Ethics and Social Responsibility in Marketing Strategy and Marketing Implementation and Control
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Ethics and Social Responsibility in Marketing Strategy
Introduction
Different business jurisdictions have established formal outfits to superintend the marketing strategies of firms under them to protect consumers, shareholders, and the environment against unethical and insensitive social responsibility practices. It is against such a background that the Federal Trade Commission (FTC) was formed. Federal Trade Commission (FTC) was established to, among other things, prevent practices that are anti-competition or unfair to consumers, enhance informed consumer choice and public understanding of the competitive process and achieve all this without unnecessarily burdening the business activity. FTC has three arms, namely: Consumer Protection, Competition, and Economics (FTC, n.d). However, this work seeks to review the last two months of press releases (blogs, news, reports, etc.) from the FTC page, identifying major marketing ethical issues around the theme of customer protection.
Background
Selling and persuasion have become increasingly important tools in the exchange of goods and services. Hence, for quite some time across the business arena, concern has been expressed about the ethical considerations of business operations and practices involved in such a process. In this regard, there may be both intended and unintended unethical practices within a marketing strategy. These may include encouraging unsafe behavior, improper evaluation of products, unscrupulous credit practices, deceptive stereotyping around products and use, unnecessary price discrimination, gender insensitivity, and inaccurate information during the advertising. Developing an effective marketing strategy, therefore, requires serious consideration of ethics and social responsibility. Failure to understand and appreciate such factors may result in negative effects against consumers, shareholders, the community, and the environment. An effective code for ethics that informs operations within the marketing strategy provides a firm with a strong foundation for social responsibility.
Major Marketing Ethical Issues –FTC Customer Protection Bureau
Marketing ethics generally is an area of ethics that deals with the operation, practice, and regulation of marketing. An effective, ethical marketing strategy needs to operate on the ideals of justice and fairness, equality, freedom, and truth. The FTC Customer Protection Bureau more specifically exists to stop unfair, deceptive and fraudulent business practices by gathering complaints and conducting investigations, suing people and companies that break the law, developing rules and regulations that ensure sustainable marketplace, educating consumers and businesses about their rights and responsibilities in the marketplace (FTC, n.d). The following are some of the major marketing ethical issues that arose from the FTC Customer Protection Bureau, as captured on the FTC’s website:
Fairness
This comes through practices such as dishonest advertising or promotions, where a firm manipulates or induces consumers to use products or goods that they do not need or using false information to get the consumers to buy a good or service. There are at least two instances of this captured on the FTC webpage. One is a case where a firm allegedly deceived consumers with mailers supposedly directing them on how to obtain federal COVID-19 stimulus benefits but instead lured them to a used car sale. The other one is about using the desperate COVID-19 pandemic situation to lure people into commercial schemes.
Confidentiality
This is concerned about attempts to use or obtain information that is and maybe classified, secret, or competitive. It appears there is an emergence of privacy conman ship sweeping across the nation. The phenomenon of business firms infringing on children’s privacy and general consumer privacy is gaining ground. Hence, FTC is organizing July 21st Privacycon awareness campaigns to protect consumers against confidentiality infringements during purchases (FTC, n.d). There is also an upcoming event on information security whose import measures to guarantee customer privacy.
Lies and Credit Misreporting
This is a deliberate attempt by a business to report or enter credit information to exploit consumer inaccurately. The Senate’s Appropriations Committee report that accompanied Financial Services and General Government Appropriation Bill of 2020 addresses itself to the correction of inaccurate and incomplete credit information and handling of attendant credit disputes (FTC, n.d). Practical ethical considerations in a marketing strategy ensure that the processes of exchange of goods and services proceed in an environment the consumer is not exploited, and fairness is enjoyed not only by consumers but also by every player in the business environment.
Theodore Levitt’s Marketing Myopia
Marketing myopia is where business gets too tied to a given industry or product rather than seeing itself as existing to meet customer needs. The business focuses on selling products instead of seeing the bigger picture of the service that the customer needs (Sanchez, 2019). In the end, a slight or major change in the market scenario throws such a business, of course, when the product in question ceases to make meaning to the customer as new technologies emerge. Theodore argues that rather businesses viewing themselves purely as working in growth industries where the marketing and trade focus is selling, they should continually adapt themselves to meet customer needs better or risk shutting down when the market scenario changes. Levitt, 2008 stated that making money is not the focus of marketing, otherwise on getting more customers. Selling keeps track of quantity, while marketing gathers customer needs and their satisfaction. Myopia is an ocular disease consists of having a short vision, not being able to correctly focus on distant objects, which in marketing is based on focusing on the characteristics of the products and not on the needs of the consumer (Lucas & Goh, 2009). This translates into: Defining your business’s nature in the wrong way is the result of short-sighted marketing.
Marketing myopia sets in when a firm abandons its long-term marketing goals over the short-term one. Many businesses have suffered the effect of marketing myopia (Sanchez, 2019). Take, for instance, in the photography industry. The Kodak Company that used to produce films used in film-based cameras lost its share market to Sony at the advent of digital technology (Lucas & Goh, 2009). While Sony moved quickly and adapted to the emerging trends in digital technology with respect to photography, Kodak never saw the disruption coming and did not plan for it. As a result of Kodak market share tremendously declined
References
FTC, (n.d). Bureau of consumer protection. Retrieved from https://www.ftc.gov/about-ftc/bureaus-offices/bureau-consumer-protection
Lucas, Jr, H. C., & Goh, J. M. (2009). Disruptive technology: How Kodak missed the digital photography revolution. The Journal of Strategic Information Systems, 18(1), 46-55.
Sanchez, C. (2019). An introduction to Theodore Levitt’s Marketing Myopia. Retrieved from https://www.youtube.com/watch?v=63AR9D54HKM