Ethics in Marketing

 In Perspective, Thought Leadership

Written by: Professor Laurie Busuttil, CPM

When Max De Pree was CEO of the Herman Miller furniture company, he posed several questions for discussion at an executive leadership retreat. Two of these were, “What is the purpose of business?” and “Is there a moral imperative to good design?”.[1]  They are good questions for marketers to consider, too.

The Purpose of Marketing

The question about the purpose of marketing could have a variety of answers. Is it to serve our customers and to help them flourish? Is it to advertise products or services—or does it begin with developing those products and services? Do we convince target audiences to buy products that meet wants and needs created by us, or do we develop products our customers truly need? Regardless of how we answer these questions, the marketer’s prime obligation is to act ethically.

Marketing is the exchange of one thing of value for another: products and services for money. Honestly depicting the value proposition, making brand promises that we can keep, and taking a long-term view of customer relationships should facilitate valuable exchanges, which are at the heart of successful marketing.

The Practice of Marketing

De Pree’s second question prompts discussion about a moral imperative in marketing. This is the ethics of marketing practice. Gary Karns suggests that deceptive advertising and persuasive practices result in one-sided gains, and exploitative and unjust relationships.[2] Such practices also result in the loss of trust in marketers and in the brands they promote.

The 2020 Edelman Trust Barometer report identified two dimensions of trust: ethics and competence. Sadly, none of the four institutions Edelman studied (business, government, media, and non-governmental organizations) were perceived as being both ethical and competent. Business ranked highest in competence, yet it was still seen as being unethical.[3]

Marketers can help change those perceptions. We can change the way organizations and brands are perceived by customers. This will build stronger consumer relationships, develop advocates for the brand, and enhance profitability. Developing trust is foundational to a brand’s—and a marketer’s—success.

Trust is established and strengthened when we listen and tell the truth. This was abundantly clear in 2008 when Michael McCain, CEO of Maple Leaf Foods, released a one-minute and six-second television spot, expressing a heartfelt apology to those who had been sickened, and to the families of those who had lost their lives because of a listeriosis outbreak at one of their meat processing plants. The share price of the company dropped drastically on news of the outbreak, yet four months after McCain’s apology and commitment to improve safety practices, Maple Leaf Foods’ shares were trading above the price at the time of the outbreak. Honesty matters and it has a direct impact on the value created by the firm.

While the practice of marketing is shaped by the ethics of marketers, words are not enough. Customers expect action. The 2020 Edelman Trust Barometer released a special report on brand trust in which survey respondents indicated they “wanted brands to take action, solve problems, and advocate for change.”[4] Yet, as the survey also discovered, nearly 70% of people avoid advertising, a fundamental avenue of communication for marketers. Consequently, ethical practices must influence other marketing practices.

For example, engaging in sustainable product development and conservation of resources has practical implications for product design and development. Taking a cradle-to-cradle rather than a cradle-to-grave approach means that marketers care for the environment and do not waste resources.  Transparency and consistency in our pricing and distribution practices are additional ways to restore trust in businesses, especially when traditional avenues of communication (advertisements) are being removed.

Putting customers at the centre of our practice means we put ourselves in their shoes. Treating others as we want to be treated should lead us to intentionally structure our marketing activities in ways that do not create “built-in disadvantages to any individual or group of people.”[5]

 The Future of Marketing

As a marketing educator, I am excited about the future. Every day I work with young people who are planning their future as marketers. They recognize the need for honesty, transparency, accountability, trust—and the ethical foundation that will be required to establish successful careers as valued partners at the business table. The moral imperative is being envisioned.

In class, we discuss case studies, real situations around which students can wrap theory, concretize concepts, and apply them to situations with which they may already be familiar or which they will encounter in the future. We discuss ethical issues from the perspective of all stakeholders. For instance, sometimes the discussions centre on our role as consumers and the ethics of consumption, preparing them to think about the customer as they design, develop, and promote products and services. We tackle discussions about developing products that are not “needed” by consumers but drive spikes in sales. On other occasions, we discuss advertisements that push the envelope and cross moral lines. We reimagine promoting such products in clever and creative ways, rather than in crass or offensive ones.

Of one thing I am convinced: the future of marketing will be bright if we take time to model ethical marketing practices and intentionally prepare young marketers to enter the industry

 

References

[1] Wolterstorff, N. (2004). Educating for Shalom: Essays on Christian Higher Education. C.W. Joldersma and G. Stronks, (Eds). Grand Rapids, MI: Eerdmans, 2004.

[2] Karns, G. L. (2008). A Theological Reflection on Exchange and Marketing: An Extension of the Proposition That the Purpose of Business is to Serve. Christian Scholar’s Review, 37(1), 97-114.

[3] 2020 Edelman Trust Barometer. https://www.edelman.com/trust/2020-trust-barometer

[4] Edelman Trust Barometer Special Report: Brand Trust. (2020) https://www.edelman.com/news-awards/brand-trust-2020-press-release.

[5] Chewning, R. C., Eby, J. W., and Roels, S. J. (1990). Business Through the Eyes of Faith. New York, NY: HarperCollins.

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