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International Islamic University


Islamabad

Subject: Marketing Theory and Practice


Submitted by: Muhammad Khalil Hussain
Submitted to: Sir. Syed Adnan Shabir
MBA 19(B)
Date: 24-03-2008
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Social Responsibility in Marketing


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Social responsibility means that organizations are the part of a larger society and
are accountable to that society for their actions. Like Ethics, agreement on the
nature and scope of social responsibility is often difficult to come by, given the
diversity of values present in different societal, business, and organizational
cultures.
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Social responsibility demands that marketers accept an obligation to give equal
weight to profit, consumer satisfaction, and social well being in evaluating their
firm’s performance. They must recognize the importance of relatively qualitative
consumer and social benefits as well as the quantitative measures of sale, revenue,
and profit by which firms have traditionally measured marketing performance.
Social responsibility Marketing philosophies, policies, procedures and actions
that have the enhancement of society’s welfare as a primary objective.
Social responsibility allows for easier measurement than marketing ethics.
Government legislation can mandate socially responsible actions. Consumer
activism can also promote Social responsibility by business. Actions alone
determine social responsibility and firm can behave responsibly, even under
coercion. Government requirements may force firms to take socially responsible
actions in matter of environmental policy, deceptive product claims, and other
areas. Also, consumer, through their power to repeat or withhold purchases, may
force marketers to provide honest and relevant information and fair prices.
Ethically responsible behavior, on the other hand, requires more than appropriate
actions; ethical intentions must also motivate those actions.
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The Societal Marketing Concept:
Marketing can be described as a "social process by which individuals and groups
obtain what they need and want through creating and exchanging products and
value with others".
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Concepts of social responsibility:
There are three concepts of social responsibility.
(1) Profit responsibility
(2) Stake responsibility
(3) Societal responsibility
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Profit responsibility:
Profit responsibility holds that companies have a
simple duty to maximize profits for their owner and stockholder.
Nobel Laureate Milton Friedman, who said, “there is one and only one social
responsibility of business to use its resources and engage in activities designed
to increase its profits so long as it stays within the rules in the game, which is
to stay, engage in open and free competition without deception or fraud.”
Stakeholder responsibility:
Stakeholder responsibility focuses on the
obligations an organization has to those who can effect achievement of its
objectives. These constituencies include customers, employees, suppliers and
distributors.

Societal Responsibility:
Societal responsibility refers to obligations that
organizations have to the (1) preservation of the ecological and (2) general
public. Concerns about the environment and public welfare are presented by
interest and advocacy groups such as Greenpeace, an international
environmental organization.
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Corporate Social Responsibility (CSR) means firm’s obligation to protect and
improve welfare of the society and its organization, now as well as in future,
through its various business and social actions, and ensures that it generates
equitable and sustainable benefits for the various stakeholders. As such CSR
can serve as an effective marketing tool to compete and maintain competitive
advantage in the present fast changing, hyper competitive environment.
Generally, CSR is considered as firm’s obligation to protect and improve
welfare of the society and its organization, now as well as in future, through
various business and social actions and ensures that it generates equitable and
sustainable benefits on the various stakeholders.
Chakaraborty have viewed CSR as a mean of achieving commercial success in
ways that honors ethical values, respect people, communities and natural
environment, and encompasses all those actions of the organizations which
affect the society and its well being. The main fundamental embedded in CSR,
according to them, is that no business corporate can act as isolated from
broader issues of society. CSR has been considered as one of the antecedents
for economic performance and also as a measure of proactive social responsive
view.
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Social responsibilities in marketing have recently come under sharp criticism
for undermining the democratic process, since "marketers do not have the right
to decide what is in the public interest".
This article investigates whether "the social responsibility of marketing is to forget
about social responsibility", and in so doing addresses the question of whether the
societal marketing concept can, is and should be included into the traditional
marketing concept. Thus with the ultimate goal of evaluating businesses and
specifically marketing's response to the increasing societal demands being placed on
it.
The objectives of this article are:
(1) To investigate whether societal marketing is regarded as a lawful and necessary
aspect of marketing in the tobacco and liquor(juice) industries in South Africa and the
extent to which it is in fact practiced by them, and
(2) To explore the societal marketing concept as a possible response by business to
the increasing social demands with which it is being confronted. This research
focuses on two industries in particular the liquor and tobacco industries which were
chosen because they have been catapulted into the forefront of the societal marketing
ground as a result of the widespread agreement that the consumption of their products
can cause serious damage to personal and social welfare. There were several
similarities in the response and situations of the two industries. Politics play an
extremely important role in both industries, determining to a large extent not only
government action, but also industry attitudes. Since both industries are economically
highly concentrated, the few giant companies which dominate the market in each case
have considerable economic and political muscle. The power of each industry is
further well-established by government reliance on the huge contributions by each.
Both industries are very well aware of their economic and political influence, and do
not hesitate to use it to protect their interests. These factors have enabled both
industries to be less sensitive to public opinion than their overseas counterparts, and
explain their relative protection from regulation in the social sphere, as well as the
slow response of government to increasing public discontent. Thus any actions by or
against the industries must take into account the political complexities of the situation
and the political and economic ramifications of any changes to the status. Since it is
not the purpose here to discuss the merits of the arguments raised by the tobacco
industry, but rather the approach it has taken, it must be pointed out that the tobacco
companies' denial of any conflict between their marketing goals and the goals of
society in the face of rising evidence to the different reveals a disturbing aspect of the
tobacco industry's approach. It is following a strategy of survival at all costs whether
these are in the form of its own moral integrity or in the form of societal well-being.
For both of these must be sacrificed if the industry puts forward viewpoints or
arguments which it knows to be specious (even if not scientifically provable as such)
and makes statements without any real conviction as to their truth.
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The social responsibility and ethics of businessmen have been much studied.
Although it has been criticized for lacking a theoretical basis, research on
social responsibility and ethics in the area of marketing has become a popular
area of study in the last thirty years. The majority of marketing scholars in
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Korea might have opted to look at marketing practices from the point of view
of the seller rather than from that of the buyer. On the bases of limited research
findings and loose definitions of social responsibility and ethics in marketing
practices, this article discusses the reasonable causes of the existing
incongruence between the superficial awareness (or principles) and the original
purpose (or actual judgment) of Korean managers.
From the survey conducted for this study in 1996, it was found that Korean
managers have a rather positive awareness of social responsibility and ethics.
The survey was conducted for the participants of top management development
programs of five universities in Seoul and one in Taejon, Korea.
The survey showed that the majority of the respondents either agreed or
strongly agreed that they would bear responsibility, except on the question of
hiring a manager from competitors. Little difference in the distribution was
found among different groups of respondents, such as owners versus
professional managers or managers of small versus large firms.
Various reasonable explanations are presented in this paper of the
incongruence between the apparent awareness and the actual practices of
Korean marketing managers.
First, there is incongruence between awareness and practices on the part of
Korean marketing managers with respect to fulfilling social responsibility.
Second, one reasonable explanation for the existing incongruence may be
found in the characteristics of the Korean cultural tradition.
Third, cultural doctrines, such as kindness and mercifulness, have often served
rather positively, but some other traditional heritage, such as hierarchical
dictatorship, has had a negative effect on social responsibility in marketing.
Fourth, for Korean managers, particularly those in marketing, it is vital to be
aware of the obligations rather than rights and authorities.

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It could be argued that in the modern era business has begun to be more
accountable to a greater number of constituencies than ever before. The
thinking of the stakeholder has become to be drawn much wider than before.
Social responsibility, once decried as being irrelevant in the early 1950s and
60s is now at the forefront of business relationships. Of course there are firms
that take this concept lightly, there are others who adopt such notions, but are
seen to be lacking in the finer points when under examination. It is often
argued that business will always be responsible only to itself.

1. It is important to perform in a manner consistent with the generous and


charitable expectations of society.

2. It is important to assist the fine and performing arts.


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3. It is important that managers and employees participate in voluntary and


charitable activities within their local communities.

4. It is important to provide assistance to private and public educational


institutions.

5. It is important to assist voluntarily those projects that enhance a


community’s “quality of life."

References:

1. Marketing 6th Edition


By
BERKOWITZ, KERIN, HARTLEY, RUDELIUS

2. Contemporary Marketing.

3. European Journal of Marketing


“Perceptions of the Societal Marketing Concept”
by
Russell Abratt
Department of Business Economics,
University of Witwatersrand, Fohannesburg. South Africa, and
Diane Sacks
Harvard Law School, Harvard University, USA

4. Marketing 6th Edition


by
BERKOWITZ, KERIN, HARTLEY, RUDELIUS

5. Journal of Services Research, Volume 6, Number 1 (April 2006 - September


2006)
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“IMPLICATIONS OF CORPORATE SOCIAL RESPONSIBILITY ON


MARKETING PERFORMANCE”
Hardeep Chahal R.D. Sharma

6. European Journal of Marketing


“Perceptions of the Societal Marketing Concept”
by
Russell Abratt
Department of Business Economics,
University of Witwatersrand, Fohannesburg. South Africa, and
Diane Sacks
Harvard Law School, Harvard University, USA

7. Awareness of Social Responsibility by Korean Managers in Marketing


Practices.
By: Chung Whang, International Studies of Management & Organization,
00208825, Winter98/99, Vol. 28, Issue 4

8. <URL:http://www.oldredlion.here2stay.org.uk>