Guilherme D.

Pires
John Stanton

Ethnic Marketing Ethics

ABSTRACT. Culture plays an important role in

defining ethics standards because dissimilar cultures
socialize their people differently, according to what
is acceptable behaviour. The potential significance of
ethnic groups for marketing justifies inquiry into
the moral judgments, standards, and rules of conduct
exercised in marketing decisions and situations arising
from decisions whether or not to focus on individual
ethnic groups within an economy. Identifying and
targeting ethnic groups for marketing purposes are
tasks fraught with many ethical difficulties. In a
multicultural society consisting of a dominant group
and many diverse, minority groups defined by
ethnicity, these problems can be expected to increase
substantially. Consequently, marketers may include
minority ethnic consumers in their mainstream
marketing programs. In itself, this has ethical consequences. Alternatively, if marketers seek to target
individual minority ethnic groups within the same
economy a further set of ethical consequences needs
to be considered. This paper reviews the concepts of
ethnicity and ethnic groups and their relevance for
marketing strategy within an economy where there
is a dominant group and also significant minority
ethnic groups. The ethical consequences for minority
communities arising from the use of non-ethnic,
mainstream marketing programs are examined. An
Guilherme Pires is a lecturer in Marketing and Management
at the University of Newcastle, Australia. Main research
interests are marketing and management under conditions of cultural diversity, services marketing and small
and medium enterprise.
John Stanton is a Senior Lecturer in Marketing and
Management at the University of Newcastle, Australia.
His research interests include the marketing and management of economic issues arising from cultural diversity in advanced economies, marketing in small
enterprises, and the interface and overlap of marketing
with other disciplines.

alternative approach, ethnic marketing, is also

examined and its ethical consequences in terms of
other groups within the one country appraised. The
ethical dilemma and tradeoffs facing marketers
within advanced, culturally diverse countries are then
considered.
KEY WORDS: ethnic marketing, ethnic minority
consumers, minority ethnic groups, targeting,
unintended ethical consequences

Introduction
Ethics has been identified as a category of classical philosophy, together with metaphysics (what
is the first principle of things?), epistemology
(what is true?), aesthetics (what is beautiful?), and
rhetoric (how to persuade or influence others?).
Ethics corresponds to what is good? (Seeley
and Wasilewski, 1996). Applied to consumer
behaviour, what is good? may be expressed as
what is acceptable behaviour? This grounds
Segal and Giacobbes (1995) argument that
culture may play an important role in defining
ethics standards because different countries with
dissimilar cultures socialize their people differently, according to what is acceptable behaviour.
For example, Western ethics may involve an
epistemological quest for objective reality, the
truth. But, if one wishes to understand Japanese
ethics, the underpinnings have to be found in
aesthetics, conveyed by social beauty or social
harmony (Seeley and Wasilewski, 1996, p. 165).
Drawing from a review of the literature, Segal
and Giacobbe (1995) found sufficient evidence
to argue that ethical diversity is linked to cultural
diversity.

Journal of Business Ethics 36: 111118, 2002.

2002 Kluwer Academic Publishers. Printed in the Netherlands.

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Guilherme D. Pires and John Stanton

Cultural diversity is used in the above

argument mostly in an international context.
However, growing awareness of the increasing
importance and marketing relevance of ethnic
groups within multicultural societies justifies
inquiry into the nature and grounds of moral
judgments, standards, and rules of conduct
relating to marketing decisions and marketing
situations (Vitell et al., 1986); in this context,
marketing ethics. Accordingly, this paper explores
ethics issues that need to be considered in
deciding whether to use ethnic marketing, differentiated marketing strategies towards individual ethnic groups.

From mass-marketing to ethnic marketing

The study of ethics arguably involves two intertwined challenges. One is to unambiguously
define what ethics is a matter outside the reach
of this paper. The other is to achieve an effective conceptual separation from two other
elements: social responsibility (what is good for
society in general, present and future) and simply
poor business practice (as contrasted with unethical behaviour). In the realm of marketing these
challenges are deepened by the need of a firm as
a whole to simultaneously satisfy individual
customers needs as well as societal needs, subject
to the firms objectives. This marketing orientation is encapsulated in the marketing concept
and bears clear similarities to the argument that,
while making a profit is necessary to stay in
business, from an ethical perspective firms should
not distort their primary function as providers
of a service to their customers (Buchholz and
Rosenthal, 2000). Hence a firm needs to define
a level of what is good that balances its own
goals, customers needs, and those of society in
general.
The international environment is recognised
as attracting more difficulties for marketers
(Kotler et al., 1998, p. 833) because their ethics
parameters may not match the notion of good
in the foreign country where they wish to
operate. This is a problem because it may compromise successful international market penetration (Skubik, 1993), that is, a firms ability to

compete in the international market. To the

extent that international operations are part of
an overall competitive strategy (either because
of a firms need to have a presence where its
main customers operate, or because the firm
must/needs to follow its competitors) this also
can influence a firms ultimate survival in its
domestic market. Ethical concerns are thus
clearly important.
Interestingly, the challenges associated with the
international environment appear to be gaining
in importance because of the current marketing
push towards a process of globalisation of supply,
particularly when this does not correspond to
a similarly globalised demand. Globalisation
of demand implies sameness across cultures,
however, what appears to be happening in reality
is a strengthening of the cultural differentiation
across countries through ethnicity. Ethnicity was
expected to disappear as a social force during the
twentieth century, effectively ending its social
and political importance, and consequently, its
economic relevance (Cornell and Hartmann,
1998; Hutchinson and Smith, 1996; Bentley,
1981). Instead, the global process by which
industrialisation, urbanisation and mass communications has been transforming society has reinvigorated identity construction and ethnicity
(Cornell and Hartmann, 1998; Castles et al.,
1992). While this argument may require further
investigation in the largely unclear global
diaspora, its adequacy may be mirrored, and supported, in the continuing presence of minority
ethnic groups within the sovereign national
boundary of advanced economies such as
Australia, Canada and the U.S.A. These countries are often alluded to as multicultural or
pluralistic societies, terms that recognize their
cultural diversity.
Minority ethnic groups are understood as
memberships of ethnic minority consumers, that
is, individuals that share an ethnicity distinct from
that of the mainstream population. Minority
status may result from the emigration and settlement of natives of one country (the home
country or country of birth or origin) in another
(the host country, with its own native population, the majority or mainstream). Minority
status also may apply to particular groups of the

Ethnic Marketing Ethics

host country itself, that is, the home and host
countries are one and the same.
Awareness of the potential importance of
minority ethnic groups for marketing may be
traced back at least to Andreasen (1975), albeit
in a narrow context of aetiology and consumption barriers. This importance arises because
culture and ethnicity are relevant causal constructs for both seller-buyer and consumer
behaviour (Hui et al., 1992), determining that
each minority ethnic group is potentially unique.
This supports the need for cultural differences
to be taken into account when marketing across
countries, as well as recognizing the need
for marketing programs that are tailored to individual minority ethnic groups in culturally
diverse societies. Arguably, the latter is the
realm of multicultural marketing, a term often
used interchangeably with ethnic marketing
(Nwanko et al., 1998, p. 48), adopted in this
paper. Cui (1998) describes ethnic marketing as
to treat ethnic consumers as distinctive markets
separate from the macro market and to reach
them using differentiated marketing mix strategies (p. 87) or, more succinctly, differentiated
marketing towards an ethnic group (p. 88).
Interest in the ethics issues associated with ethnic
marketing is, therefore, justified.
One possible approach to ethnic marketing
ethics within one country, understood as ethics
applied to marketing practice targeting minority
ethnic groups, is to apply the same procedures
that firms use to deal with ethics problems in
the international context (Kotler et al., 1998).
However, this may prove inadequate because
ethnic marketing faces at least four unique environmental problems. These, together with a
possible lack of understanding of ethics issues
associated with ethnic segmentation and marketing, contribute to the mystification of ethnic
marketing, described as a minefield by Blanton
(1993). The four problems are, respectively:
1. the boundaries of the different minority
ethnic groups may be fuzzy, even if indicators as simplistic as country of birth or
language are used to identify the respective
populations;
2. the notion of what is good may change

113

from minority ethnic group to minority

ethnic group, as it may change from one
country to another (Kotler et al., 1998);
3. what is good for one minority ethnic
group does not invalidate what is good
for any other minority ethnic group (Pruzan
and Thyssen, 1990);
4. the application of marketing strategies to
accommodate a variety of competing ethics
behaviours may ensue while ethnic minority
consumers from the different minority ethnic
groups are potentially in each others presence.
This has the potential to alienate all parties
if an adequate synergy between minority
ethnic groups and marketing strategies
cannot be reached (Cui, 1998).
The problem of fuzzy boundaries may be
solved with more or less difficulty through
market research; however, the delineation of
ethical procedures applicable across minority
ethnic groups poses greater challenges. A potential solution involves the elaboration of codes of
ethics as a means to facilitate ethical behaviour.
However, not only written codes and ethics
programs do not assure ethical behaviour (Kotler
et al., 1998), but any attempt to globalise a
code of ethics might need to be examined with
suspicion. It is much like devising a scale of
goodness, or ethical intensity, where fair means
less than ethical but acceptable. One possible
way to get around this problem, may be to apply
a contingent approach, keeping the code of ethics
general enough, dependent on the ethical evaluation of the participants stakeholders, buyers
and sellers to deal with inter-ethnic situations.
However, this relies on judgment and, arguably,
it is this reliance that justifies the need for the
code of ethics in the first place.
The link between decision-making about
ethics and human involvement (and, therefore,
judgment) is apparent in the literature. Ethical
decision-making is seen as part of an individuals
character rather than an act to be performed by
an individual (Hartman and Beck-Dudley, 1995).
This is particularly important because ethical
decision-making often is situation-specific,
involving an ethical dilemma that needs to be
evaluated by its situational content ( Jakob et al.,

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Guilherme D. Pires and John Stanton

1998). Hence ethical-decision making is influenced by culture and ethnicity, both important
elements to consider in situations involving different countries, as well as in a multi-ethnic
country environment (Sarwono and Armstrong,
1998).
Establishing ethical dimensions for ethnic marketing, whether embodied in a code of ethics or
not, is a challenging task. Which strategy is better
suited to accomplish this task, however, is a
matter umbilically tied to developing knowledge
about ethnic minority consumers, their relationship to their ethnic group of affiliation, and
ethnic marketing itself. Nevertheless, coupled
with reflection, the specialized literature identifies related ethics issues, providing some guidance
on what those dimensions might be.

Ethics issues in ethnic marketing

Ethnic minority consumers, particularly in their
first time of settlement in a new country, may
be inexperienced in relation to what is available,
where, and for how much, as well as being
unaware of market dos and donts. This justifies
their possible reliance on referral or recommendation by others they trust, eventually their
minority ethnic group of affiliation, particularly
when communication difficulties limit the
number and range of accessible secondary sources
(Pires and Stanton, 2000). Within such a
scenario, ethnic minority consumers may be perceived as disadvantaged because they are arguably
more vulnerable to be taken advantage of
through deceptive practices (Kotler et al., 1998;
Moore-Shay et al., 1996). Where ethnic minority
consumers exhibit visible ethnic elements or
features, consumer disadvantage may ensue
from racial discrimination (Grier et al., 1996).
Deception and discrimination are clearly important ethics issues involving ethnic minority
consumers, if by no means exclusive to ethnic
marketing. There are, however, other less visible
ethics issues that need to be taken into account.
Cui (1998) sets out to analyse the ethics issues
associated with ethnic segmentation and targeted
marketing, a purpose that is related to the objective pursued in this paper. The study identifies

five areas of eventual ethnic segmentation and

targeted marketing failure, noting the possible
incidence of associated ethical failure: inadvertent stereotypes, biology and genetics, nature of
the product, redlining and ethnocentric bias.
Along the argument earlier advanced by
Stevenson (1991), inadvertent stereotypes refer to
situations where the recognition of a minority
ethnic groups importance leads to increased participation by ethnic minority consumers in
advertising to other ethnic minority consumers
presumably a good thing although the actual
messages are stereotypical and do not reflect the
diversity of the minority ethnic group. Biology
and Genetics refer to the use of superficial or
exaggerated physical or biological attributes of
minority ethnic group that may suggest that
ethnic minority consumers are inferior. The
nature of the product refers to the target marketing of ethnic markets with negative, inferior
or harmful products. It is not clear why the
ethical failure element is particularly applicable
to minority ethnic groups and not to every other
consumer. Redlining is the selection or exclusion of markets based on racial lines. Finally,
perhaps more important of all in the present
context, ethnocentric bias questions whether fundamental principles of marketing based on
research of the majority population, can be
generalised to minority ethnic groups. Here
the ethical question both focuses on the consequences from non-differentiation of ethnic
minority groups from the mainstream population,
and on the consequences from targeting minority
ethnic groups with mainstream marketing
programs. Reflection on this perspective suggests
a number of important potential implications,
both for ethics and for social responsibility, not
always easy to separate. These are presented in
Table I.
Some of the listed possible ethical consequences may result from deliberate actions (such
as the intended provision of inadequate, insufficient, misdirected or misinterpretable information leading to biased decision-making by ethnic
minority consumers), while others may not
be deliberate. For example, mass-designed ecommerce developments may be particularly
challenging for ethnic minority consumers, as in

Ethnic Marketing Ethics

115

TABLE I
Possible ethical consequences from target marketing minority ethnic groups with mainstream marketing programs
Failure to provide for basic needs. Certain minority ethnic groups may do without needed goods and services,
causing harm to their physical or psychological well-being. Similar to Kotler et al.s (1998) principle of meeting
basic needs.
Misallocation of resources, since it does not seek to satisfy real needs and wants. Similar to Kotler et al.s
(1998) principle of economic efficiency.
Discrimination against minority ethnic groups by presuming inadequate substantiality. This may involve the
deliberate distortion of a firms primary function of providing a service (Buchholz and Rosenthal, 2000), as
well as the potential influence of poor business practices.
Deliberate overestimation of the targeted mainstream population by including minority consumers with
different needs and wants. This may lead to over-marketing resulting in increased costs for consumers in
general (Fisher et al., 1999).
Perpetuation of minority status by promoting continued invisibility of minority ethnic groups.
Discrimination against minority ethnic groups by providing inadequate, insufficient, misdirected, misinterpretable information Similar to Kotler et al.s (1998) principle of consumer education and information.
Small print in contracts and use of jargon may be unfair given the market inexperience of ethnic minority
consumers.
Social responsibility issues such as the failure to translate public interest information in the languages of the
minority ethnic groups (e.g. non-smoking campaigns, use of roundabouts).

the case of online pharmaceutical services. These

arguably fulfill some important social functions
(such as convenience and accessibility), although
the application in cyberspace of safeguards
established for the sale of drugs in traditional
pharmacies raises ethical questions. This is
where inadequate, insufficient, misdirected or
misinterpretable information may challenge
ethnic minority consumers. For example, the
treatment of symptoms through online drugs may
keep patients from having the underlying causes
properly diagnosed, with potentially serious or
even fatal consequences Bento (2000, p. 433).
Clearly, some of the potential ethical consequences listed in Table I may, on closer situational analysis, result mostly from poor business
practices, in which case the resulting ethics/social
responsibility issue is still present, but not deliberate. Similarly, the targeting of minority ethnic
groups may involve unethical deliberate actions,
as well as actions intrinsically unethical. Table II
lists possible consequences from unethical target
marketing of minority ethnic groups.
Ultimately, the literature provides some arguments relative to natural or artificially induced
behaviours that, to some extent, may reduce
consumer vulnerability and exposure to uneth-

ical behaviour. Consumer vulnerability can be

reduced, particularly when important purchases
are involved, by consumers seeking information
from a variety of sources (Kotler et al., 1998).
This, however, may not always apply to ethnic
minority consumers with communication difficulties. As argued earlier, these difficulties may
reduce accessibility to secondary sources and
may lead to intended or unintended misuse of
services, as in the case of online pharmacies.
In terms of consumer exposure to unethical
behaviour, the counteracting mechanism may be
the development of simple, effective and accessible information and complaint facilities, incorporating Kotler et al.s principle of consumer
protection. Examples of these facilities include,
in Australia, the Departments of Consumer
Affairs and of Fair Trade Practices, and the
Better Business Bureau (BBB) organisation in the
United States. Notwithstanding, these facilities
may again be challenging for ethnic minority
consumers, and there is evidence that they are
not always able to fulfill their purpose. Arguably,
the causes and implications of third party complaints, such as those filed with the BBB, are not
well understood . . . the line between poor
business practices . . . and deception or illegal

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Guilherme D. Pires and John Stanton

TABLE II
Possible consequences from unethical target marketing of minority ethnic groups

Dumping of lower quality, unsuccessful, defective, untried products. There may be an element of danger.
Similar to Cuis (1998) nature of product.
Emotional damage to consumers by use of stereotypes, ascription, etc., when consumers are affiliated to the
minority ethnic group. Similar to Cuis (1998) inadvertent bias.
Emotional damage to consumers by use of stereotypes, ascription, etc., when appearance, country of birth,
neighbourhood, etc., wrongly suggest affiliation to minority ethnic groups.
Emotional damage to consumers from exclusion from affiliation to a minority ethnic group when affiliation
in fact exists.
Price discrimination in relation to mainstream prices or prices to other minority ethnic groups (even if
price matches perceived net value).
Alienation of trusted sources, potential gatekeepers to the minority ethnic group, through bribes or similar
(Varner and Beamer, 1995).
Deliberate and deceptive omission or use of small print in contracts.
Deliberate overpricing or limiting access to services in order to capitalise on lack of market experience and
communication difficulties.
Infringement of consumer privacy, since the right to be left alone includes the right to be free from unwanted
marketing solicitations. For example, personal data ethically collected by a marketer into a database respecting
ethnic minority consumers autonomy as well as their informed consent and freedom to withdraw (Streiner
and Norman, 1996) may not be passed to other marketers (Fisher et al., 1999).
Racial discrimination similar to Cuis (1998) redlining.

tactics . . . remain unclear (Fisher et al., 1999,

p. 69).

Conclusion
Attention to ethnic marketing has been
increasing in the literature, although little attention has been devoted to potential ethics implications. This paper has argued that ethics issues
associated with differentiated marketing addressed
to minority ethnic groups appear not to be
amenable to procedures used in the international
context. In addition, the elaboration of a globalising code of ethics appears problematic, even
if a situational contingent approach is utilised,
arguably because exercise of the code will require
judgment to be exercised.
Reflection on identified ethics issues for ethnic
marketing explored some of the potential consequences arising from ethnocentric bias, one of
five areas of possible ethical failure in ethnic marketing. Some of these consequences were assessed
as possibly intrinsic rather than deliberate, suggesting that the ethical implications from marketing behaviour, both identified and yet to be

identified, may be augmented by unintended

unethical consequences.
While the analysis presented in this paper has
not differentiated between marketing situations
by the degree of intangibility of the product,
highly intangible service activities may justify
special attention by researchers and practitioners,
given the relative intensity of human involvement. These are important areas for managerial
consideration because the targeting of minority
ethnic consumers with ethically unsound strategies may lead to alienation of the ethnic markets.
Careful consideration needs to be exercised
before ethnic marketing strategies are developed
and implemented.
The unintended and augmented unethical
consequences of ethnic marketing are not well
understood. This understanding is a prime area
for further marketing research, both in general
and in specific contemporary developing areas,
such as e-commerce. Because different types of
activities and products may involve different
ethics issues, industry specific studies involving
ethnic groups will add to our understanding of
ethics in ethnic marketing.
Finally, the potential impact of ethnic mar-

Ethnic Marketing Ethics

keting on mainstream populations and their
sharing of one country with a variety of minority
ethnic groups can be the basis for building walls
between (or segregating) ethnic groups (Yanoov,
1999). The wider societal interest needs to be
considered.

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Guilherme D. Pires
University of Newcastle,
University Drive,
Callaghan, NSW 2308,
Australia
E-mail: mggp@alinga.newcastle.edu.au
John Stanton
University of Newcastle,
University Drive,
Callaghan, NSW 2308,
Australia
E-mail: ecjcs@alinga.newcastle.edu.au