ETHICAL ISSUES IN MARKETING Introduction: Marketing, in contemporary times, has seen a tumultuous change in the way it's conducted

in developing countries. The oft cited dictum that only change is constant in the marketing genre is an apposite one. Just as the media of social communication themselves have enormous influence everywhere, so advertising and marketing, using media as their vehicles, are pervasive, powerful forces shaping attitudes and behavior in today's world. Four reasons are attributed to the fugacious nature of the way marketing practices are being carried out in developing countries 1. The role of Information and Communication technologies: As ICTs evolve so do marketing practices. If yesterday it was television that revolutionized the way advertisements could create a lasting impact on the consumer, then today the internet and phone text messages are doing just that. 2. The world today is an increasingly global village: Social and ethnic boundaries are fast falling in the wake of cable television and the like. 3. Rapid economic expansions in countries like China and India have meant that marketers have to quickly respond to the changing socio-economic scenarios. Millions of people have entered the middle class and millions more are poised to do so. For marketers, the consequences can be mind boggling-as incomes and spending powers rise, marketers have to respond to increasing demands from consumers. 4. Better and improved marketing research has meant that the entire populace is not seen in totality but rather as a congeries of different types of consumers.

THE UPSHOT: But the outcome of such developments is that a number of ethical issues have arisen. While the globe is indeed becoming a smaller place, marketers have to bear in mind national, local and cultural sensitivities. Very often, in the hope of tapping a larger consumer base, marketers jump headlong in new markets without keeping in mind ethnic and social issues typical to certain areas. While marketers do have to act with celerity in gaining footholds in emerging markets such as China and India, care has to be taken in ensuring that the mores, etiquettes of the land are not encroached upon. The incorporation of newer technologies has meant that a number of issues such as invasion of privacy and credibility have arisen. Ergo, in these rapidly changing circumstances, marketers and consumers alike face a nimiety of ethical issues that have to be addressed. This paper looks at some of the ethical issues in the developing countries context. EXPLOITING SOCIAL PARADIGMS In the hopes of making a fast buck, marketers often resort to exploiting social paradigms typical to certain areas. In India, for example, a large multinational corporation ran an ad campaign that depicted a young woman who because of her dark facial complexion was unable to find jobs. But as the ad showed, as soon as the woman started using the facial whiteness cream manufactured by the corporation, she got the job of her choice. Needless to say, there was a big backlash against it and the ad campaign had to be scrapped. On an ethical standpoint, marketers have to exercise restraint in exploiting such social paradigms to their commercial advantage.

SURROGATE ADVERTISEMENTS In India alcohol and cigarette advertisements were banned outright some years back. However, alcohol and cigarette companies alike are using the avenue of surrogate advertisements to press forward their case. For the viewer though, the 'subtle' pointer towards the real deal is enough as the surrogate advertisements leave no ambiguity in their minds. SUBLIMINAL ADVERTISEMENTS One of the most controversial and ethical issues in advertising is regarding subliminal advertisements. Inserting subliminal messages in an advertisement is an inherently misleading action. It is an attempt to manipulate a person's thinking without the person realizing that any such manipulation is occurring. The west has had its fair share of subliminal advertisements related hullabaloos primarily because the advertisement, marketing and regulating media themselves have been quite active in raising such issues. During the US Presidential elections of 2000, it came to light that a political advertisement for George W. Bush subliminally flashed the word 'RATS' when criticizing Al Gore's prescription medicine plan. While the ad maker denied that the quickly flashed word was a subliminal message designed to surreptitiously sling mud at Gore, many others, however, concluded that 'RATS' was indeed inserted with the intention of secretly causing viewers' to associate vermin with Al Gore. In line with the techniques of subliminal messaging, the questionable word appeared on the screen for only a microsecond (1/30th of a second), passing by so fast that it was almost unrecognizable to the conscious mind-especially when passively lulled by television. According to the theory of subliminal advertising the image would, indeed, register in a viewer's subconscious mind, thereby causing the viewer to negatively associate Al Gore with a rodent. The effects of subliminal advertisements are real and
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financially significant. Each year, consumers spend roughly $US50 million for selfhelp tapes embedded with subliminal messages that are supposed to teach a person a foreign language while they sleep, or help them lose weight, or quit smoking. Additionally, some stores embed subliminal messages in their background music in an effort to discourage shoplifting. Time magazine reported in 1979 that messages such as 'I am an honest person' and 'Stealing is dishonest' were being utilized in over fifty department stores. One department store utilizing the hidden messages reported a savings of $US600, 000 by reducing theft 37 percent during a nine month period. So, if subliminal messages evidently work in self-help tapes and embedded in department store music, it certainly seams reasonable that they would also work and perhaps even work better in a visual medium such as television. In developing countries the regulating watchdogs and related establishments are still in stages of latency so that the possibility that viewers who would be subject to such measures would probably never ever know that they were the focus of such procedures. The Ethical Issue of 'Creating Demand' In the words of Pope John Paul II, advertising also can be, and often is, a tool of the phenomenon of consumerism. Sometimes advertisers speak of it as part of their task to 'create' needs for products and services - that is, to cause people to feel and act upon desires for items and services they would ordinarily not need. A piquant issue arises when consumerist attitudes and values are transmitted by communications media and advertising to developing countries, where they exacerbate socio-economic problems and harm the poor. While a judicious use of advertising can stimulate developing countries to improve their standard of living, serious harm can be done to them if advertising and commercial pressure become so irresponsible that communities seeking to rise from poverty to a reasonable standard of living are persuaded to seek this progress by satisfying wants that have been

artificially created. The result of this is that they waste their resources and neglect their real needs, and genuine development falls behind.

PREDATORY PRICING In developing nations where the bulk of the populace is still employed in small and medium enterprises, the use of predatory pricing by large multinational corporations in order to wipe out competition is an ethical issue. While proponents of no holds barred pricing would attribute this to an unfettered free market, the fact remains that the larger issue is the threat of wiping out the livelihood of a large number of people. In India, a related issue is the entry of western discount stores that might eventually threaten the existence of millions of people employed in traditional mom-and-pop stores. Wal-Mart's 'takeover of small towns' in the U.S.A. is also a related concern. Countries like India need to take a leaf out of the China book-China opened its market to these stores in 1991 and only recently allowed 100% foreign direct investment (FDI) in such ventures. FALSE AND MISLEADING ADVERTISEMENTS Then there is the issue of false and downright disingenuous advertisements. While in itself this is an important ethical issue, an extension of this is the question of credibility. Nowadays, newspaper columns are rife with advertisements which blatantly compare features of brands with those of their competitors. Citing the opinion of 'experts', these advertisements claim their brands to be quantitatively and qualitatively better than those of their rivals. In India a leading car manufacturer had to recall its ad campaign when it incorrectly stated that one of its car models was superior to that of its competitor's.
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Post Purchase Dissonance What you see is not often what you get Since very often what companies claim their products or services deliver is not what the consumers actually get, the issue of post purchase dissonance arises. There are two more non-contrasting viewpoints on this issue. One states the typical examples of Tele-Shopping Networks (TSN) and the internet. Since there is no element of tangibility, the consumer would typically end up getting an end product which he/she didn't literally ask for. The other viewpoint states that such establishments would be punished by market forces since in today's world the consumer is undoubtedly the king. But in associating such concerns to the game play of market forces, the larger ethical issue is unfortunately trivialized. Depicting groups in stereotyped roles All too often, marketing contributes to the invidious stereotyping of particular groups that places them at a disadvantage in relation to others. Women and children unfortunately end up being cast as stereotypes in ad campaigns the world over. Often, the role of women in business or professional life is depicted as a masculine caricature, a denial of the specific gifts of feminine insight, compassion, and understanding. In India, which has traditionally been a patriarchal society, tremendous cultural changes have been brought in with the advent of cable television and the exposure to western content. Urban women are enjoying more freedom than they've had before. Yet, promotional campaigns of certain firms still show the Indian woman of yore-a fallback to a time when women did not enjoy the freedoms they have today. The ber kid In India, objections have been raised against advertisements that showed mothers benchmarking their children to the so called 'super-kid'- one who excels in studies and sports alike simply because he consumes a particular health drink.

Promotions of Alcohol, Tobacco Creating Demand for Vice Cigarettes are one of the most heavily marketed products in China and other developing nations. An increasing percentage of those marketing dollars is dedicated to what are probably the most sophisticated consumer marketing databases in the business world. Tobacco advertising is no longer just the province of multi-million dollar ad budgets pushing the Marlboro Man, Joe Camel's phallic face or the women in the Virginia Slims' ads who have 'come a long way.' It is equally the province of direct marketers, pushing free packs to targeted prospects and mailing slick magazines-published by tobacco companies-to influence the behavior and retain the loyalty of tens of millions of smokers And the problem is pandemic-is is prevalent in both developing as well as developed countries alike. In the US for example, cigarette smoking is responsible for the deaths of almost half a million people a year. Tobacco use is responsible for more than one in six deaths in the United States. Smoking accounts for 30% of all cancer deaths. It is a major cause of heart disease, and it is associated with conditions ranging from colds and gastric ulcers to chronic bronchitis, emphysema and vascular disease. Smoking caused an estimated 264,087 male and 178, 311 female deaths in the United States each year from 1995 to 1999. The U.S. Congress Office of Technology Assessment estimates the cost of smoking (direct and indirect) to the economy at $150 billion a year. Each day more than 3,000 teenagers in the U.S. become addicted to cigarettes. The tobacco industry argues that its advertising is not aimed at recruiting these young new smokers. Its representatives say, disingenuously, that advertising by individual tobacco companies' targets adults only and serve only to encourage regular smokers to switch brands or to retain brand loyalty. However it has been seen that perception of cigarette brand advertising actually is higher among young smokers and that changes in market share resulting
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from advertising occur mainly in this segment. Cigarette advertising thus undoubtedly encourages youth to smoke. In a survey conducted by the Journal of the American Medical Association, it was stated that the success of the tobacco industry is dependent on recruiting people who don't believe that tobacco kills-thus enticing children, developing nations populations, and disadvantaged members of society to smoke is the only way for tobacco companies to make up for the number of smokers who quit or die. INTRUSIVE PROMOTIONS A number of companies offer a plethora of freebies in terms of services and add-ons, however all these come with the proverbial strings attached. These are particularly true for telecom and internet services related companies. Mobile network providers in India for example are notorious for literally bombarding the users with promotional text messages. Many a times these companies share customer data with other companies without the explicit permission of the customers themselves. The issue at hand is such measures compromise the confidentiality of company-client relationships and trivialize the privacy concerns of the customers. Copyright, trademark violations Copyright and trademark violations are ubiquitous throughout the developing world. One of the major grouses of multinational corporations in countries like China and India is the lack of a robust legal framework that harshly penalizes violators. Data piracy is a major concern in South East nations and millions of illegal compact discs are made in such countries which cost software, music and movie companies billions of dollars.

ADVERTISEMENTS AS MIRRORS OF PREVAILING NORMS Marketers claim that advertising simply mirrors the attitudes and values of the surrounding culture. No doubt advertising, like the media of social communications in general, does act as a mirror. But, also like media in general, it is a mirror that helps shape the reality it reflects, and sometimes it presents a distorted image of reality. Advertisers are selective about the values and attitudes to be fostered and encouraged, promoting some while ignoring others. This selectivity does not impart credence to the notion that advertising does no more than reflect the surrounding culture. For example, the absence from advertising of certain racial and ethnic groups in some multi-racial or multi-ethnic societies can help to create problems of image and identity, especially among those neglected, and the almost inevitable impression in commercial advertising that an abundance of possessions leads to happiness and fulfillment can be both misleading and frustrating. Advertising also has an indirect but powerful impact on society through its influence on media. Many publications and broadcasting operations depend on advertising revenue for survival. This often is true of religious media as well as commercial media. For their part, advertisers naturally seek to reach audiences; and the media, striving to deliver audiences to advertisers, must shape their content so to attract audiences of the size and demographic composition sought. This economic dependency of media and the power it confers upon advertisers carries with it serious responsibilities for both.

THE ETHICAL ISSUE OF POLITICAL MARKETING Political advertising can support and assist the working of the democratic process, but it also can obstruct it. This happens when, for example, the costs of advertising limit political competition to wealthy candidates or groups, or require that office-seekers compromise their integrity and independence by over-dependence on special interests for funds. Such obstruction of the democratic process also happens when, instead of being a vehicle for honest expositions of candidates' views and records, political advertising seeks to distort the views and records of opponents and unjustly attacks their reputations. It happens when advertising appeals more to people's emotions and base instincts-to selfishness, bias and hostility toward others, to racial and ethnic prejudice and the like- rather than to a reasoned sense of justice and the good of all. Ethical Issues in Internet, e-commerce The Internet is quickly becoming a major conduit for business. On-line business has raised a host of new issues such as honesty and responsibility, accountability, privacy and confidentiality, protection of data (i.e. credit card numbers), freedom from invasiveness (i.e. so-called sticky websites that automatically track and retain customer contact and information), quality of the goods delivered, disclosure and reliability of information, sources of goods, Internet economics vs. traditional economics, impacts of global Internet business, employment through the net (local and global telecommuting), web advertising, competition on the Internet (hacking into data, falsification of data), public information and financial disclosure (investor relations on the Internet), and others. 1. The Small Print The major ethical issues facing business over the internet are the ones regarding the small print i.e. the policy notices or practices on websites. These issues include: A) Usage of obfuscating and vague language B) The policy may be hard to find or
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difficult to read and understand. C) It may not contain all the disclosures D) May fail to provide a contact address or procedures for dealing with complaints, corrections, or conflict resolution E) It may not have clear access requirements or procedures for verifying a valid requester before granting access. F) May not be linked to or displayed on every page where information is collected 2. World Wide Web versus the Wild Wild Web: To many, the utopian concept of the internet is that of a valueless zone-a free network that is outside the purview of human control and restrain. But we feel that line of reasoning is flawed. The internet is the progeny of civil society. This means that the World Wide Web is not the wild wild Web, but instead a place where values in the broadest sense should take a part in shaping content and services. This is recognition that the Internet is not something apart from civil society, but increasingly a fundamental component of it. 3. Ownership and Responsibility: The internet is largely a boundary less network. The involvement in content of companies hosting information is highly debatable. There are two sides to the proverbial coin: The Internet as a medium supports all kind of contents. By espousing the principle of allowing anyone to post any material on the net as a means of furthering information exchange is extended by many as the raison dtre of absolving the hosts of complicity of posting the material. In India, a major debate between the erudite arose when the CEO of the Indian chapter (bazee) of [Link] was arrested over charges of allowing the exchange of video clips showing explicit scenes. The sympathizers of the site owners cited the fact that the websites are merely enabling people to exchange data over a common platform. What information is exchanged

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does not fall under the purview of the responsibilities of the website managers. The opposing view was the hosts cannot turn a blind eye to the activities being carried out through the medium of their site. We feel that although, given the nature of the Internet, they cannot possibly be expected to pre-check content, once they receive a notification or a complaint about something they are carrying or hosting, they have to take a view. Thus if one is attempting to bring a sense of ethics to the Internet in any particular instance, it is essential to know who has the control and the responsibility. Increasingly the debate about the content of the Internet is not national but global, not by specialists but by the general populace. There is a real need for this debate to be stimulated and structured and for it to lead to 'solutions' which are focused, practical and urgent. Good Marketing Citizens All in all, it can be seen that ethical issues in marketing in the context of developing countries is highly sensitive to cultural, social and ethnical issues. The larger issue is thus not merely an occidental versus an oriental one. For the marketing fraternity to be a good ethical citizen, the onus lie on themselves-for indeed, marketers have to stop indulging in unethical practices and start respecting local mores and values.

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ETHICAL MARKETING Ethical marketing refers to the application of marketing ethics into

the marketing process. Briefly, marketing ethics refers to the philosophical examination, from a moral standpoint, of particular marketing issues that are matters of moral judgment. Ethical marketing generally results in a more socially responsible and culturally sensitive business community. The establishment of marketing ethics has the potential to benefit society as a whole, both in the short- and long-term. Ethical marketing should be part of business ethics in the sense that marketing forms a significant part of any business model. Study of Ethical marketing should be included in applied ethics and involves examination of whether or not

an honest and factual representation of a product or service has been delivered in a framework of cultural and social values. It promotes qualitative benefits to its customers, which other similar companies, products or services fail to recognize. The concern with ethical issues, such as child labor, working conditions, relationships with third world countries and environmental problems, has changed the attitude of the Western World towards a more socially responsible way of thinking. This has influenced companies and their response is to market their products in a more socially responsible way. The increasing trend of fair trade is an example of the impact of ethical marketing. In the 'Ethical Shoppers Price Index Survey' (2009) fair trade was the most popular ethical badge products could have. It also revealed that many consumers distrusted green claims. (The idea of fair trade is that consumers pay a guaranteed commodity price to a small group of producers, the producers agree to pay fair labor prices and conserve the environment - a fair deal for everyone.)

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The philosophy of marketing is not lost with this newfound ethical slant, but rather hopes to win customer loyalty by reinforcing the positive values of the brand, creating a strong citizen brand. However, this new way of thinking does create new challenges for the marketer of the 21st century, in terms of invention and development of products to add long-term benefits without reducing the products desirable qualities. Many brands have tried to use ethics to make themselves look responsible, often spinning environmental claims which has led to the term green wash (In research consumers have shown to have even less trust of ethical claims in ads than ordinary ads. media attention on ethics has resulted in many top brands suffering consumer boycotts. Although many brands have tried to use green issues, it has been noted that in research 2/3 of consumers responded more to ethical claims that relate to people rather than to than environment. Ethical marketing should not be confused with government regulations brought into force to improve consumer welfare, such as reducing sulfur dioxide emissions to improve the quality of the air. A government regulation is a legal remedy intended to mitigate or correct an ethical issue, such as pollution of the air that we all share. Enlightened ethical marketing is at work when the company and marketer recognize further improvements for humankind unrelated to those enforced by governments or public opinion. By way of example, the Coop Group refuses to invest money in tobacco, fur and any countries with oppressive regimes.

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ETHICS IN MARKETING Ethics are a collection of principles of right conduct that shape the decisions people or organizations make. Practicing ethics in marketing means deliberately applying standards of fairness, or moral rights and wrongs, to marketing decision making, behavior, and practice in the organization. In a market economy, a business may be expected to act in what it believes to be its own best interest. The purpose of marketing is to create a competitive advantage. An organization achieves an advantage when it does a better job than its competitors at satisfying the product and service requirements of its target markets. Those organizations that develop a competitive advantage are able to satisfy the needs of both customers and the organization. As our economic system has become more successful at providing for needs and wants, there has been greater focus on organizations' adhering to ethical values rather than simply providing products. This focus has come about for two reasons. First, when an organization behaves ethically, customers develop more positive attitudes about the firm, its products, and its services. When marketing practices depart from standards that society considers acceptable, the market process becomes less efficient sometimes it is even interrupted. Not employing ethical marketing practices may lead to dissatisfied customers, bad publicity, a lack of trust, lost business, or, sometimes, legal action. Thus, most organizations are very sensitive to the needs and opinions of their customers and look for ways to protect their long-term interests. Second, ethical abuses frequently lead to pressure (social or government) for institutions to assume greater responsibility for their actions. Since abuses do occur, some people believe that questionable business practices abound. As a result,

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consumer interest groups, professional associations, and self-regulatory groups exert considerable influence on marketing. Calls for social responsibility have also subjected marketing practices to a wide range of federal and state regulations designed to either protect consumer rights or to stimulate trade. The Federal Trade Commission (FTC) and other federal and state government agencies are charged both with enforcing the laws and creating policies to limit unfair marketing practices. Because regulation cannot be developed to cover every possible abuse, organizations and industry groups often develop codes of ethical conduct or rules for behavior to serve as a guide in decision making. The American Marketing Association, for example, has developed a code of ethics (which can be viewed on its Web site at [Link]). Self-regulation not only helps a firm avoid extensive government intervention; it also permits it to better respond to changes in market conditions. An organization's long-term success and profitability depends on this ability to respond. Several areas of concern in marketing ethics are explored in the remainder of the article. UNFAIR OR DECEPTIVE MARKETING PRACTICES Marketing practices are deceptive if customers believe they will get more value from a product or service than they actually receive. Deception, which can take the form of a misrepresentation, omission, or misleading practice, can occur when working with any element of the marketing mix. Because consumers are exposed to great quantities of information about products and firms, they often become skeptical of marketing claims and selling messages and act to protect themselves from being deceived. Thus,

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when a product or service does not provide expected value, customers will often seek a different source. Deceptive pricing practices cause customers to believe that the price they pay for some unit of value in a product or service is lower than it really is. The deception might take the form of making false price comparisons, providing misleading suggested selling prices, omitting important conditions of the sale, or making very low price offers available only when other items are purchased as well. Promotion practices are deceptive when the seller intentionally misstates how a product is constructed or performs, fails to disclose information regarding pyramid sales (a sales technique in which a person is recruited into a plan and then expects to make money by recruiting other people), or employs bait-and-switch selling techniques (a technique in which a business offers to sell a product or service, often at a lower price, in order to attract customers who are then encouraged to purchase a more expensive item). False or greatly exaggerated product or service claims are also deceptive. When packages are intentionally mislabeled as to contents, size, weight, or use information, that constitutes deceptive packaging. Selling hazardous or defective products without disclosing the dangers, failing to perform promised services, and not honoring warranty obligations are also considered deception.

OFFENSIVE PRACTICES

MATERIALS

AND

OBJECTIONABLE

MARKETING

Marketers control what they say to customers as well as and how and where they say it. When events, television or radio programming, or publications sponsored by a marketer, in addition to products or promotional materials, are perceived as offensive,

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they often create strong negative reactions. For example, some people find advertising for all products promoting sexual potency to be offensive. Others may be offended when a promotion employs stereotypical images or uses sex as an appeal. This is particularly true when a product is being marketed in other countries, where words and images may carry different meanings than they do in the host country. When people feel that products or appeals are offensive, they may pressure vendors to stop carrying the product. Thus, all promotional messages must be carefully screened and tested, and communication media, programming, and editorial content selected to match the tastes and interests of targeted customers. Beyond the target audience, however, marketers should understand that there are others who are not customers who might receive their appeals and see their images and be offended. Direct marketing is also undergoing closer examination. Objectionable practices range from minor irritants, such as the timing and frequency of sales letters or commercials, to those that are offensive or even illegal. Among examples of practices that may raise ethical questions are persistent and high-pressure selling, annoying telemarketing calls, and television commercials that are too long or run too frequently. Marketing appeals created to take advantage of young or inexperienced consumers or senior citizens including advertisements, sales appeals disguised as contests, junk mail (including electronic mail), and the use and exchange of mailing listsmay also pose ethical questions. In addition to being subject to consumer-protection laws and regulations, the Direct Marketing Association provides a list of voluntary ethical guidelines for companies engaged in direct marketing (available at their

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ETHICAL PRODUCT AND DISTRIBUTION PRACTICES Several product-related issues raise questions about ethics in marketing, most often concerning the quality of products and services provided. Among the most frequently voiced complaints are ones about products that are unsafe, that are of poor quality in construction or content, that do not contain what is promoted, or that go out of style or become obsolete before they actually need replacing. An organization that markets poor-quality or unsafe products is taking the chance that it will develop a reputation for poor products or service. In addition, it may be putting itself in jeopardy for product claims or legal action. Sometimes, however, frequent changes in product features or performance, such as those that often occur in the computer industry, make previous models of products obsolete. Such changes can be misinterpreted as planned obsolescence. Ethical questions may also arise in the distribution process. Because sales performance is the most common way in which marketing representatives and sales personnel are evaluated, performance pressures exist that may lead to ethical dilemmas. For example, pressuring vendors to buy more than they need and pushing items that will result in higher commissions are temptations. Exerting influence to cause vendors to reduce display space for competitors' products, promising shipment when knowing delivery is not possible by the promised date, or paying vendors to carry a firm's product rather than one of its competitors are also unethical. Research is another area in which ethical is sues may arise. Information gathered from research can be important to the successful marketing of products or services. Consumers, however, may view organizations' efforts to gather data from them as invading their privacy. They are resistant to give out personal information that might cause them to become a marketing target or to receive product or sales information.
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When data about products or consumers are exaggerated to make a selling point, or research questions are written to obtain a specific result, consumers are misled. Without self-imposed ethical standards in the research process, management will likely make decisions based on inaccurate information.

DOES MARKETING OVER FOCUS ON MATERIALISM? Consumers develop an identity in the market place that is shaped both by who they are and by what they see themselves as becoming. There is evidence that the way consumers view themselves influences their purchasing behavior. This identity is often reflected in the brands or products they consume or the way in which they lead their lives. The proliferation of information about products and services complicates decision making. Sometimes consumer desires to achieve or maintain a certain lifestyle or image results in their purchasing more than they need or can afford. Does marketing create these wants? Clearly, appeals exist that are designed to cause people to purchase more than they need or can afford. Unsolicited offers of credit cards with high limits or high interest rates, advertising appeals touting the psychological benefits of conspicuous consumption, and promotions that seek to stimulate unrecognized needs are often cited as examples of these excesses.

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SPECIAL ETHICAL ISSUES IN MARKETING TO CHILDREN Children are an important marketing target for certain products. Because their knowledge about products, the media, and selling strategies is usually not as well developed as that of adults, children are likely to be more vulnerable to psychological appeals and strong images. Thus, ethical questions sometimes arise when they are exposed to questionable marketing tactics and messages. For example, studies linking relationships between tobacco and alcohol marketing with youth consumption resulted in increased public pressure directly leading to the regulation of marketing for those products. The proliferation of direct marketing and use of the Internet to market to children also raises ethical issues. Sometimes a few unscrupulous marketers design sites so that children are able to bypass adult supervision or control; sometimes they present objectionable materials to underage consumers or pressure them to buy items or provide credit card numbers. When this happens, it is likely that social pressure and subsequent regulation will result. Likewise, programming for children and youth in the mass media has been under scrutiny for many years. In the United States, marketing to children is closely controlled. Federal regulations place limits on the types of marketing that can be directed to children, and marketing activities are monitored by the Better Business Bureau, the Federal Trade Commission, consumer and parental groups, and the broadcast networks. These guidelines provide clear direction to marketers.

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ETHICAL ISSUES IN MARKETING TO MINORITIES The United States is a society of ever-increasing diversity. Markets are broken into segments in which people share some similar characteristics. Ethical issues arise when marketing tactics are designed specifically to exploit or manipulate a minority market segment. Offensive practices may take the form of negative or stereotypical representations of minorities, associating the consumption of harmful or questionable products with a particular minority segment, and demeaning portrayals of a race or group. Ethical questions may also arise when high-pressure selling is directed at a group, when higher prices are charged for products sold to minorities, or even when stores provide poorer service in neighborhoods with a high population of minority customers. Such practices will likely result in a bad public image and lost sales for the marketer. Unlike the legal protections in place to protect children from harmful practices, there have been few efforts to protect minority customers. When targeting minorities, firms must evaluate whether the targeted population is susceptible to appeals because of their minority status. The firm must assess marketing efforts to determine whether ethical behavior would cause them to change their marketing practices.

ETHICAL ISSUES SURROUNDING THE PORTRAYAL OF WOMEN IN MARKETING EFFORTS As society changes, so do the images of and roles assumed by people, regardless of race, sex, or occupation. Women have been portrayed in a variety of ways over the years. When marketers present those images as overly conventional, formulaic, or oversimplified, people may view them as stereotypical and offensive.

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Examples of demeaning stereotypes include those in which women are presented as less intelligent, submissive to or obsessed with men, unable to assume leadership roles or make decisions, or skimpily dressed in order to appeal to the sexual interests of males. Harmful stereotypes include those portraying women as obsessed with their appearance or conforming to some ideal of size, weight, or beauty. When images are considered demeaning or harmful, they will work to the detriment of the organization. Advertisements, in particular, should be evaluated to be sure that the images projected are not offensive. Because marketing decisions often require specialized knowledge, ethical issues are often more complicated than those faced in personal life and effective decision making requires consistency. Because each business situation is different, and not all decisions are simple, many organizations have embraced ethical codes of conduct and rules of professional ethics to guide managers and employees. However, sometimes self-regulation proves insufficient to protect the interest of customers, organizations, or society. At that point, pressures for regulation and enactment of legislation to protect the interests of all parties in the exchange process will likely occur.

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FRAMEWORKS OF ANALYSIS FOR MARKETING ETHICALLY Possible frameworks:

Value-oriented framework, analyzing ethical problems on the basis of the values which they infringe (e.g. honesty, autonomy, privacy, transparency). An example of such an approach is the AMA Statement of Ethics.

Stakeholder-oriented framework, analyzing ethical problems on the basis of which they affect (e.g. consumers, competitors, society as a whole).

Process-oriented framework, analyzing ethical problems in terms of the categories used by marketing specialists (e.g. research, price, promotion, placement).

None of these frameworks allows, by itself, a convenient and complete categorization of the great variety of issues in marketing ethics. Power-based analysis Contrary to popular impressions, not all marketing is adversarial, and not all marketing is stacked in favour of the marketer. In marketing, the relationship between producer/consumer or buyer/seller can be adversarial or cooperative. For an example of cooperative marketing, see relationship marketing. If the marketing situation is adversarial, another dimension of difference emerges, describing the power balance between producer/consumer or buyer/seller. Power may be concentrated with the producer (caveat emptor), but factors such as over-supply or legislation can shift the power towards the consumer (caveat vendor). Identifying where the power in the relationship lies and whether the power balance is relevant at all are important to understanding the background to an ethical dilemma in marketing ethics.[2]

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Is marketing inherently evil? A popularist anti-marketing stance commonly discussed on the blogosphere[3] and popular literature is that any kind of marketing is inherently evil. The position is based on the argument that marketing necessarily commits at least one of three wrongs:

Damaging personal autonomy. The victim of marketing in this case is the intended buyer whose right to self-determination is infringed.

Causing harm to competitors. Excessively fierce competition and unethical marketing tactics are especially associated with saturated markets.

Manipulating social values. The victim in this case is society as a whole, or the environment as well. The argument is that marketing promotes consumerism and waste. See also: influenza, ethical consumerism, anti-consumerism.

Marketing has a major impact on our self-images, our ability to relate to one another, and it ruins any knowledge and action that might help to change that climate.

Marketing/Advertising creates artificiality and influences sexual attitudes.

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ETHICAL DANGER POINTS IN MARKET RESEARCH INCLUDE:

Invasion of privacy. Stereotyping.

Stereotyping occurs because any analysis of real populations needs to make approximations and place individuals into groups. However if conducted irresponsibly, stereotyping can lead to a variety of ethically undesirable results. In the American Marketing Association Statement of Ethics, stereotyping is countered by the obligation to show respect ("acknowledge the basic human dignity of all stakeholders" Market audience Ethical danger points include:

Excluding potential customers from the market: selective marketing is used to discourage demand from undesirable market sectors or disenfranchise them altogether.

Targeting the vulnerable (e.g. children, the elderly).

Examples of unethical market exclusion or selective marketing are past industry attitudes to the gay, ethnic minority and obese ("plus-size") markets. Contrary to the popular myth that ethics and profits do not mix, the tapping of these markets has proved highly profitable. For example, 20% of US clothing sales are now plussize. Another example is the selective marketing of health care, so that unprofitable sectors (i.e. the elderly) will not attempt to take benefits to which they are entitled. A further example of market exclusion is the pharmaceutical industry's exclusion of developing countries from AIDS drugs.

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Examples of marketing which unethically targets the elderly include: living trusts, time share fraud, mass marketing fraud] and others. The elderly hold a disproportionate amount of the world's wealth and are therefore the target of financial exploitation. In the case of children, the main products are unhealthy food, fashion ware and entertainment goods. Children are a lucrative market: "...children 12 and under spend more than $11 billion of their own money and influence family spending decisions worth another $165 billion", but are not capable of resisting or understanding marketing tactics at younger ages ("children don't understand persuasive intent until they are eight or nine years old". At older ages competitive feelings towards other children are stronger than financial sense. The practice of extending children's marketing from television to the school ground is also controversial (see marketing in schools). Other vulnerable audiences include emerging markets in developing countries, where the public may not be sufficiently aware of skilled marketing ploys transferred from developed countries, and where, conversely, marketers may not be aware how excessively powerful their tactics may be. See Nestle infant milk formula scandal. Another vulnerable group are mentally unstable consumers. The definition of vulnerability is also problematic: for example, when should endebtedness be seen as vulnerability and when should "cheap" loan providers be seen as loan sharks, unethically exploiting the economically disadvantaged? Chris Akabusi is the leading academic author of Marketing Ethics and his theories are widely debated.

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Pricing ethics List of unethical pricing practices.

Bid rigging Dumping (pricing policy) Predatory pricing Price discrimination Price fixing Price skimming Price war Supra competitive pricing Variable pricing

Ethics in advertising and promotion Ethical pitfalls in advertising and promotional content include:

Issues over truth and honesty. In the 1940s and 1950s, tobacco used to be advertised as promoting health. Today an advertiser who fails to tell the truth not only offends against morality but also against the law. However the law permits "puffery" (a legal term). The difference between mere puffery and fraud is a slippery slope: "The problem... is the slippery slope by which variations on puffery can descend fairly quickly to lies." See main article: false advertising.

Issues with violence, sex and profanity. Sexual innuendo is a mainstay of advertising content (see sex in advertising), and yet is also regarded as a form

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of sexual harassment. Violence is an issue especially for children's advertising and advertising likely to be seen by children.

Taste and controversy. The advertising of certain products may strongly offend some people while being in the interests of others. Examples include: feminine hygiene products, hemorrhoid andconstipation medication.

The advertising of condoms has become acceptable in the interests of AIDSprevention, but are nevertheless seen by some as promoting promiscuity. Some companies have actually marketed themselves on the basis of controversial advertising - see Benetton. Sony has also frequently attracted criticism for unethical content (portrayals of Jesus which infuriated religious groups; racial innuendo in marketing black and white versions of its PSP product; graffiti adverts in major US cities).

Negative advertising techniques, such as attack ads. In negative advertising, the advertiser highlights the disadvantages of competitor products rather than the advantages of their own. The methods are most familiar from the political sphere: see negative campaigning.

Delivery channels

Direct marketing is the most controversial of advertising channels, particularly when approaches are unsolicited. TV commercials and direct mail are common examples. Electronic spam and telemarketing push the borders of ethics and legality more strongly.

Shills and astroturfers are examples of ways for delivering a marketing message under the guise of independent product reviews and endorsements, or creating

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supposedly independent watchdog or review organizations. For example, fake reviews can be published on Amazon. Shills are primarily for message-delivery, but they can also be used to drive up prices in auctions, such as EBay auctions.

Deceptive Advertising and Ethics Another breach of marketing ethics has to do with the use of deceptive advertising. This form of advertising is not specific to one target market, and can sometimes go unnoticed by the public. There are a number of different ways in which deceptive marketing can be presented to consumers; one of these methods is accomplished through the use of humor. In a study conducted by Hassib Shabbir and Des Thwaites, 238 advertisements were assessed and 73.5% of them were found to have used deceptive marketing practices. Of those advertisements that were conducted deceptively, 74.5% of them used humor as a masking device in order to mislead potential customers. Part of what drives this study is the idea that humor provides an escape or relief from some kind of human constraint, and that some advertisers intend to take advantage of this by deceptively advertising a product that can potentially alleviate that constraint through humor. Through the study it was also found that all types of humor are used to deceive consumers, and that there are certain types of humor that are used when making certain deceptive claims. It is important to understand that humor is not the only method that is used to deter consumers minds from what a product actually offers. Before making important purchases, one should always conduct their own research in order to gain a better understanding of what it is they are investing in. ]

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The use of ethics as a marketing tactic Business ethics has been an increasing concern among larger companies, at least since the 1990s. Major corporations increasingly fear the damage to their image associated with press revelations of unethical practices. Marketers have been among the fastest to perceive the market's preference for ethical companies, often moving faster to take advantage of this shift in consumer taste. This results in the expropriation of ethics itself as a selling point or a component of a corporate image.

The Body Shop is an example of a company which marketed itself and its entire product range solely on an ethical message.

Green wash is an example of a strategy used to make a company appear ethical when its unethical practices continue.

Liberation marketing is another strategy whereby a product can masquerade behind an image that appeals to a range of values, including ethical values related to lifestyle and anti-consumerism.

"Liberation marketing takes the old mass culture critique consumerism as conformity fully into account, acknowledges it, addresses it, and solves it. Liberation marketing imagines consumers breaking free from the old enforcers of order, tearing loose from the shackles with which capitalism has bound us, escaping the routine of bureaucracy and hierarchy, getting in touch with our true selves, and finally, finding authenticity, that holiest of consumer grails." (Thomas Frank)

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Marketing strategy The main theoretical issue here is the debate between free markets and regulated markets. In a truly free market, any participant can make or change the rules. However when new rules are invented which shift power too suddenly or too far, other participants may respond with accusations of unethical behaviour, rather than modifying their own behaviour to suit (which they might not be able to anyway). Most markets are not fully free: the real debate is as to the appropriate extent of regulation. Case: California electricity crisis, which demonstrates how constant innovation of new marketing strategies by companies such as Enron outwitted the regulatory bodies and caused substantial harm to consumers and competitors. A list of known unethical or controversial marketing strategies:

Anti-competitive practices Bait and switch Planned obsolescence Pyramid scheme Vendor lock-in / Vendor lock-out Viral marketing / guerilla marketing

Controversial marketing strategies associated with the internet:

Embrace, extend and extinguish Search engine optimization Spamdexing Spyware / Adware
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Further issues in marketing ethics Marketing ethics overlaps with environmental ethics in respect of waste problems associated with the packaging of products.[31] Some, such as members of the advocacy group No Free Lunch, have argued that marketing by pharmaceutical companies is negatively impacting physicians'

prescribing practices, influencing them to prescribe the marketed drugs rather than others which may be cheaper or better for the patient.[32] Ethically thinking is responding to situations that deal with principles concerning human behavior in respect to the appropriateness and inappropriateness of certain communication and to the decency and indecency of the intention and results of such actions. In other words, ethics are distinctions between right and wrong. Businesses are confronted with ethical decision making every day, and whether employees decide to use ethics as a guiding force when conducting business is something that business leaders, such as managers, need to instill. Marketers are ethically responsible for what is marketed and the image that a product portrays. With that said, marketers need to understand what good ethics are and how to incorporate good ethics in various marketing campaigns to better reach a targeted audience and to gain trust from customers. Marketing ethics, regardless of the product offered or the market targeted, sets the guidelines for which good marketing is practiced. When companies create high ethical standards upon which to approach marketing they are participating in ethical marketing. 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,

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suppliers, and business partners. Ethical behavior should be enforced throughout company culture and through company practices.

The concepts of Corporate Social Responsibility (CSR) CSR is viewed as a comprehensive set of policies, practices and programs that are integrated into business operations, supply chains, and decision-making processes throughout the company wherever the company does business and includes responsibility for current and past actions as well as future impacts. The issues that represent a companys CSR focus vary by business, by size, by sector and even by geographic region. In its broadest categories, CSR typically includes issues related to : business ethics, community investment, environment, governances, human rights, market place and workplace .CSR goes beyond charity and requires that a responsible company take into full account of the impact on all stakeholders and on the environment when making decisions. This requires them to balance the needs of all stake holders with their need to make a profit and reward their shareholders adequately. For the new generation of corporate leaders, optimization of profits is the key, rather than the maximization of profit. Hence, there is a shift from accountability to share holders to social responsibility to customers and other stake holders. In todays competitive global marketing, ethics play a vital role, because we are dealing with human values and beliefs. Business spreads beyond boundaries. The marketer has to deal with cross country culture. Many MNCS like Mc Donald and Nestle had faced lot of problems because of neglecting ethical issues in their marketing practices. They have incurred billions of dollars in monetary values and
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above all losing thousands of valuable hybrid customers due to the adaptation of unethical advertising & promotional strategies. According to experts, marketing is viewed as human conduct and is subject to academic analysis and public scrutiny. Ethics is the study of the moral principles that guide the conduct. Historically, there have been two points of view on the study on ethics in marketing. The first is Let the buyer beware. From these points of view, the rights of the seller are central. A company has little regard for customers needs and wants. The other point of view is let the seller beware. Here, customer satisfaction is taken to an extreme. No matter what the customer does, it is ok. Which position is correct? How do we resolve the inevitable conflicts brought by these competing viewpoints? Corporate Social Responsibility (CSR) and Ethics in Marketing: Kotler and Levy, in their book, Corporate Social Responsibility define corporate social responsibility as a commitment to improve community well-being through discretionary business practices and contributions of corporate resources. Some of the benefits of being socially responsible include (a) enhanced company and brand image (b) easier to attract and retain employees (c) increased market share (d) lower operating costs and (e) easier to attract investors. A socially responsible firm will care about customers, employees, suppliers, the local community, society, and the environment. CSR can be described as an approach by which a company (a) recognizes that its activities have a wide impact on the society and that development in society, in turn supports the company to pursue its business successfully and (b) actively manages the economic, social, environmental and human rights. This

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approach is derived from the principles of sustainable development and good corporate governance. Marketing managers within different firms will see some social issues as more relevant than others. The relevance of a given social issue is determined by the companys products, promotional efforts, and pricing and distribution policies but also by its philosophy of social responsibility. Focus entirely in profits (and profitable firms typically serve society well) Explicitly incorporate social responsibility into its day-today marketing decisions to minimize negative effects on society and enhance positive effects Go even further and engage in social projects that are unrelated to the corporate mission and even detrimental to profits ( which could net out to be socially undesirable) The Success strategies of a Business formed out of abundance and grounded in ethics and cooperation are powerful and long-lasting and they help you feel good about yourself even while bringing in profits ( Shel Horowitz) Management must decide which of these three levels of social responsibility to adopt and which social issues are relevant to its business.

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Ethical Conflict faced by the Marketers: Marketers must be aware of ethical standards and acceptable behavior. This

awareness means that marketers must recognize the viewpoints of three key players: the company, the industry, and society. Since these three groups almost always have different needs and wants, ethical conflicts are likely to arise. Ethical conflicts in marketing arise in two contexts : First, when there is a difference between the needs of the three aforementioned groups ( the company, the industry, and society) a conflict may arise. Second and ethical conflict may arise when ones personal values conflict with the organization. In either case, a conflict of interest is a possible outcome. An example of the first type of conflict is the tobacco industry. Cigarettes have for many decades been a lucrative business. So, cigarette and tobacco marketing have been for companies and good for the tobacco industry. Many thousands of people around the world are employed in the tobacco industry. So, the world economy has been somewhat dependent on cigarettes and tobacco. However, cigarettes are harmful to society. There is documented proof that cigarette smoking is harmful to health. This is an ethical conflict for cigarette marketers. An example of the second type of conflict, when ones personal values conflict with the organizations occurs when a leader in the company seeks personal gain (usually financial profit) from false advertising. Cures for fatal diseases are one type of product that falls into this category of ethical conflict: In their greed to make a profit, a marketer convinces those who may be dying from an incurable disease to buy a product that may not be a cure, but which a desperately ill person (or members of his or her family) may choose to purchase in an effort to save the dying family member suffering. Promoting and marketing such products violates rules of marketing ethics.
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Ethical dilemmas facing marketing professionals today fall into one of three categories: tobacco and alcohol promoting, consumer privacy, and green marketing. Standards for ethical marketing guide business in efforts to do the right thing. Such standards have four functions: to help identify acceptable practices, foster internal control, avoid confusion, and facilitate a basis for discussion. Consumerism Consumerism is concerned with broadening the rights of consumers. The concepts of social responsibility and consumerism go hand-in-hand. If every organization

practiced a high level of social responsibility the consumer movement might never have begun. Consumerism is a struggle for power between buyers and sellers;

specifically, it is a social movement seeking to increase the rights and powers of buyers in relation to sellers. Sellers rights and powers are presented in the following list: To introduce any product in any size and style they wish into the marketplace, so long as it is not hazardous to personal health or safety or if it is hazardous, to introduce it with the proper warnings and controls To price the product at any level they wish, provided there is no discrimination among similar classes of buyers To spend any amount of money they wish to promote the product, so long as the promotion is not defined as unfair competition To formulate any message they wish about the product provided that it is misleading or dishonest in content or execution To introduce any buying incentive schemes they wish

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In contrast, here are buyers rights and power: To refuse to buy a product that is offered to them To except the product to be safe To expect the product to essentially match how the seller represented it To receive adequate information about the product

It is in the best interest of marketers to understand the level of consumer standards and the nature of consumer perceptions, as well as what is required to foster realism and accuracy among consumers. Marketing and the Natural Environment Another significant area of social concern is the environment. Marketing is ultimately dependent on the use of scarce resources to fulfill human needs, without harming or unnecessarily using scare resources. Marketing managers should help to determine which products are produced, and which products are indirectly affecting the environment: The natural resources and materials used The amount of energy required in the production process The residuals (e.g., waste water) that result from production The consumption of resources and energy that is required to use products ( cars, air conditioners) The generation of pollutants (e.g., exhaust fumes) in using products The amount of packaging material that may have to be discarded. (packaging comprises less than 14 percent of collectible solid waste, but consumers often estimate its share of that waste at 40 to 80 percent)
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Relationship Marketing and Ethics Nowadays, most ethicists believe that Relationship Marketing is a reasonable practice leading to positive relationships between buyers and sellers. Relationship marketing requires that rules are not necessarily contractual.. Relationship marketing allows buyers and sellers to work together. However, there are disadvantages to this approach- relationship marketing requires time to develop a list of expected conduct or rules of behavior. According to a recently published book on this subject, a shift in emphasis in marketing ethics towards buyers interests and away from sellers interests characterizes the new country. If this is true, new challenges are presented for marketing ethics and professionals in the field of marketing who want to conduct business in an ethical way. Green Marketing and Ethical Issues The next important areas the marketer need to know about what is the relevance of Social Marketing in order to protect the environment and to improve the quality of life and are concerned with issues that include conservation of natural resources, reducing environmental pollution, protecting endangered species, and control of land use. The three Rs of environmentalism are Reduce, Reuse, and Recycle. Many companies are finding that consumers are willing to pay more for a green product. become quite successful with their hybrid cars. Green marketing refers to the development and distribution of ecologically-safe products. It refers to products and packages that have one or more of the following characteristics: (1) are less toxic, (2) are more durable, (3) contain reusable materials,
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Toyota has

or (4) are made of recyclable material. environmentally responsible.

In short, these are products considered

To sight an example One Canadian Executive stated that Any marketing executive who does not put a green filter on their strategies is looking at losing market share. The whole idea of disposal is going to become unacceptable. In West Germany and Canada, Procter & Gamble has found high consumer acceptance of pouches of liquid detergents and fabric softeners so consumers can refill rather than discard large plastic bottles.

Cause Related Marketing and Ethics Cause-related marketing should not be confused with social marketing. A key

difference is that a major purpose of cause-related marketing is to help a business. It might be used to improve the image of the firm or to increase market share. The technique involves associating a business with a cause. Social marketing, on the other hand, is generally not associated with any company and issued solely to help society by dealing with a social problem. Cause-related marketing has to be done correctly or it can hurt a company. A firm may look like it is exploiting a charity. It is important for the firm to be transparent and honest about what it is doing. There should also be a fit between the company and the cause. A good fit would be, for example, might be a bottled water company and a cause, it deals with providing clean water for poor people in Asia and Africa.

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Social Marketing and Ethics Social Marketing is defined as the use of marketing principles and techniques to influence a target audience to voluntarily accept, reject, modify, or abandon a behaviour for the benefit of individuals, groups or society as a whole. Social marketing is usually done by a non-profit organization, government, or quasigovernment agency. The goal is either to steer the public away from products that are harmful to them and / or society (e.g., illegal drugs, tobacco, alcohol, etc.) or to direct them towards behaviors or products that are helpful to them and / or society (e.g., having family meals, praying together, etc.). Ethnic Marketing and Ethics Another aspect the marketer has to know about Ethnic Issues while going for global marketing and still take care of Ethics. Culture plays an important role in defining ethical standards because dissimilar cultures socialize their people differently, according to what is acceptable behavior. 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.

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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. The international environment is recognized as attracting more difficulties for marketers (Kotler et sl., 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, 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 both in the parent country and also in the host country.. 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). 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. Within such a scenario, ethnic

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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). 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. Ethical Norms and Values for Marketers Professional associations and accrediting bodies have identified guidelines for ethics in marketing. According to one of those associations, the American Marketing

Association, the following rules guide marketing behavior. The American Marketing Association commits itself to promoting the highest standard of professional ethical norms and values for its members. Norms are established standards of conduct that are expected and maintained by society and / or professional organizations. Values represent the collective conception of what people find desirable, important and morally proper. Values serve as the criteria for evaluating the actions of others. Marketing practitioners must recognize that they not only serve their enterprises but also act as stewards of society in creating, facilitating and executing the efficient and effective transactions that are part of the greater economy. In this role Marketers should embrace the highest ethical norms of practicing professionals and the ethical values implied by their responsibility toward stakeholders (e.g., customers, employees, investors, channel members, regulators and the host community). Responsibility of the marketer. Marketers must accept responsibility for the consequences of their activities and make every effort to ensure that their

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decisions, recommendations, and actions function to identify, serve, and satisfy all relevant publics: customers, organizations and society Honesty, Integrity and Quality are far more important than quick profits (Shel Horowitz) Rights and duties in the marketing exchange process: - Participants should be able to expect that products and services are safe and fit for intended uses; that communications about offered products and services are not deceptive; that all parties intend to discharge their obligations, financial and otherwise, in good faith; and that appropriate internal methods exist for equitable adjustment and / or redress of grievances concerning purchases Organizational relationships: - Marketers should be aware of how their behavior influences the behavior of others in organizational relationships. They should not demand, encourage, or apply coercion to encourage unethical behavior in their relationships with others. Conduct your business so as to build long term loyalty. When you get a customer, you want to keep that customer and build a sales relationship that can not only last years, but also create a stream of referral business. (Shel Horowitz) Marketers must do no harm. This means doing work for which they are appropriately trained or experienced so that they can actively add value to their organizations and customers. It also means adhering to all applicable laws and regulations and embodying high ethical standards in the choices they make. Marketers must foster trust in the marketing system. This means that products are appropriate for their intended and promoted uses. It requires that
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marketing communications about goods and services are not intentionally deceptive or misleading. It suggests building relationships that provide for the equitable adjustment and / or redress of customer grievances. It implies

striving for good faith and fair dealing so as to contribute toward the efficacy of the exchange process. Marketers must embrace, communicate and practice the fundamental ethical values that will improve consumer confidence in the integrity of the marketing exchange system. These basic values are intentionally aspiration and include honesty, responsibility, fairness, respect, openness and citizenship.

SOCIAL

RESPONSIBILITY

OF

BUSINESS

BY

MULTINATIONAL

COMPANIES IN INDIA In the last twenty years, MNCs have played a key role in defining markets and influencing the behavior of a large number of consumers. Globalization and

liberalization have provided a great opportunity for corporations to be globally competitive by expanding their production base and market share. Recent years have seen many progressive organizations in our country keenly playing a social role. In some of these organizations the approach has been to take up only business-centric activities, i.e., Which are directly relevant to their business. The guiding philosophy in these organizations is that social reasonability is good only if it pays.

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This approach benefits both the organization and the stake-holder. Thus, ITC has been afforesting private degraded land to augment the supply of raw material for its paper factory. Similarly, Hindustan Lever which requires good quality water for the manufacture of its food products has been improving the quality of water in many communities. Companies like Cadbury India, Glaxo and Richardson Hindustan are helping farmers to grow crops which serve as raw materials for them. Lipton in Eath district of Uttar Pradesh has started veterinary hospitals in the region from where it buys milk. British Gas (which sells compressed natural gas to India) has recently started teaching unemployed youngsters how to become mechanics for gas-based auto rickshaws in Delhi. In some other organizations the approach has been to take up such philanthropic activities in which they can make a difference. Coca Cola As one of the largest and most global companies in the world, Coca Cola took seriously its ability and responsibility to positively affect the communities in which it operated. The companys mission statement, called the Coca-Cola Promise, stated: The Coca-Cola Company exists to benefit and refresh everyone who is touched by our business. The Company has made efforts towards good citizenship in the areas of community, by improving the quality of life in the communities in which they operate, and the environment, by addressing water, climate change and waste management initiatives. Their activities also included The Coca Cola Africa

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Foundation created to combat the spread of HIV / AIDS through partnership with governments, UNAIDS, and other NGOs, and The Coca Cola Foundation, focused on higher education as a vehicle to build strong communities and enhance individual opportunity Coca Cola`s footprint in India was significant as well. The Company employed 7000 citizens and believed that for every direct job, 30 40 more were created in the supply chain. Like its parent, Coke Indias Corporate Social Responsibility (CSR) initiatives were both community and environment focused. Priorities included education, where primary education projects had been set up to benefit children in slums and villages, water conservation, where the Company supported community based rainwater harvesting projects to restore water levels and promote conservation education, and health.. PepsiCo Pepsi Cola is also helping in rural areas in their economic development. It further offered to transfer food-processing, packaging, and water-treatment technology to India. Pepsis bundle of benefits won four Ps for entering a market, Pepsi added two additional Ps, namely, politics and public opinion. Similarly almost all MNCs like Microsoft, Mc Donald, Nokia, Unilever, ITC are also adopting social responsibility of business in order to have sustainable market development and growth not only in their countries but also in the host countries. Several forces are driving companies to practice a higher level of corporate social responsibility: rising customer expectations, changing employee expectations,

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government legislation and pressure, the inclusion of social criteria by investors, and changing business procurement practices. Companies need to evaluate whether they are truly practicing ethical and socially responsible marketing. Business success and continually satisfying the customer and other stakeholders are closely tied to adoption and implementation of high standards of business and marketing conduct. The most admired companies in the world abide by a code of serving peoples interests, not only their own. The following are the suggestions that the society must use the law to define, as clearly as possible, those practices that are illegal, anti-social, or anticompetitive. Next, companies must adopt and disseminate a written code of ethics, build a company tradition of ethical behavior, and hold its people fully responsible for observing ethical and legal guidelines. And, individual marketers must practice a social conscience in their specific dealings with customers and various stakeholders. The future holds a wealth of opportunities for companies. Technological advances in solar energy, online networks, cable and satellite television, biotechnology, and telecommunications promise to change the world as we know it. As the same time, forces in the socioeconomic, cultural, and natural environments will impose new limits on marketing and business practices. Companies that are able to innovate new solutions and values in a socially responsible way are the most likely to succeed. It is my belief that good marketing is ethical marketing. Good marketing is about satisfying and developing a long-term relationship with our customers. Caring about your customers not only results in profits (or achieving your organizations objectives if an organization is not-for-profit), it is the ethical thing to do. Deceiving customers

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may help a firms profits in the short-run, but is not the way to build a successful business. The same goes for social responsibility. A firm has to care about all stakeholders: customers, employees, suppliers and distributors, local communities in which they do business, society, and the environment.

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Conclusion Ethical marketing refers to the application of marketing ethics into

the marketing process. Briefly, marketing ethics refers to the philosophical examination, from a moral standpoint, of particular marketing issues that are matters of moral judgment. Ethical marketing generally results in a more socially responsible and culturally sensitive business community. It promotes qualitative benefits to its customers, which other similar companies, products or services fail to recognize. The concern with ethical issues, such as child labor, working conditions, relationships with third world countries and environmental problems, has changed the attitude of the Western World towards a more socially responsible way of thinking. This has influenced companies and their response is to market their products in a more socially responsible way. Many brands have tried to use ethics to make themselves look responsible, often spinning environmental claims which has led to the term green wash (see green washing) In research consumers have shown to have even less trust of ethical claims in ads than ordinary ads. Media attention on ethics has resulted in many top brands suffering consumer boycotts. Although many brands have tried to use green issues, it has been noted that in research 2/3 of consumers responded more to ethical claims that relate to people rather than to than environment. Ethical marketing should not be confused with government regulations brought into force to improve consumer welfare, such as reducing sulfur dioxide emissions to improve the quality of the air. A government regulation is a legal remedy intended to mitigate or correct an ethical issue, such as pollution of the air that we all share. Enlightened ethical marketing is at work when the company and marketer recognize further improvements for humankind unrelated to those enforced by governments or
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public opinion. By way of example, the Coop Group refuses to invest money in tobacco, fur and any countries with oppressive regimes. Points to be taken into consideration 1. The most often mentioned ethical problem faced by marketers is bribery. Five other issues (fairness, honesty, pricing strategy, product strategy, and personnel decisions) were also frequently cited as difficult ethical problems. 2. The primary ethical conflict reported by marketing managers involved balancing demands of the corporation against customer needs. 3. Marketing managers perceive many opportunities in their firms and industries to engage in unethical behavior. However, they reported that few managers engaged in such behaviors. 4. Marketing managers do not believe that unethical behaviors in general lead to success. However, many believe that successful marketing managers do engage in certain specific unethical behaviors. 5. When top management reprimands unethical behavior, the ethical problems perceived by marketing managers seem to be reduced. 6. The existence of corporate or industry codes of ethics seems to be unrelated to the extent of unethical problems in marketing management.

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Bibliography:

Miriam H. Zoll, Psychologists Challenge Ethics of Marketing to Children, (2000).[15]

Donnell Alexander and Aliza Dichter, Ads and Kids: How young is too young?[16]

Rebecca Clay, Advertising to children: Is it ethical?[17] (Monitor on Psychology, Volume 31, No. 8 September 2000), American Psychological Association

Media Awareness Network. How marketers target kids.[18] Barnett, Tim, Bass, Ken, Brown, Frederick, and Hebert, J. (1998). "Ethical Ideology and the Ethical Judgments of Marketing Professionals." Journal of Business Ethics May: 715-723.

Berman, Barry, and Evans, Joel R. (1998). Retail Management: A Strategic Approach, 7th ed. New York: Prentice Hall.

Bone, Paula F., and Corey, Robert J. (1998). "Moral Reflections in Marketing." Journal of Macromarketing Fall: 104-114.

"Federal Trade Commission Deception Policy Statement."[Link] 1983.

Ferrell, O. C., Hartline, Michael D., and McDaniel, Stephen W. (1998). "Codes of Ethics Among Corporate Research Departments, Marketing Research Firms, and Data Subcontractors: An Examination of a ThreeCommunities Metaphor." Journal of Business Ethics April: 503-516.

"FTC Guides Against Deceptive Pricing." [Link] 1998.

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Gustafson, Robert, Popovich, Mark, and Thomsen, Steven. (1999). "The 'Thin' Ideal." Marketing News March 15:22.

Jones, Thomas M., and Ryan, Lori V. (1998). "The Effect of Organizational Forces on Individual Morality: Judgment, Moral Approbation, and Behavior." Business Ethics Quarterly July: 431-445.

Koehn, Daryl. (1999). "Business Ethics Is Not a Contradiction." San Antonio Business Journal12(49) (January): 38.

Kotler, Philip, and Armstrong, Gary. (1999). Principles of Marketing, 8th ed. New York: Prentice-Hall.

Mahoney, Ann I. (1999). "Talking About Ethics." Association Management March: 45.

Murphy, Patrick E. (1998). "Ethics in Advertising: Review, Analysis, and Suggestions." Journal of Public Policy and Marketing Fall: 316-319.

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