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MARKETING CHAPTER 3: SUSTAINABLE MARKETING SOCIAL RESPONSIBILITY AND ETHICS

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Sustainable Marketing
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Socially and environmentally responsible marketing that meets the present needs of consumers and businesses while also preserving or enhancing the ability of future generations to meet their needs
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Criticisms of Social Marketing
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• High prices • Deceptive practices: falsely advertising factory or wholesale prices, exaggerating package contents with misleading terms. • High-pressure selling:People buy products which don’t meet a need, leads to damaged customer relationships • Low quality or unsafe products: Products deliver little benefit or are harmful. Results from manufacturer weakness. • Planned obsolescence: making products that will break/rot/rust etc sooner than they should and then making the repair costs close to the items replacement costs to encourage buying a new one. • Poor service: Smaller stores, inferior goods Refusal to open in poor neighborhoods, Irresponsible lending. • “Green” or “pink” washing
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Factors of High Prices
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Cost of 4P’s Materials (product) Mark ups (price) Distribution (place) Advertising (promotion)
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Consequences of Deceptive Practices
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•Legislative penalty from Competition Bureau •Harmful to consumer trust •Not sustainable as brand reputation erodes
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Social Criticisms of Marketing
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• Encouraging materialism • Overselling private goods • Creating cultural pollution • Marketing practices reduce competition by acquisition and shrinking of competitors, create barriers to entry, predatory pricing. Impact on society is alleged to have taken place through a) creating false needs b) encouraging purchase of private rather than public products and c) creating a logjam of messages competing for attention of overwhelmed customers.
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False Wants and Too Much Materialism
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Marketing system urges too much interest in material possessions. People are judged by what they own rather than by who they are.
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Too Few Social Goods
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Business has been accused of overselling private goods at the expense of public goods. A way must be found to restore a balance between private and public goods.
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Consumerism and Environmentalism
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Consumerism: organized movement to improve the rights and power of buyers in relationship sellers Environmentalism: organized movement to protect and improve people’s living
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Cultural Pollution
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our senses are being constantly assaulted by marketing and ads, commercials interrupt serious programs, pages of ads obscure magazines, billboards mar beautiful scenery, spam in email
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Marketing’s Impact on other Businesses
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Can harm other companies and reduce competition through 1. acquisitions of competitors 2. marketing practices that create barriers to entry 3. unfair competitive marketing practices
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Marketing Practices Reduce Competition by
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Acquisition and shrinking of competitors Create barriers to entry Unfair practices such as predatory pricing
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Consumer Activism
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An organized movement of citizens and government agencies to improve the rights and power of buyers in relation to sellers.
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Consumerism
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Organized movement to improve the rights and power of buyers in relation to sellers
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Environmentalism
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Organized movement to protect and improve people’s living environment. • Those who subscribe to environmentalism believe that a marketing system’s goal should be to maximize quality of life
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Marketing Decisions that are called into question under the law include
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Selling Advertising Distribution channels Product Packaging Pricing Competitive relations
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Sellers’ Rights
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• The right to introduce any product in any size and style, provided it is not hazardous to personal health or safety; or, if it is, to include proper warnings and controls • The right to charge any price for the product, provided no discrimination exists among similar kinds of buyers • The right to spend any amount to promote the product, provided it is not defined as unfair competition • The right to use any product message, provided it is not misleading or dishonest in content or execution • The right to use any buying incentive programs, provided they are not unfair or misleading
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Buyers’ Rights
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Not buy a product that is offered for sale Expect the product to be safe Expect the product to perform as claimed
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Consumer Advocates call for more rights to
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• Be well informed about aspects of the product • Be protected from bad products and practices • Influence products to improve “quality of life” • Preserve the world for future generations of consumers
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Evolution of Environmentalism
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• 1960s-1970s: concerned consumers and environmental groups • 1970s-1980s: driven by government, resulting in environmental laws • Firms accepting more responsibility and are adopting environmental sustainability
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Environmental Sustainability
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A management approach that involves developing strategies that both sustain the environment and produce profits for the company.
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Environmental Sustainability Portfolio
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A grid that companies can use to gauge their progress toward environmental sustainaibility. It includes both internal and external “greening” activities that will pay off for the firm and environment in the short run and “beyond greening” activities for longer term.
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Pollution Prevention
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Pollution control, cleaning up waste after it has been created.
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Consumer-Oriented Marketing
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the philosophy of sustainable marketing that holds that the company should view and organize its marketing activities from the consumer’s point of view. All good marketing companies have an all consuming passion for delivering superior value to chosen customers. Marketing activities are viewed and organized from the consumer’s point of view
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Customer-value Marketing
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A principle of sustainable marketing that holds that a company should put most of its resources into customer-value-value building marketing investments. Company resources go toward customer-value-building marketing investments
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Innovative Marketing
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A principle of sustainable marketing that requires that a company seek real product and marketing improvements.
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Sense-of-mission Marketing
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A principle of sustainable marketing that holds that a company should define its mission in broad social terms rather than narrow product terms.
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Societal Marketing
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The idea that an organization should determine the needs, wants, and interests of target markets and deliver the desired satisfaction more effectively and efficently than competitors in way that maintains or improves the consumers’s and society’s well-being.
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Deficient Products
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Products that have neither immediate appeal nor long-term benefits. ie. bad tasting and ineffective medicine
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Pleasing Products
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products that give high immediate satisfaction but may hurt consumers in the long run. ie. Cigarettes and junk food
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Salutary Products
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products that have low immediate appeal but may benefit consumers in the long run. ie. bike helmets
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Desirable Products
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Products that give both high immediate satisfaction and high long-run benefits. ie. tasty and nutritious breakfast food.
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Societal Classification of Products
Societal Classification of Products
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Marketing Ethics
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The cornerstone of sustainable marketing. Principles and standards that define acceptable marketing conduct as determined by various stakeholders.
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Ethics Policies in Marketing
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cover: Distributor relations Advertising standards Customer service Pricing Product development General ethical standards
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2 Principles of marketing ethics formation
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• Free market and legal system is one option • Individual companies and managers to develop a “social conscience”
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PIPEDA
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governs the collection, use and disclosure of personal information in Canada, including employers’ collection and dissemination of personal information about employees
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Code of Ethics and Standards of Practice of the Canadian Marketing Association
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The CMA Code of Ethics and Standards of Practice (the “Code”) is designed to establish and maintain standards for the conduct of marketing in Canada.