Session 9: Marketing in Society, M Patterson

Tags: Maurice Patterson, organisations, developing countries, ethical issues, Oxford University Press, K. Armstrong, Haagen Dazs, Contemporary Sport Management, social services, social problem, Ethics and Morality in Sport Management, consumption, Maurice Patterson DeSensi, P. Murphy, J. Parks, Fitness Information Technology Inc., R. Burton, C. Fill, Human Kinetics, environmental deterioration, D. Rosenberg, Sport Marketing, social marketing, promoting products, social role, corporate social responsibility, marketing efforts, advertising, Maurice Patterson Marketing, sports marketing, consumer society, social responsibility, social and ethical issues, macro marketing, responsible practices, food advertising, modern society, business organisations, Societal Marketing, business practices
Content: Maurice Patterson Session 9: Marketing in Society «Email»
Maurice Patterson Marketing in Society
Learning Outcomes · To appreciate marketing's role in society. · To consider how ethical, social and cultural considerations should influence marketing decision making. · To critically reflect on marketing's changing social role.
Introduction So far in this module we have considered how marketing contributes to the firm and through this process, how consumers benefit from marketing efforts. Lazer (1969) outlines how promoting products and services is a fundamental Social Responsibility of marketing. By stimulating demand in the marketplace, marketing contributes to the development of the economy. By necessity, this sometimes requires promises of value that can never be truly satisfied. We have to leave the consumer wanting more and so we have developed aesthetic innovation, planned obsolescence, and fashion. In this argument, doing good marketing is equivalent to doing good. However, there are many people who believe that marketing is not benign ­ that its impact on firms and individual consumers does not automatically translate into a positive impact on society as a whole. Indeed, marketing is increasingly attracting negative impact for a whole host of reasons and, in particular, it is Advertising and promotion that have come in for most criticism. Indeed, in respect of sports marketing Laczniak et al. (1999: 48) state that "no sector of sports marketing is more rife with Ethical Issues than the area of promotional strategy". In this session we will evaluate marketing's role in society and how it has helped create the world we live in today. While there are lots of benefits to living in a consumer society, there is also some recognition that globalisation, the limits of natural resources, and population explosions in developing countries raise questions about whether capitalism in its current form is sustainable. Following several examples of irresponsible big businesses, including Exxon and Enron, there has been a re-engagement with the axiom that business has a duty to society (Ackerman, 1973). Indeed, current thinking suggests that not only should business not do harm, but ultimately its impact on society should be positive (Handy, 2002). As a result, there has never been a greater need for marketing to be ethical and to be seen to be ethical. The ethical issues that marketers need to consider include the effect(s) of targeting demographic groups that are perceived as vulnerable or at risk. This could include the marketing of junk food or violent video games to children. Indeed, even the basic process of advertising to children has come under scrutiny. Because of changing demographics and the fact that families are now having fewer children than before, organisations
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are forced to increase their advertising spend per child in order to generate revenues. Kids are also becoming more advertising literate and so advertisers have to work harder to reach them. Moreover, the increasing incidence of working parents, and weekend parenting (due to separation and divorce) makes parents feel guilty, a guilt they often try to appease through consumption. There are also claims that much marketing subverts parental authority (Triese et al. 1994). The typical response in this situation is to limit or ban advertising directed specifically at children and many countries have taken such a step. The difficulty is that such a response can also have the effect of increasing toy prices as organisations try to protect the bottom line. Furthermore, advertising helps to pay for editorial content and, therefore, by reducing advertising to children the money available to television producers to make positive children's programming is reduced. Other ethical concerns centre on the marketing of certain products including alcohol, tobacco and pesticides. Many companies argue that when these products were originally launched/marketed, they were unaware of the potential problems associated with them. While this may be true, there have been several scandals where products have been promoted and marketed in developing countries despite being aware of problems or indeed, despite the product being banned in its original market. This occurs because the regulatory systems are not sophisticated enough in developing countries. For example, pesticides deemed too harmful for sale in the USA, are often freely available in developing countries (Wicks et al. 2010). So, a big question that often faces an organisation is not whether something is legal or not, but whether it is ethical or not. This is an important distinction and one that you should be wary of as you make decisions in your organisation. Although most of us believe that marketing has little power over us as individuals, we are increasingly recognising that marketing has a powerful impact in shaping culture. In this regard, then, marketing must have an impact ­ why else would organisations spend so much on advertising, packaging, branding etc. Fundamentally, then, marketing is a powerful and potent tool. Used wisely it can help to align organisations' interests with those of their customers and, by extension, the interests of society as a whole. If used recklessly, marketing can cause harm by abrogating its social responsibilities for short-term corporate interests (Sheth and Sisodia, 2005). Organisations may choose to ignore the ethical and social issues that have been raised as a result of marketing activities. This has worked to some extent in the past, as organisations dismissed criticism on the basis that it was being voiced by very few (though loud) protagonists. This approach is increasingly problematic because it is clearly more than just a few cranks who are critiquing marketing. In the recent past there have been a number of organisations who have been publicised in a negative light for their contribution to society. A prime example is the case of Nike who, by the 1980s had been heavily criticised for their labour practices, particularly in the East. Among their apparent misdemeanors were underpaying workers in Indonesia, child labour in Cambodia and Pakistan, and poor working conditions in China and Vietnam (Locke 2002). Indeed, there were even rumours that Nike were paying MIchael Jordan more each year to endorse their products that then were paying their entire Asian workforce. In 1992, Nike set up a Code of Conduct on labour and environmental practices for its network of suppliers (O'Rourke 2003) and in 1996 established its Labour Practices department. Nonetheless, doubts were still expressed as many believed that the code of conduct didn't go far enough and was not fully enforced (Locke 2002). In recent years the company has taken even more strident steps to improve its tarnished image. Companies such as McDonald's
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have also been charged with claims of encouraging obesity. On a broader scale, it is claimed that food adverts often encourage consumers to have a dysfunctional relationship with food, such as a past campaign for Haagen Dazs ice creams "dedicated to pleasure". Obesity is a huge social problem in modern society and food advertising can contribute to the creation of an addictive mindset, according to Kilbourne (2000). She argues that many food adverts normalise and glamorise harmful attitudes toward food and eating. It can contribute to a belief in a quick-fix and instant gratification, an escape. Within the marketing discipline there are numerous journals dedicated to considering the impact of marketing on society, engaging with Business Ethics and Corporate Social Responsibility. There is a strong business case too, with large numbers of customers prepared to factor ethical issues into their decision making processes. So, business needs to engage with social and ethical issues and they need to be seen to do so.
Marketing in Society: Some Challenges Let's look in a little more detail at what the problem(s) appear to be. RESEARCH PAPERs and articles that critique marketing may talk about the impact of marketing on society or may use the term `macro marketing'. Macro means big picture. Essentially, we are asked not to consider the impact of marketing on me or on you ­ but on society as a whole. By adopting this broader approach we see that concerns are increasing about the impact of marketing on the environment. Over-consumption, unnecessary packaging, promoting a `throw-away' culture all foreground the need to deal with environmental and `green' issues ­ particularly in developing countries. There is also a need to consider business practices and to develop and promote responsible practices. Given that the contemporary policy and media environment is strongly influenced by public opinion, demonstration of social responsibility is now regarded as an integral element of corporate strategy (McCombs, 2002). Within this climate, companies that shirk their social responsibility (e.g. by sourcing their raw materials from suppliers using child labour) leave themselves open to negative media attention and even consumer boycotts. The appropriateness of marketing in an age of environmental deterioration, resource shortages, world hunger, poverty, and neglected Social Services has been seriously questioned. And now the wheel is turning as we see numerous firms commendably satisfying individual consumer demands, acting in the long-term interests of the consumer and society, and still making a healthy profit. This concept is commonly referred to as `Corporate Societal Marketing' which extends the definition of marketing to include the provision of products and services "in a way that preserves or enhances the consumer's and the society's well being" (Bloom and Gundlach 2001:163). Caudill and Murphy (2000) remind us that in the "long-run firms that do not use their power in a way that society considers responsible will lose their customers". Technological advancement and the need for transparency have put pressure on organisations to act in a more ethical and socially acceptable way. At least some sections of the media are all too ready to expose and `out' bad business organisations. There has been a significant rise in the number of documentaries/movies being made exposing bad business practices. Examples include An Inconvenient Truth, Supersize Me and Fast Food Nation.
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Maurice Patterson In addition, the exponential growth in the internet and the use of web 2.0 technologies, raise issues of customer privacy. Regulation has been slow to catch-up given the speed of adoption and regulation varies in different markets, which raises concerns for both organisations and consumers (Caudill & Murphy, 2000). On the other hand the availability and use of these new technologies, allow marketers' to collect and store data on their customers, never thought possible. Using such technology means that organisations can develop `segments of one', where product offerings are customised to individual customer needs. Although this brings many advantages, customer trust and confidence must be valued. Therefore how organisations' use the data they collect on their customers' presents ethical concerns and needs to be carefully managed. For example Facebook has a programme called `Beacon', which allows them to monitor and collect their members' activities on their site and also on partner sites, such as Amazon and Blockbuster. Social Marketing So, as we see above, a great deal of time and attention has been devoted to considering the impact of marketing activities on society. Another strand of research also believes that marketing techniques and tools are inherently powerful and aim to figure out how best to use marketing to `help' society. Social Marketing has extended the concept of marketing beyond a profit making machine and turned it into an alleviator of social problems (Laczniak and Murphy 1993: 241). 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", (Kotler et al. 2002: 5). In this manner the principles of marketing such as planning, pricing, advertising, distribution and research have been used for the good of society. Some examples of social marketing include government campaigns for road safety, pleas for charity donations and healthcare campaigns and fairtrade. Without this form of marketing important information would not be communicated to the right people and many disadvantaged groups in society would be in a far worse position. So marketing can be used to `do good'. There is a strong link between production, consumption and disposal. With increasing concerns regarding more sustainable consumption, de-marketing campaigns have now been introduced to combat unsustainable consumption behaviour. The Truth campaign in the US is one such successful example where, in Florida there was a campaign to reduce tobacco consumption among youths. In recent times there have been growing grassroots movements of consumers who boycott products of organisations they feel that they are acting unethically. So even if organisations are not willing to be proactive, they may be forced to react. For example the Nestle KitKat faced negative publicity from Greenpeace for using palm oil from the destroyed Indonesian Rainforest, threatening the extinction of Orangutans. Facebook, You Tube and Twitter gave consumers themselves a platform to voice their outrage and encourage boycotting of the brand.
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Rights and Responsibilities So far, we have discussed the approaches that organisations can take in adopting ethical marketing strategies and the need to do so. This begs the question as to where rights and responsibilities lie. Are organisations ultimately responsible for their actions or should some lie with the individual consumer? Some argue that marketing only reflects the moral values of society and should not be blamed for consumers' individual rights to make informed decisions (Laczniak and Murphy, 1993). As individuals, do we need to take more responsibility for the choices we make? As we have seen, organisations can choose to engage in responsible business practice because it is the right thing to do ­ whereas others engage because engagement is what the market currently demands. In terms of the latter, companies believe that being ethical and socially responsible will add value and win over conscious consumers, thus creating a competitive advantage. For other organisations, social marketing issues are at the heart of the business. One famous example is entrepreneur and visionary Anita Roddick who built her business, The Body Shop on the philosophy that business is very much part of society. Several other organisations were also founded on such principles including Ecover (see http://www.ecoverwateraid.com) and Innocent Drinks. However, it is important to recognise that such an idealised position may be difficult to achieve and maintain for organisations. Indeed, many such enterprises have found themselves open to takeover and mergers as large firms seek to enhance their `green portfolios'; for example, Green & Black's chocolate was bought out by Cadbury, the Body Shop was bought by L'Oreal, and Coca Cola took control of Innocent Drinks. Businesses are social actors and wield power and influence in society. Many organisations have incorporated CSR (corporate social responsibility) policies into their corporate strategy. Contributing positively to society can bring direct benefits to the organisation. Sustainability issues bring a heightened awareness of effects of doing business has on the environment. For example, global warming, carbon footprint, diminishing resources. There are lots of different levels CSR polices that organisation's can adopt, from engaging in local sports, charities to larger sponsorship and environmental or political activities. This is the most established way that organisations can communicate value to consumers and stakeholders. We have discussed many converging issues that are forcing organisations' to act more ethical, Changing consumer mindsets, the availability and access to media and information technology and the growing number of social problems in society. There have been different approaches taken by organisations; some have done nothing, some have had to react to ethical concerns and others have made ethical marketing part of their philosophy. Either way, there is a market demand for organisations to act more responsibly or we have discussed the reasons for doing so.
References Ackerman, R. (1973) "How Companies Respond to Social Demands", Harvard University Review, 51(4), 88­98. Bloom, P. and G. Gundlach (2001) Handbook of Marketing and Society, London: Sage.
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Caudill, E. and P. Murphy (2000) "Consumer Online Privacy: Legal and Ethical Issues", Journal of public policy and Marketing, 19(1), 7-19. Crane, A. and D. Matten (2004) Business Ethics, London: Oxford University Press. Handy, C. (2002) "What is Business For', Harvard Business Review, December, 1­8. Kilbourne, J., (2000) Can't Buy My Love: How Advertising Changes the Way We Think and Feel, Touchstone Publications. Kotler, P., N. Roberto and N. Lee (2002) Social Marketing: Improving the Quality of Life (2nd ed.), London: Sage. Laczniak, G., R. Burton and P. Murphy (1999) "Sport Marketing Ethics in Today's Marketplace", Sport Marketing Quarterly, 8, 43­53. Laczniak, G. and P. Murphy (1993) Ethical Marketing Decisions: The Higher Road, London: Allyn and Bacon. Locke, R. (2002) "The Promise and Perils of Globalisation: The Case of NIke", Industrial Performance Centre, MIT Working Paper Series. McCombs, M. (2002) "The Agenda-setting Role of the mass media in the Shaping of Public Opinion", Mass Media Economics Conference, London: London School of Economics. O'Rourke, D. (2003) "Outsourcing Regulation: Analysing Nongovernmental Systems of Labour Standards and Monitoring", The POlicy Studies Journal, 31(1), 1-29. Peattie, K. and S. Peattie (2008) "Social Marketing: A Pathway to Consumption Reduction", Journal of Business Research, January, 1-9. Sheth, J. and R. Sisodia (2005) "A Dangerous Divergence: Marketing and Society", Journal of Public Policy and Marketing, 24(1), 160-162. Wicks, A., R. Freeman, P. Werhane and K Martin (2010) Business Ethics: A Managerial Approach, London: Prentice Hall. Wilkie, W. and E. Moore (2003) "Scholarly Research in Marketing: Exploring the "4 Eras" of Thought Development", Journal of Public Policy and Development, 22(2), 116-146.
Recommended Reading Baines, P., C. Fill and K. Page (2011) Marketing (2nd ed.), Oxford: Oxford University Press, Chapter 19.
Blann, F.W. and K. Armstrong "Sport Marketing" in J. Parks et al. (2007) Contemporary Sport
Management,
Leeds:
Human
Kinetics,
193-218,
available
at
www.ithaca.edu/faculty/wblann/spt_mkt_grad/documents/ParksCh9%20193-218.pdf
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Maurice Patterson DeSensi, J. and D. Rosenberg (2003) Ethics and Morality in Sport Management, Morgantown, WV: Fitness Information Technology Inc. Laczniak, G., R. Burton and P. Murphy (1999) "Sport Marketing Ethics in Today's Marketplace", Sport Marketing Quarterly, 8, 43­53. Lazer, W. (1969) "Marketing's Changing social relationships", Journal of Marketing, 33(1), pp. 3-9.
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