Is Marketing Ethics an Oxymoron? Case Study Example

dilemma that challenges those professionals in marketing is on the surface an obvious one. When a company depends on its marketing professionals to assist in providing strong sales, there is an expectation that those professionals will aggressively pursue customers to the utmost of their ability. There is also the issues of ethics and social responsibility, which can have significant impact on the marketing decisions that a company makes. The purpose of this paper is  to review the essay titled “Is Marketing Ethics an Oxymoron?”, understanding the key issues presented while also providing evaluation and potential solutions to ethical challenges.

Key issues: first and foremost, how to differentiate normal marketing practices from unethical behavior? This is not a simple task, as individuals may differentiate in inconsistent ways. One business-centric argument is that if you provide for a customer’s needs that they will continue to purchase from you, vindicating your ethics. After all, why would a customer continue to do business with a company they feel is unethical? One would have to agree with this belief to a point, but this may be overly simplistic as sometimes consumers make wrong choices. They will at times choose something that is not good, as in the case of drugs or fattening foods.

Another issue would be that if we are to assume that businesses have a conflict of interest between generating sales and protecting all stakeholders, how do they mitigate these two concerns in a way where one is not sacrificed for the other? Examples provided in the essay include reducing side effects, such as lowering calories in foods/drinks to make them healthier. Another example would be limited intervention, which could include government or even corporate-imposed regulation that limits sales in certain situations to at risk stakeholders. This would be the reason why cigarette companies do not actively market their product to children, who are considered at risk from a product that would shorten their lives if they started to use it.

Facts: Companies can be expected to try to sell their products, and they will not intentionally act in a way that produces less profit. The benefit to this fact is that often it is the right business decision is to be ethical, maintaining sensitivity to all stakeholders and the effects a product has on all constituencies. Most companies are image conscious, and will be as quick to point out when they do behave in an ethical manner as they will be to correct situations when the public perceives them as acting unethically. For this reason, stakeholders often will play a primary role in this effort, and if they wish to change something about how a company conducts marketing, they must apply pressure to that company. This would in turn affect company sales, making the company more inclined to change marketing behavior as the right business decision.

Stakeholders: as identified in the essay, there are numerous stakeholders that must be considered by marketers and their corporations. Among these may include shareholders, communities, minorities and women, employees, the environment, foreign stakeholders, and customers. It is important to note that this list is not necessarily static, as there may be more or fewer stakeholders depending on the nature of the marketing and business. For public corporations, shareholders will be present and will likely be the stakeholder that the business will  typically consider above all others. After all, it is the shareholders that actually own and run a given business.

The problems: as noted in the key issues, drawing the line between effective marketing and unethical practices is a line people will interpret different ways, so establishing the right standards and/or approaches is a key challenge facing marketers and corporations. In addition, identifying solutions to potential conflicts between corporations and the various stakeholders will protect the business. As marketing is among the most visible and prominent activities that a company will implement, having a clear mission on how to present the company in a way that balances the needs of sales, growth and ethics will ensure continued success. These problems can be both legal and ethical in composition. From a legal perspective, governments do provide some oversight and regulation on business practices, and you want to avoid situations where punitive actions could be levied. From a social perspective, you also want to avoid offending stakeholders, so it is important to consider each group and the priorities that they will place upon your business and marketing practices.

Stakeholder perspectives: among key stakeholders would be shareholders, whose interest is in profitability and effective business strategies to achieve financial goals. These goals generally are designed to achieve a specific economic level of success. Although it certainly can be said that there are many shareholders who have high moral and ethical values, one can assume in many companies that the focus is more on financial performance. They expect the marketing to be highly focused on generating sales in most cases.

Communities can represent a broad array of people and beliefs, but the main interest would be on the impact a given business and/or marketing practice has on the local community. A goal for a community would be to seek benefit from the company and marketer. This could come in a variety of ways, such as investment, employment, sound environmental practices, etc. Within communities there is also potential for regulation, so this will almost always be a key stakeholder that must be considered.

Employees are another stakeholder that will almost always have to be considered. It is employees whom the shareholders depend upon to make their goals and further the aspirations of their company. Goals will vary by employee but can include standard of living, working conditions, prestige, and ambition. How employees perceive that the company is treating them and other stakeholders can have a profound impact on the business.

Customers are the ones whom a business must ensure are satisfied, as the business wants to continue to sell products to them. A dissatisfied customer will go elsewhere, so their perceptions of the ethical quality of the business are crucial to continued success. The goals of customers also can vary, but it can be assumed that they wish to be treated well, and they do not want to be tricked into buying something they do not need. Customers are the among the most sensitive and influenced of stakeholders to a marketing efforts.

Overall problem: The overall problem that must be overcome is to address conflicts between the need for a business to maximize profit, while at the same time addressing all stakeholders and maintaining a highly intact ethical standard. To achieve this, the business and its marketing must solve ethical conflicts of doing business with their stakeholders, most notably customers.

Solution #1: Focus on making ethical products. Business that avoid making products of questionable integrity will avoid the conflicts and baggage that will accompany them, while creating marketing opportunities for promotional efforts. An effective way of using this solution would be to take an existing product and address ethical concerns about it. This in turn will generate positive feelings about the company as they can market their ethical contribution to society. Hybrid cars, diet sodas, energy efficient lights, and many other products can make this claim.

Solution #2: Self-regulation. Although the essay takes a dim view of this approach, self-regulation can be an effective way of avoiding government regulation and also be effective at establishing a higher moral code for your company. It can show initiative when a company electively imposes regulation without it being forced, and can generate positive publicity that assists in the marketing effort. There are many good examples of how media companies in the past have exercised sound self-regulation to maintain the trust of government and the public in order to avoid perceived bias in how they report news and influence opinion.

Solution #3: Openness. Is is safe to say that many companies are more secretive than they  have to be, as they wish to keep specifics away from competitors and stakeholders on their business. Although it is plausible to assume that companies cannot be a total open book, they should strive for openness and communication whenever possible with all stakeholders. This approach has the added benefit of establishing trust, and from a marketing perspective can be effective at recruitment, employee relations, and closer ties to the community. For example, there are some corporations that have done away with offices almost entirely in order to foster closer communication with employees, and fewer secrets. This is but one example, but typifies an effective effort of establishing more trust and openness.