2-1. What are business ethics, and why is this an important topic?
Business ethics are rules of conduct that guide actions in the marketplace. These are the standards
against which most people in a culture judge what is right or wrong, good or bad. However, the
notions of right and wrong differ among people, organizations, and cultures. This is an important
distinction as we learn to work with those of other cultures. (2 minutes, Chapter Objective 1, AACSB:
Reflective Thinking)
2-2. The economics of information perspective argues that advertising is important. Why? This view
emphasizes the economic cost of the time spent searching for products. Accordingly, advertising is a
service for which consumers are willing to pay, because the information it provides reduces search
time.
(2 minutes, Chapter Objective 1, AACSB: Reflective Thinking)
2-3 What are the main features of consumerspace? Does it actually work as a methodology?
Many people now feel empowered to choose how, when, or if they will interact with
corporations as they construct their own consumerspace. In this new environment, individuals
dictate to companies the types of products they want and how, when, and where (or even if)
they want to learn about those products. In turn, companies need to develop and leverage
brand equity in bold new ways to attract the loyalty of these consumer “nomads.” People still
“need” companies—but in new ways and on their own terms. As we’ll see throughout this
book, profound changes in consumer behavior are influencing how people search for product
information and evaluate alternative brands. In the brave new world of consumerspace, we
have much greater potential to shape our own marketing destinies.
2-4 Why should companies encourage consumers to complain? How can this benefit the
business?
Ironically, consumers who are satisfied with a store in general are more likely to complain if
they experience something bad; they take the time to complain because they feel connected
to the store. And, if a company resolves the problem, customers feel even better about it than
if they hadn’t complained in the first place!31 The moral: Although nobody likes criticism,
organizations should encourage people to complain for these reasons:
1 They get the chance to correct the situation.
2 They will avoid an escalating problem that results when consumers take to social media to
let others know they’ve been treated badly. People are more likely to spread the word about
unresolved negative experiences to their friends than they are to boast about positive
occurrences.
3 They collect valuable insights about customers’ experiences that will (hopefully) help them
to improve for future customers.
4 If consumers do not believe that the store will respond to their complaint, they will be more
likely to simply switch than fight as they just take their business elsewhere.
2-6 In what ways is corporate social responsibility different from social marketing?
Social marketing strategies use the techniques that marketers normally employ to sell beer
or detergent to encourage positive behaviors such as increased literacy and to discourage
negative activities such as drunk driving.50 Many researchers help to evaluate or create public
policies to ensure that products are labelled accurately, to certify that people can
comprehend important information in advertising messages, or to prevent children from being
exploited by program-length toy commercials that masquerade as television shows.
Many firms today try to integrate corporate social responsibility (CSR) into their business
models. CSR describes processes that encourage the organization to make a positive impact
on the various stakeholders in its community including consumers, employees, and the
environment. For example, the shoe company TOMS is well-known for its promise to give a
needy child a pair of shoes for every pair it sells.
CSR is more than a nice idea; it’s also good business. Consumer research convincingly shows
that, all things equal, people are likely to choose a brand that gives back to the community.
Cause marketing is a popular strategy that aligns a company or brand with a cause to
generate business and societal benefits.
2-7 Why is market access an important aspect of consumer well-being? What are some important
reasons why consumers can experience limited market access?
Market access is the consumer’s ability to find and purchase goods and services. Access might be
limited because of physical, mental, economic, or social barriers. There are 11 million U.S. adults
that have conditions that m make it difficult for them to leave home to shop. This can be minimized
through the use of technology and other resources. (2 minutes, Chapter Objective 2, AACSB:
Reflective Thinking)
2-8. What is greenwashing, and why is it a problem for marketers?
Greenwashing is the promotion of environmentally friendly products, but often, the claims are false
or exaggerated. Studies show that almost one-fourth of U.S. consumers feel they have no way of
knowing how true a claim might be, and one report shows that 95 percent of consumer companies
that market products as ―green‖ make misleading or inaccurate claims.
(2 minutes, Chapter Objective 3, AACSB: Reflective Thinking)