resale convinces them that buying a green automobile can be expensive.
Then shamefaced they find out while reading about their vehicle that the sales technique was farcial at best. Do you think they will admit to anyone they were stupid? Therefore, there will be no impending lawsuits.
So truth-in-advertising “ethics” in this case were in short supply. The crooked sales technique may only work once with some customers. Unless of course, the unethical sales department operates on the ignorance, (let-the-buyer-beware) stupidity and forgetfulness margin.
I may not be qualified to answer marketing, but I just want throw my feelings in ……
We convinced a prospect , educated and converted as a client. we manage them successfully for the last 2 years. Then, third year, two competitors pitch in to get the order. Is it ethical? I say, when the client is happy why try to break that relationship? Anyway, we managed to retain the client for the third consecutinve year. When I asked one competitor’s ,marketing person point blank, he said, ‘it is fair in business’
Is it fair to lure a client who was groomed by another ? I strongly believe that the market is big and every one can have their share. If the client is not happy , they any one can pitch in. Am I wrong? probably yes, as business seem to done with mindm not heart!
Ramesh
The Human search Engine
But often the marketers are contract ad companies with no access the the research and development team or any of the science…thus accountability to ethical standards is diluted and we end up exposed to various health-related claims or labels that most would agree are misleading (what does it take to be low sodium or organic? is a high sugar cereal heart-healthy?). Serious ethical breaches by business seem to be the precipitating factor leading to government regulations (at least in the U.S.).