[Answered] Discuss the ethical issues involved in marketing of a product or service. How can these issues be resolved?

Demand of the question Introduction. Contextual introduction. Body. Discuss various ethical issues involved in marketing and methods to resolve the same. Conclusion. Way forward.

Marketing refers to activities of a company associated with buying and selling a product or service. Marketing through advertising, selling and delivery of products to potential customers, is vital for the success of any business. Since it has the potential to influence attitudes, behaviours and priorities, ethical considerations are part and parcel of marketing.

Ethical issues involved in marketing:

  1. Privacy: Organisations today collect, store and process information relating to customers to be used for targeted advertising. In such cases the concerns for privacy require an effort for informing the customers and acquiring their consent.
  2. Stereotyping: Marketing campaigns based on generalized studies or common perceptions about behaviours and values of certain demographic groups raise important ethical issues. For example, often women are matched up with household products such as cleaning supplies and are shown as doing domestic work.
  3. Objectivity: The concern for objectivity is a vital issue in marketing. The lack of objective research on part of the market researcher may legitimize profiting from poverty, cultural stereotypes and racial tensions.
  4. Vulnerable targeting: Targeting an audience such as children involves ethical consideration. Children have always been an important marketing target for certain kinds of products.
  5. Unethical market exclusion: The absence of minority groups in marketing in a multi-ethnic society can create image and identity problems among those that are excluded. For instance the adverse industry attitudes to the homosexual, transgender and ethnic minority.
  6. Unintended advertising channels: Direct marketing is the most controversial of advertising channels, particularly when approaches are unsolicited. TV commercials and e-mail are common examples. Electronic spam and telemarketing push the borders of ethics and legality more strongly.
  7. Misleading advertising: Many advertising are misleading. For example, misleading the public by showing turning a black face into white.
  8. Negative advertising techniques: The advertiser highlights the disadvantages of competitor products rather than the advantages of their own.
  9. Anti-competitive Practices: For instance, Predatory pricing which is practice of selling a product or service at a very low price, intending to drive competitors out of the market, or create barriers to entry for potential new competitors.
  10. Use of brand ambassadors: Ambassadors endorsing products they don’t use or whose authenticity they don’t cross check, making profits out of public’s reverence of a person, high cost of celebrity eventually extracted from public, puts newer and smaller brands at a disadvantage hurting fair competition.

Resolving Ethical Issues in Marketing:

  1. Regulation: More than external regulation, marketing needs internal controls and self-regulation. The organisations are expected to develop principles of ethics to guide the marketing process. The establishment bodies such as Advertising Standards Council of India (ASCI) can be seen as a step in this direction.
  2. Consumer protection: Various Consumer laws protects consumers and competition law protects competitors from unethical practices. Apart from these regulators like CCI, TRAI, IRDA etc. may also be approached for grievance redressal.
  3. Customer participation: Generally a customer is regarded as only a recipient of products or services. However, if the marketer involves the customer and does things in interaction with the customer it may work to reduce two potential ethical dilemmas of consumer autonomy vs. marketing effectiveness and consumer participation.
  4. Taking responsibility: An organization should take the responsibility of its actions. The responsibility also extends to the employees and other organizations that the firm deals with like suppliers or dealer agencies. The organization should make sure that any marketing decisions and actions meet the customers’ needs and actions should also cater to the broader needs of the society.
  5. Balance the Interests: Marketing has a number of objectives ranging from providing information about the product/service, stimulating the demand and boosting the sale etc. The organization should focus on the long-term benefits in terms of better branding and customer loyalty while making decisions on ethical issues.
  6. Corporate Social Responsibility: Customers are getting increasingly sensitive about the production processes and the level of social responsibility of an organization. Customers tend to prefer the products/services from a company which is relatively more socially responsible. Hence, it is a benefit for the organization to be ethically correct for its customers.

Marketing ethics, regardless of the product offered or the market targeted, sets the guidelines for which good marketing is practiced. To market ethically and effectively one should be reminded that all marketing decisions and efforts are necessary to meet and suit the needs of customers, suppliers, and business partners. A company must have ethical marketing policies to guide their pricing, advertising, research, and competitive strategies.

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