MARKETING STRATEGY

O.C. FERRELL • MICHAEL D. HARTLINE

Marketing Ethics and

Social Responsibility

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The Pyramid of Social Responsibility

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Potential Ethical Issues in Marketing

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 Ethics, Social Responsibility,
and Marketing Performance
• Firms that are ethical and socially
responsible are rewarded with greater
marketing performance.
• Having a strong ethical climate:
– Increases employee commitment
– Is conducive to a strong market orientation
– Creates trust among a firm’s stakeholders
– Increases customer loyalty

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 MORALITY AND BUSINESS ETHICS

• Developing an ethical base for business and personal

conduct
– Examine consequences of a particular act
• Who is helped or hurt?
• How long lasting are the consequences?
• Greatest good for the greatest number?

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 MORALITY AND BUSINESS ETHICS

• Developing an ethical base for business and personal

conduct
– Create personal universal decision rules
• Always treat others as you would like to be treated.
• It is wrong to lie, bribe, or exploit.
• If it is against the law, it should not be done.
• What would your mom think if she knew what you
decided?
• Picture your actions in the headlines.

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 Corporate Actions

• Avoiding unreasonable pressure on employees to

perform.
• Communicating clearly what is expected of
employees.
• Employing an “Ethics Officer” to advise
employees on ethical dilemmas.
• Rewarding only ethical performance.

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 ETHICS AND THE CONSUMER

• Consumers also have ethical responsibilities

in dealing with organizations.
• The rise in shoplifting, vandalism, consumer
fraud and other abuses indicates serious
problems.

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 Are you an angel?
• Shoplifting
• Switching price tags
• Returning used clothing
• Returning products you damaged
• False coupon redemption
• Damaging merchandise (for discount)
• Copyright violation (books, music, software…)

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 Sustainability – The New Buzz
• “Green Marketing” and “Environmental
Responsibility” have evolved into the concept of
“Sustainability.”
• Sustainability is about meeting the needs of our
generation without compromising the ability of
future generations.
• A sustainable enterprise makes decisions that
contribute to financial success, but also consider
impact on the world and long-term consequences.

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 Triple Bottom Line
• Coined by John Elkington
• Challenge companies to consider:
– Economic/profit aspects
– Environmental costs
– Social costs

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 Aspects of Sustainability
• Ecology; Economics; Social Justice
• Some Major Issues:
– Conservation and climate change
– Globalization
– Corporate reform
– Human and labor rights
– Population growth and health
– Social and environmental justice
– Trade and organic farming

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 Systems Theory
Economic Systems Social Systems
Money, Trade, Corporations Religion, Culture, Aesthetics
“Corporate Responsibility” Political Systems “Individual/Group Behaviors”
Government, Legal
“Regulation & Incentives”

Environment System
Goal: Survival
(Sustainability)

• Economic, Political, and Social Systems interact to:

1) Ensure survival of the Environment System
2) Enhance quality of life (economically & socially)
• Science & technology form the backbone of progress.
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 What Can We Do?
• Business:
– Find ways to practice sustainability while adding
value for customers.
– Be proactive.

• Consumers:
– Vote with your dollars (and actual votes)!
– Practice what you preach and believe.

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 What Can We Do?
• Government:
– Provide appropriate incentives to encourage R&D,
production, and purchasing of responsible products.
– Regulate where necessary.
– Direct investment in sustainable building/infrastructure

• Science:
– Provide innovative ways to develop sustainable, quality
products and improve biodegradability and recycling.
– Develop clean energy options.

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 Resources
• The Sustainability Revolution: Portrait of a
Paradigm Shift, by Andres R. Edwards, New Society
Publishers, 2005
– Explains development of sustainability movement; includes
multiple frameworks/principles; has an extensive list of
resources (web sites & articles)
• Green to Gold, by Esty & Winston, Yale University
Press, 2006
– How smart companies use environmental strategy to
innovate, create value, and build competitive advantage

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 Resources
• Hot, Flat, and Crowded: Why We Need a
Green Revolution—and How It Can Renew
American, by Thomas Friedman, FSG Books,
2008
– Fantastic book about our current situation and
what can be done about it

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That’s All Folks!

Questions?
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