Free Marketing Essays - Discuss the ethical controversy arising from a contemporary marketing campaign
Introduction:
Modern Marketing is one of the most difficult issues in the time being, some researchers stand firmly against the current methods of marketing corporations and consider it totally unethical because it hides the sins of the corporation and make it socially acceptable while others see that there is still a point where we can strike a balance between contemporary marketing strategies and corporate social responsibility.
Main body:
Absolute approach:
Moral absolutism assumes that there are moral principles that they are always and everywhere right and applicable, George, R (1986).
In this approach I have chosen some extreme examples of corporations acting as monstrous entities that are trying to control and narrow down the choice of the consumer and manipulate the minds of children:
Is advertising right?
Corporations are economic entities that combine the financial resources and the human resources of many people in order to manufacture goods and services, the ownership is separate from management and shareholders are protected by limited liability, the freedom of the corporation comes from the freedom of the individuals who established the corporation.
This school of thought considers corporations socially irresponsible because they only aim to maximise their profits, this view considers corporations as profit making machine and that corporations do not have to provide benefits to the society because they are not charities.
This schools thinks that, All these factors have urged corporations to try to improve their image by building global brands and leading marketing and public relations campaign.
Instead of taking their social responsibility seriously, corporations are constantly trying to improve their image by increasing their spending on contemporary marketing campaigns.
According to this view, advertising is not justified because it only tries to maximise the profit of the corporation and hide the truth about the corporation, which will not be used in serving the society or the employees or the country.
This school thinks that the drop in the government expenditure is a direct result of the corporation’s pressure to make more profits even if that required hospitals, research, and universities to close main departments or be under funded.
Schools, universities and hospitals have to find their own ways of financing the gap between their financial needs and the available resources of the government.
Allowing multinational corporations to launch marketing and advertising campaigns in education institutions has become a common tool for most of the education institutions in the US including primary schools and universities in order to keep these institutions financially self-funded.
Primary schools have opened their cafeterias and classrooms to corporations, which want to serve food and drinks in return for computers and video cameras, (Klein, N (2000). Researchers find that totally unfair because what corporations are giving the schools is not equivalent to what schools are giving the corporations; corporations are getting the children used to their brands since they are young, children will not only buy their products while they are in the schools but they will continue in buying these products throughout their lives.
Some researchers consider this type of marketing anti-democratic since it manipulates the emotions and the set of believes to the consumers, which are the children in this case; the difference between the normal consumer and the child consumer is the fact that children are irrational and they are not aware of the benefits and dangers of what they are consuming plus they are brainwashed since their childhood by believes that they did not really have the chance to investigate or verify, for example: McDonald’s and Pizza Hut are the ideal food to eat, although research showed that this food causes children obesity.
Mergers, acquisitions and marketing ethics:
Mergers and acquisitions forced many small companies to be owned and controlled by few multinational corporations, most of the mergers aim to create synergy between the merged companies in order to cut costs and maximize profits of the conglomerate.
Corporations are making many mergers and acquisitions in order to expand their market share by oppressing competition and limiting choice in the face of the consumer.
Companies are increasingly using very sophisticated marketing techniques in order to
Hide the truth about the mergers and acquisitions such as using celebrity stars to justify selling their products at very high prices.
Actually, the huge costs of using celebrity stars and marketing campaigns are not the only reason for the surge in the prices of products and services but the lack of competition that mergers have created.
Corporations are creating in the mind of customers a false value of their products, this is considered immoral.
Internet and marketing ethics:
Nowadays, mass media is not the only medium that is used in order to expand the company’s market share; Ads are personalised; on-line shopping of the AOL members is monitored and every click is counted; these data are all sold to companies that want to tailor a specialist promotions and ads on the client’s screen name, this has created a controversy about the morality of monitoring the whole web browsing experience of customers. Nowadays many employees, wives, businessmen spend most of their day on the net, it is morally unjustified to monitor those people.
Loyalty cards and marketing:
Corporations are improving their marketing strategies and getting as much information as possible about their consumers via using loyalty cards.
Tesco is using its club card in order to know where, when and how individual consumers shop; all this information is collected by a central database and analysed thoroughly in order to maximise profits and product availability.
Using this sophisticated information has given Tesco the chance to make £2 billion pounds of profit this year.
Collecting information has helped many companies design more effective marketing campaigns and be able to manipulate consumer’s minds.
The problem is not in collecting and analysing data but in how companies use the information and research findings; companies are accused of using research findings to improve its branding and marketing techniques, which are of little benefit to the consumer, rather than improving on the physical product itself.
Concentrating on the spiritual side depends on creating a false picture about the product in the consumer’s minds.
There is another crises evolving about the ownership of this information; this information gives corporations an advantage over small companies, this information should be shared on a common database among all industry participants in order to compete on an equal footing with each other.
Researchers fear that we are increasingly living in a “big brother state” where companies and governments know almost everything about consumers.
Rationality, need and advertising:
Normally marketing starts by researching the needs of the customer and building products that the customers really need and able to buy.
Corporations are accused of wasting the resources of the society by manufacturing products that the customers do not need and selling it by making massive advertising campaigns that lead customers to taking immoral decisions regarding buying products that they do not really need.
Because of repetitive advertising and fear messages in the advertising, people are buying more food than what they need, this has caused massive waste in the amount of fresh food thrown away in the bins, customers do not need all this amount of food but they are buying it because they want to avoid the pain resulting of not buying it, Arthur & Quester(2003).
This is not justice because many people in the world are dying from hunger.
Ethical relativism approach:
Relativism depends on the fact that there is no right or wrong, true and false, moral judgements are simply statement of opinions or feelings that can be changed, George, R (1986)
In this section we will reply to the arguments of the absolute approach:
Is advertising right?
Researchers who belong to the view of “legal creatures” of the corporation say that the freedom of the corporation results from the freedom of the individuals, the corporation is working within the law to serve a society that have certain law.
Individuals have combined their financial and human capabilities in order to create the corporation; the primary objective of the corporation is to make profit, the corporation may serve the society while its making profit but it does not have to serve the society all the time.
In the process of making profits, corporations need to advertise and publicise themselves, even if the advertising is part of the society disliked that (seen as immoral).
When corporations provide computers to primary schools in return for selling food, they aim to maximise their profits by investing in these schools (computers, providing internet.), this is totally justified because corporations are doing what they are supposed to be doing (making profit).
Mergers, acquisitions and marketing ethics:
The supporters of the relative approach say that mergers are not always done by force, many businesses become obsolete because better ways of producing products evolve over time.
Not all businesses know about innovations and new ideas in their industries, that’s why some companies become stronger and more able to control markets and prices.
Strong companies want to maximise their profits by selling more of the same product or by increasing prices and that’s what corporations do when they get the chance.
Using celebrity stars, in that sense, in order to increase prices is justified because the celebrity has to get huge sums of money and the company should add this cost plus additional profit to the price of the product.
From relative point of view, these practices are justified so long as consumers are happy to buy and the corporation is making more profit.
Internet and marketing ethics:
Supporters of this school consider collecting information about costumer’s Internet browsing totally justified because it makes the corporation more able to meet customer expectations and demands and make profit.
Advertising personalised ads is considered better to the customer and to the company because it shows that the company knows in advance what the customer is looking for and that it is caring about him.
This will encourage the customer to spend more money with the company and give the company the chance to make more profit.
Making more profit via spending will be reflected in a better macroeconomic environment and better company growth and job growth.
In the majority of the corporate actions, there is a benefit to the society; we can always try to avoid the harm by legislation Cannon, T (1994).
Loyalty cards and marketing:
According to the relative approach, loyalty cards are very good way in serving the customer and the society.
Loyalty cards improve product availability to the customer and give the customer a better choice of products and services.
Loyalty cards gives the supermarket, the airliner and the other companies the chance to learn more about the customer in order to maximise the wealth of the society, supermarkets reward customers for using them and using them is voluntarily.
Customers decided to sign up for them and they agreed to the terms and conditions, and above all maximising the corporation profits by using this information is in the advantage of the society because it increases the wealth of the society.
The supermarket should own the information because the supermarket has invested huge sums of money in IT in order to collect and analyse this information.
Anyway, the development of the information technology will give corporations more detailed information about the customer spending, corporations which do not invest in the new IT have to fail and they will be sold out to big corporations so it is not about who owns the information, it is about who have the ability to invest in IT.
Rationality, need and advertising:
It is true that advertising makes people buy products that they do not need but this is still very useful.
Advertising is making people buy Ipods and electric toothbrush. Not all the people need Ipods, but manufacturing and selling Ipods is not really harmful, it is quite the opposite it is very useful.
This type of selling teaches the people how to change and make the change easier.
These ideas that make a development to how we make products create new opportunities and chances in the society.
The corporation should have the right to advertise new products that contain new ways of serving the customers.
Delivering fear messages to customers in order to make them buy products beyond their means is totally justified because customers have the liberty of making choices and they should bear the responsibility of their choices.
Conclusion:
We cannot decide whether the contemporary marketing is ethical or not, the ethicality depends on whether the person belongs to the absolute or the relative schools of thoughts.
References:
1. Arthur & Quester(2003): the Ethicality of using fear for social advertising, Australian Journal of Marketing, 11(1). http://www.marketing.unsw.edu.au/AMJ/V11_1/Arthur_Quester.pdf
2. Bakan, J (2004): the corporation: the pathological pursuit of profit and power, Constable and Robinson ltd.
3. Cannon, T( 1994): Corporate Responsibility: a textbook on business ethics, governance, environment: roles and responsibilities, Prentice Hall
4. George, R (1986): Business Ethics: Macmillan Publishing Company New York, second edition.
5. Klein, N (2000): no logo, flamingo.
