Ethical Issues in Marketing

TABLE OF CONTENT S. NO Particulars Page no 1. executive director SUMMARY 5 2. INTRODUCTIONETHICAL ISSUES IN trade 6 3. FAMOUS CASES(UNETHICAL MARKETING PRACTICES) 9 4. PRIMARY STUDY 12 5. REPRESENTATION OF DATA 13 6. INTERPRETETION 23 7. RECCOMENDATION 24 EXECUTIVE SUMMARY This report out get outs the concept of deterrent examples in trade and the noned causal agencys that establish emerged in the past regarding wrong marketing practices by line of des centimees. hrough this report we perk up overly tried to encounter out how sensitive argon the common masses to the thin out of moral philosophy in publicizings and how do they perceive the contents shown in the advertisements nowdays. For this purpose we had conducted a stand for over amonga sample of 50 students of age group 20 to 24 yrs. The research tool used in the study was that of a questionnaire. The study reveals that speckle near of the people be sensitive to the love of un estimable adverti sements, there ar similarly a few who believe that nada much can be adopte in this respect and ar a little ignorant towards such issues.They pack been and go forth widen purchasing a stigma even after perceiving its advertisement as wrong. Our recommendations to the companies that deal in such practices is that they should thrive to stick to their morals and moral value and instead should concentrate on providing their customers with such functions and reapings that will add value to them and their lives. MARKETING AND ETHICS Marketing diligence is a really broad industry and also one of the core barter functions that e very(prenominal) line of credit enterprise practices in order to effectively render to the needs of the customers. arketing leaders thrive to create the look and experience of a brand and to make strategies to invade and inform customers about the alike. for this purpose the marketers ar today using print ,electronic and amicable media as their vehicles,as these mediums are permeant and their powerful forces shape attitudes and behavior in todays world. The reason for this is the tremendous harvest-feast and development in the field of Information and Communication technologies.If yesterday it was television receiver that revolutionized the way advertisements could create a lasting impact on the consumer, whence today the internet and phone text messages are doing just the resembling. also , Rapid economic expansions in countries like China and India have meant that marketers have to quickly respond to the changing socio-economic scenarios. But at the same sequence these developments have awardn rise to a number of ethical issues. the world is indeed becoming a smaller place precisely the marketers have to bear in mind national, local and cultural sensitivities.Very often, in the hope of capturing a large share , marketers jump in saucy markets without keeping in mind ethnic and social issues associated to certa in areas. marketers today ignore and exploit the social sen whilents and factors of the customer groups ,in order to maximise their kale and make fast bucks. this leads them to engage in unethical marketing practices. unethical marketing decisions can be made in following marketing areas * Supply drawstring * Advertising * Pricing * Product Supply chain Only being an ethical caller-out is not sufficient.These days, leading brands are judged by the partnership they keep. Consumers, investors, business partners, regulators, and media organizations now expect a community and its entire bestow chain to be ethical. every social club is a part of a supply chain since almost every conjunction taints unfinished in contrives provided by m any separate companies before refining them and laissez passer the finished goods to the consumers. Supply-chain management is a strategic issue. It has an effect on a partnerships brand and it now concerns managers and board members. Excellen t companies are the most ethical in their practices .Excellent companies lead on best practices. A business is said to be having an unethical supply chain if any of the elements of its supply chain ie suppliers/contractors/distributers/sales agents are practising unethical practices like, use of shaver labour or forced labour, mathematical returnion in sweatshops, violation of elemental rights of workers, ignoring wellness safety and environmental standards. Advertising Advertising is the most master(prenominal) tool for marketers to produce their carrefours and to make the consumers aware about the same.Advertisements play an definitive role in inclining and attracting the potential customers towards the intersection. further nowdays advertisements are nether scrutiny for being unethical. unethical advertisements include misleading advertisements that make untrue claims, obscene /offensive and indecent ads that hurt religious or social sentiments of people. To sum up, ne arly of the ethical issues in advertising are nubbiness/obscenity Misleading advertisements and deception Puffery Stereotype Racial issuesFeature of Unethical advertisement on television has been a hot issue in the past days in our country,with the Advertising Standard Council of India receiving 777 complaints regarding 190 ads. it has been discussed later(prenominal) in the project and also a primary study has been conducted regarding the ethics in advertisements in our project. Pricing Pricing is a very of the essence(p) part of marketing mix and is a decision of strategic nature. a familiarity has to do sufficient amount of analysis to decide on the priceof its harvesting. ompanies can sometime deal in unethical and even contraband pricing. Unethical 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. This might also include making incorrect price comparisons, providing misleading s uggested selling prices, omitting important conditions of the sale, or making very low price offers available only when another(prenominal) items are obtaind as well. other unethical pricing stratgies include price discrimination,price skimming,price fixing.Product several(prenominal) product-related issues raise questions about ethics in marketing, most often concerning the woodland 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 fosterd, 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 genius for poor products or service.False or greatly exaggerated product or service claims are also deceptive. When packages are intentionally illegal as to contents, size, weight, or use information, that co nstitutes deceptive packaging. Selling hazardous or defective products without disclosing the dangers, failing to perform promised services, and not honoring warranty obligations are also interpreted deception. Other product related issues include animal interrogation and manufacturing products that harm the ecology and environment and exploit the already scarce inherent resources. FAMOUS CASESLOREAL (UNETHICAL ADVERTISEMENT AND PROMOTION STRATEGY) Loreal is amongst the biggest brand call in personalised care and beauty products in the world with a huge line of products and brands under its umbrella , operational in over 130 countries most the world. However this company has been in news recently ,but for wrong reasons. The company has been time and again been incriminate of airbrushing its models in order to make them look fairer. The in vogue(p) addition in its line of controversies is its advertisement that features indian origin actress Freida Pinto.This ad has created c ontroversies because of the fact that the actress appears to be airbrushed as her skin tone has been lightened . Earlier same controversy of airbrushing happenend when singer Beyonce featured in one of Loreals ad. The company is seemingly promoting fair skin tones as compared to dark skin tones and is inculcating a sense of insecurity amongst women around the world with regard to their complexion. another case of Loreals criticism over fakery in its advertising is of year 2007. the company was condemned for producing misleading mascara adverts featuring Penelope Cruz.The TV and magazine advertisements claimed that women could have up to 60 per cent doggeder eyelashes with its Telescopic mascara. But actually it was later revealed that Cruz was wearing simulated eyelashes in the ads for Telescopic, and the company was forced to include disclaimers during its advertisements making such issues clear. It is for these reasons that the company is incertain(p)ed by activists as the face of modern consumerism a company that well-tried its cosmetics on animals, exploited the sexuality of women, and sold their products by making women feel insecure.Moreover, Nestle owned 26 percent of LOreal. Nestle was one of the most boycotted companies in the world for its alleged unethical business practices and aggressive forwarding of baby take out in developing countries as discussed above. NIKE AND APPLE INC. (UNETHICAL proviso CHAIN PRACTICE) Nike has been accused of having a history of usingsweatshops, a sweatshop is a working environment or manufacturing centre where the working environment is considered to be dangerous and difficult because workers can be exposed to hazardous materials, ruinous situations, extreme temperatures, and abuse from employers.Sweatshopworkers often work long days, sometimes exceed 14 hours, and earn pay far below a maintenance age. In 1990s ,Nikes suppliers in developing countries like indonesia, chinaware and vietnam operated sweatshops in which the workers were made to work in hazardous conditions with minimal wages. this case is an idol example of unethical supply chain in marketing. a brand as big and famous as Nike has been associated with unethical execute in this particular field of marketing. It was unbelievable and shocking on part of the people who were its loyal customers.The company initially denied all such accusitions and then in the year 2001 a very irresponsible statement was made by Nike director Tom McKean submiting that the company cannot control what goes on around the world as they do not own these factories. Another famous company involved in a similar unethical practise is Apple Inc. in the year 2010 ,one of Apples suppliers in china was accused of using barbarian labor. since companies are under immense haul to find lowest cost providers ,they end up dealing with suppliers in developing countries like china ,where such unethical practises are common. o this Steve Jobs (Apple head) said that this was not merely Apples problem but a world problem with regard to priorities and a lack of enforcement by local agencies in various deneloping nations. Too many companies are bout blind eye towards their suppliers and end up being associated with unethical business practices. May be this is the reason why Apple ,one of the most word-painting conscious and credible company could not turn tail this trap. NESTLE (UNETHICAL AND vicious PRODUCT ) Nestle a big name in FMCG industry ,has been involved in numerous unethical marketing practices.This company was extremely criticed for its disregard for the health of infants shown by its irresponsible marketing of breast milk substitutes. it had been continously breaching the WHO code regulating the marketing of breast milk substitutes. it encouraged store feeding and carried on promotional and advertising activities for its baby foods by fine-looking away free samples of baby milk to hospitals . also the company was accused of misinforming mothers and healthworkers during its promotions.It stated that malnourished mothers and mothers of twins and premature babies were unable to breastfeed ,despite health organisations claimimg that threre was no evidence to support such theory. Nestle advertised straightaway to mothers in over twenty countries such as thailand and south africa. alike the baby foods/milk product were sold in the market without any health warning and even instuctions on the packaging an if open they were in an inappropriate language. Thus company violated the code regulating the marketing of baby milk formulas.According to WHO bottle fed babies are up to ten times more likely to develop gastro intestinal infections. therefrom this company till date is upliftedly criticised for its unethical practice of vile marketing and promotion of an unethical product. Other accusitions of the company include using of workers at its Brazil chocolate plant including dicrimination of women workers and supporting brutal and inhibitory regimes MICROSOFT (PRODUCT BUNDLING CASE) Microsoft is a large diversified computer software manufacturer with one of the highest valuations in the world.Microsoft produces the Windows family of operational systems for personal computers and servers. It also produces applications software that channelise on the Windows family of operating systems, most notably the very successful MS- stance Suite. Almost all Microsoft products are complementary to a member of the Windows family of operating systems for personal computers and servers. United states Vs Microsoft was a civil action filed against Microsoft Corporation by United States Department Of Justice(DOJ).The allegation on Microsoft was that it abusedmonopolypower on Intel-based personal computers. The issue central to the case was that whether Microsoft should bundle its Internet adventurer web browser software with its Microsoft Windows Operating System. Bundling IE with the operating s ystem was considered as a victory of Microsoft in the browsers war as all the Windows users had a copy of IE which had started restricting the sales of the other web browsers such as Netscape Navigator and Opera which were slow to download or had to b purchased at a store.Microsoft said that the bundling of IE with Windows was an innovation and the result of competiton and that now both were a same product. The underground said that IE should not b bundled with Windows as a separate version of IE was available for Mac OS. They also countered that IE was actually not free with Windows as its development and marketing costs essential have change magnitude the price of Windows than what it might actually have been. This had put up a question that whether Microsoft was unethical in bundling its product or was it an innovation. Was it right to increase the sales by almost filet the sales of others?The strategy which Microsoft adopted was not ethical as the others were wo(e) because o f this and had no choice left before them. Hence what Microsoft did was against the ethics of the marketplace. question STUDY (ADVERTISEMENTS AND ETHICS) In this project we have attempted to conduct a research concerning the publics opinion about the direct of ethics in advertising. done and through this study we want to address the problem of the level of ethics in advertisements nowadays and what is the peoples outcome and how sensitive they are towards the issue of ethics in advertising.For the purpose of this study, questionnaires were distributed to a sample of 50 students and were asked to guard their honest opinion regarding this issue. DATA REPRESENTATION Q. Do Advertisement shows an accurate view of existence? Here , 15 people strongly dissent with the situation that advertisement shows exact reality and 10 people are strongly agreeing and 10 are disagreeing with the situation which shows that every individual is having contrasting opinion according to their think ing. Q. Do you think superior general television advertisements promote philistinism?In this out of 50 respondents , 27 respondents think that advertisements promote materialism while other 22 people think they dont Q. How do you view the level of ethics in general advertising? Q. Which off the following issues in general advertising would you consider being unethical ? A relatively mixed reaction is find in this answer. while majority believed that they perceived lack of trust issue in advertisement as unethical. A good lot also believed that advertisements of cigrattes and dry beverages were also unethical. Q.Mention a brand name in straw man of the product categories mention below ? Q Would you palliate buy the same brand of shoes if that company is dealing in wrong practices ? For e. g. child labor 43 of sample respondents said that they will not purchase a particular brand having known that the brand deals in unethical practise. Q. Have you ever decided not to buy a produ ct or a service due to an advertisement that you perceived as unethical? 19 respondents said they have not purchased a product having perceived its advertisement as unethical while the majority move purchasing .Q . Is it fine to use unethical practices to increase profitability of the company? Almost all the respondents believe that it is not right for business houses to engage in unethical practices to maximise their profits. INTERPRETETION AND CONCLUSION The survey done through the distribution of questionnaires revealed following facts The students interviewed believe that advertisements today have a very unreal appeal to them and do not promote reality while there are a few who also believe that advertisements present a true picture of the real world.The students also believe that advertisements do promote materialism but there was a mixed reaction when asked whether such promotion is ethical. However majority of the people failed to justify their answer and give valid reasons for the same. A huge number of them also think that advertisements do not promote materialism. Also peoples view regarding the level of ethics in the general advertisements was very generalised, for them ethcal level in advertisements is neither too high nor too low.As far as unethical advertisements are concerned, for a majority lot, advertisements which lack trust quotient and are highly exaggerated and misleading are the most unethical. While for others, advertisements promoting cigarettes and alcoholic beverages are also unethical . When asked to name a brand that extend to their minds instantaneously corosponding to the products shoes,deodorant,fainess cream and lively phone, people had different brand names in their minds as their favourites (most of them being big names).In continuation of this question, respondents were asked if they would still purchase the same brand if they discovered that the brand was associated with unethical practices. To this their answer was pre dictable as most of them refused while a few were not sure. Majority of the respondents have responded that they have decided not to buy a product ,if they have perceived its advertisement as unethical . this shows that a lot of people are sensitive to such issues and have express threir dissatisfaction by discontinuing their purchase.While some of the respondents were ignorant and continued purchase. On the other hand most of the respondents believe that it is not right for companies to compromise on their ethical values in order to achieve high profits. RECOMMENDATIONS Considering the high level of unethical issues that are emerging everyday, businesses need to realise that they have to find an alternate to unethical practices. They need to realise that unfair practicse whitethorn help them earn profits faster,but the profitability would not last for long .The consumers today are becoming highly aware and such issues cannot escape their knowledge. Thus it is better if companies s hould strive for using ethical marketing practices . they should boil down on providing good products with lots of benefits, and in this way they will be able to make their marketing honest and irresistible for the customers. They shoiuld make sure there is invariably an exchange of value between two parties with their marketing efforts. Business houses should keep in mind that business tactics should always be ethical. hey should be persuading a person to buy a product because they really need it, and when the companies are certain that this product will beget value into their lives. Ethical business practice is the ability to truly give somebody the power of choice, and not forcefully loading a product onto the customers, which they know in the back of their minds they will never have any use for. QUESTIONNAIRE NAME- AGE- Q1) Advertisement shows an accurate view of reality? a) Strongly agree b) Agree c) Disagree d) Strongly disagree ) No opinion Q2) Do you think general televis ion advertisements promote materialism? a) yes b) No c) Cant say Q3) if yes, do you perceive it as ethical or unethical and why? Q4) How do you view the level of ethics in general advertising? a) Very high b) utmost c) Average d) low e) Very low Q5) Which off the following issues in general advertising would you consider being unethical ? a) creation of stupid desires , and needs b) comparative advertisement c) advertisement with lack of truth d) puffery ( increased value or attributes) e) alcoholic beverage advertisement ) cigarette and baccy advertisement Q6) Mention a brand name in front of the product categories mention below ? a) shoes b) fairness cream c) deodrant d) mobile phone Q7) Would you still buy the same brand of shoes if that company is dealing in wrong practices ? for e. g child labour a) yes b) no c) cant say Q8) Have you ever decided not to buy a product or a service due to an advertisement that you perceived as unethical? a) yes b) no Q 9) Is it fine to use une thical practices to increase profitability of the company ? a) Yes b) No c) Cant say