Ethical Issues in Marketing - Business Ethics

What is Ethical Issues in Marketing?

Ethical issues in marketing arise from the clashes and lack of contract on specific issues. Parties involved in marketing dealings have a set of beliefs about how the business relationships will take shape and how numerous transactions need to be lead. Each marketing concept has its own ethical issues, which we will talk over in this section.

Emerging Ethical Problems in Market Research

Market research has skilled a recovery with the widespread use of the Internet and the attractiveness of social networking. It is easier than ever before for companies to connect openly with customers and collect separate information that goes into a computer database to be matched with other pieces of data collected during unrelated transactions.

The way a company conducts its market research these days can have serious ethical consequences, touching the lives of clients in ways that have yet to be fully understood. Additionally, companies can be faced with a public backlash if their market research practices are perceived as unethical.

Grouping the Market Audience

Unethical follows in marketing can result in grouping the audience into numerous segments. Selective marketing may be used to disappoint the demand arising from these so-called unwanted market segments or to disenfranchise them totally.

Instances of unethical market exclusion may comprise the industry attitudes towards the gay, ethnic minority, and plus-size groups.

Ethics in Advertising and Promotion

In the early days of presence of companies, particularly during 1940s and 1950s, tobacco was promoted as a substance that promotes health. Of late, a promoter who does not meet the ethical standards is measured an offender against morality by the law.

  • Sexuality is a major point of debate when ethical issues in publicity content are considered. Violence is also an important ethical issue in advertising, particularly where children should not be pretentious by the content.
  • Some select types of advertising may powerfully offend some groups of people even when they are of strong interest to others. Female cleanliness products as well as hemorrhoid and constipation medication are good examples. The advertisements of condoms are significant in the interest of AIDS-prevention, but are occasionally seen by some as a method of helping promiscuity that is undesirable and strongly condemned in various societies.
  • A negative advertising policy lets the advertiser highlight numerous disadvantages of the contestants’ products rather than showing the inherent advantages of their own products or services. Such policies are rampant in political advertising.

Delivery Channels

Direct marketing is one of the most provocative methods of advertising channels, particularly when the methods included are unwelcome.
Some mutual instances include TV and Telephonic commercials and the direct mail. Electronic spam and telemarketing also push the limits of ethical standards and legality in a strong manner.

Example − Shills and astroturfers are the best instances of ways for bringing a marketing message under the appearance of independent product reviews and authorizations, or creating allegedly independent watchdog or review organizations. Fake reviews can be published on Amazon. Shills are primarily for message-delivery, but they can also be used to drive up prices in auctions, such as EBay auctions.
Deceptive Marketing Policies and Ethics

Deceptive marketing policies are not limited in a exact limit or to one target market, and it can occasionally go unseen by the public. There are several methods of deceptive marketing. It can be obtainable to consumers in numerous forms; one of the methods is one that is talented via the use of humor. Humor offers an escape or relief from numerous types of human constraints, and some advertisers may take the advantage of this by applying misleading advertising methods for a product that can possibly damage or improve the constraints using humor.

Anti-Competitive Practices

There are numerous methods that are anti-competitive. For instance, bait and switch is a kind of fraud where customers are "attracted" through the ads for some products or services that have a low price; though, the customers find in realism that the advertised good is unavailable and they are "switched" towards a product that is higher and was not intended in the advertisements.

Added type of anti-competitive policy is planned obsolescence. It is a technique of designing a particular product having a limited useful life. It will become non-functional or out of fashion after a assured period and thereby lets the consumer to purchase another product again.

A pyramid scheme is also an anti-competitive process. It is a non-sustainable business model that abilities the participants payment or services, primarily for registering other people into the scheme; it does not stock any real investment or sell products or services to the public.

This business practice demands the initial depositor or the "captain" to enroll other people for a fee to them who again will further enroll more people in order to be paid by the company.

Pricing Ethics

There are numerous forms of unethical business practices connected to pricing the products and services.

Bid rigging is a type of fraud in which a commercial contract is promised to one party; though, for the sake of advent several other parties also present a bid.

Predatory pricing is the practice of sale of a product or service at a negligible price, meaning to throw participants out of the market, or to create barriers to entry.

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