Ethics of Marketing - Research Paper Example

Ethics of Marketing Introduction Ethics refer to moral principles and values which govern an individual’s or group’s actions and decisions. These act as guidelines on appropriate action in a situation of moral dilemma. The American Marketing Association, AMA (2013) has several of such ethical norms that guide marketers in their relationship with stakeholders including customers, regulators, host communities and employees among others. Laczniak (2008) defines ethics of marketing as a systematic study on the application of moral standards to marketing institutions, behaviors and decisions.

It articulates the code of ethics in various marketing functions, with this paper seeking to articulate ethics in marketing as concerns market segmentation, marketing research, product management, pricing, distribution, advertising and personal selling. Ethics in marketing arises when there exists a feeling that an action by a marketer could be judged as morally inappropriate, but it must be observed for the success of any organization. In market segmentation, marketers face the dilemma of promotions among children, a market segment they cannot ignore based on the potential it poses: Pride and Ferrell (2013) indicate that in the US, this market segment presents an over $25 billion market.

For the older ones, the concern would be in the content of certain products like video games or the degree to which such children could be susceptible to provocative fashion. This dilemma also extends to the older consumers in their 80s and above, whose decision making capabilities would be considered as unstable. As such, marketing to them could be unethical due to their vulnerability to fraudulent sales of vacation packages, financial services and similar products. Marketing researchers have been noted to be more professional in their execution of duties due to considerable training they receive on statistical and methodological techniques (Laczniak, 2008).

The code of conduct that various marketing research professional organizations advocate for uphold the need to protect the confidentiality of respondents, appropriate disclosure of research procedures and non-misrepresentation of research sponsors among others. Additionally, ethical issues could arise due to constant contact with the general public. This arouses issues on consumer privacy and profit motive. Product management ethics concerns the ethical issues concerning products as products stand out as central to marketing.

Commonly, the concern here would be on the safety of the products. AMA (2013) brings this to perspective through its code of ethics against knowingly doing harm. This informs the institution of the US Consumer Product Safety Commission to oversee the safety of consumer products. Product counterfeiting, defined by Laczniak (2008) as unauthorized copying of patented inventions, trademarks and products or violating registered copyrights, remains a key concern in product management ethics. This has been estimated to cost American companies over $450 billion annually in sales.

The attempt to take advantage of the goodwill already created by another brand or company in the market makes the practice unethical. Finally, products interfering with the environment have also been a source of major ethical concern in marketing. Non-biodegradable products for instance pose greater risks to the environment hence the unethical consideration in marketing such products. Pride and Ferrell (2013) consider pricing as one of the most challenging managerial activities. Pricing decisions would normally be influenced by a confluence of cost, demand and competition.

For instance, in case of high demand, marketers could be tempted to price-gouge. On the other hand, while seeking to gain greater market share, they could employ predatory pricing. According to Laczniak (2008), there exist considerable regulations that aid in the establishment of minimum behaviors that ensure fair pricing. Other common marketing functions concerned with ethical issues include distribution, advertising and personal selling. With distribution following the process from manufacturer to consumer, there exist various economic interactions that open up chances for occurrence of ethical issues.

Laczniak (2008) observes that there would be an organization in the channel having a greater economic leverage than all the others, hence the potential of ethical abuse. For example, due to the economic power of Wal-Mart, its suppliers would be subdued to its demands so as to penetrate the market. The need to balance between producing informative and persuasive advertisements often lead to biased, intrusive, needlessly provocative and often offensive advertisements. In personal selling, marketers face challenges in trying to balance between the buyer they intend to serve and the represented seller when recruiting sales persons.

Conclusion Marketing actions that violate the law are unethical. However, marketing ethics would focus on those marketing activities that have not been prohibited by law, but those that should not be executed due to moral considerations. The areas in marketing that provoke ethical dilemmas include pricing, marketing research, market segmentation, product development, advertising, distribution and personal selling. Ultimately, ethical considerations have economic costs that need to be considered.

As such, despite the difficulties in making some decisions in marketing, marketers should strive to observe ethical considerations so as to ensure the success of respective organizations. References American Marketing Association (2013). Statement of ethics. Retrieved 22 April 2013 from http://www.marketingpower.com/AboutAMA/Pages/Statement%20of%20Ethics.aspx Laczniak, E. (2008). Ethics of marketing. Sage Publications. In Encyclopedia of Business Ethics and Society (pp. 1336 – 1343). Thousand Oaks, CA: Sage. Pride, W. M.

& Ferrell, O. C. (2013). Foundations of Marketing (5th ed.). Mason, OH: South-Western Cengage Learning.