LEARNING OBJECTIVES (LO) AFTER READING CHAPTER 4, YOU SHOULD BE ABLE TO:
Explain the differences between legal and ethical behavior in marketing.
Identify factors that influence ethical and unethical marketing decisions.
Describe the different concepts of social responsibility.
Recognize unethical and socially irresponsible consumer behavior.
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McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.Explain the differences between legal and ethical behavior in marketing.LO1Identify factors that influence ethical and unethical marketing decisions.Describe the different concepts of social responsibility.LO3LO2LEARNING OBJECTIVES (LO)AFTER READING CHAPTER 4, YOU SHOULD BE ABLE TO:Recognize unethical and socially irresponsible consumer behavior.LO3THERE IS MORE TO ANHEUSER-BUSCHTHAN MEETS THE PALATEEthicsNATURE AND SIGNIFICANCEOF MARKETING ETHICSLawsEthical-IllegalUnethical-IllegalEthical-LegalUnethical-LegalEthical-Legal FrameworkCurrent Perceptions of Ethical Behavior LO1FIGURE 4-1 Four ways to classify marketing decisions according to ethical and legal relationshipsFIGURE 4-2 A framework for understanding ethical behaviorCultureETHICAL MARKETING BEHAVIORSOCIETAL CULTURE AND NORMSLO2Societal Values and AttitudesAre RelativeAffect Ethical and Legal RelationshipsBusiness CulturesETHICAL MARKETING BEHAVIORBUSINESS CULTURE AND INDUSTRY PRACTICESLO2Ethics of ExchangeCaveat EmptorConsumer Bill of Rights (1962): The Right To Safety To Be Informed To Choose To Be HeardETHICAL MARKETING BEHAVIORBUSINESS CULTURE AND INDUSTRY PRACTICESLO2Consumer ProductSafety CommissionFederal TradeCommission (FTC)The Right to SafetyThe Right to Be InformedETHICAL MARKETING BEHAVIORBUSINESS CULTURE AND INDUSTRY PRACTICESLO2Slotting Allowances/FeesDo Not Call RegistryThe Right to ChooseThe Right to Be HeardETHICAL MARKETING BEHAVIORBUSINESS CULTURE AND INDUSTRY PRACTICESLO2Ethics of CompetitionEconomic EspionageBribes and KickbacksMAKING RESPONSIBLE DECISIONSCorporate Conscience in the Cola WarLO2GOING ONLINEThe Corruption Perceptions IndexLO2ETHICAL MARKETING BEHAVIORCORPORATE CULTURE AND EXPECTATIONSLO2Corporate CultureCode of EthicsEthical Behavior of Top Management and Co-WorkersWhistle-BlowersFIGURE 4-3 American Marketing Association Statement of Ethics (abridged)ETHICAL MARKETING BEHAVIORPERSONAL MORAL PHILOSOPHY AND ETHICSLO2Moral IdealismUtilitarianismNestlé’s Gerber Good StartInfant FormulaSOCIAL RESPONSIBILITY IN MARKETINGTHREE CONCEPTS OF SOCIAL RESPONSIBILITYLO3Social ResponsibilityStakeholder ResponsibilitySocietal ResponsibilityProfit ResponsibilityFIGURE 4-4 Three concepts of social responsibilitySOCIAL RESPONSIBILITY IN MARKETINGTHREE CONCEPTS OF SOCIAL RESPONSIBILITYLO3Societal ResponsibilityGreen MarketingCause MarketingTriple-Bottom LineHäagen-DaszMARKETING MATTERSWill Consumers Switch Brandsfor a Cause? Yes, IfLO3SOCIAL RESPONSIBILITY IN MARKETINGTHE SOCIAL AUDITLO3Social AuditSustainableDevelopmentSOCIAL RESPONSIBILITY IN MARKETINGCONSUMER ETHICS AND SOCIAL RESPONSIBILITYLO4Unethical Practices by ConsumersConsumer Motivations for Unethical BehaviorConsumer Purchase, Use, and Dispositionof Environmentally Sensitive ProductsGreenwashingFTC GuidelinesTOYOTA: BUILDING CLEANER, GREENER CARSVIDEO CASE 4FIGURE 1 Who should take the lead in addressing environmental issues? VIDEO CASE 4Toyota1. How does Toyota’s approachto social responsibility relate to the three concepts of social responsibility described in the text (profit responsibility, stakeholder responsibility, and societal responsibility)?VIDEO CASE 4Toyota2. How does Toyota’s view of sustainable mobility contribute to the company’s overall mission?VIDEO CASE 4Toyota3. Has Toyota’s National Parks project been a success? What indicators suggest that the project has had an impact?VIDEO CASE 4Toyota4. What future activities would you suggest for Toyota as it strives to improve its reputation?EthicsEthics are the moral principles and values that govern the actions and decisions of an individual or group.LawsLaws are society’s values and standards that are enforceablein the courts.Caveat EmptorCaveat emptor is the legal concept of “let the buyer beware” that was pervasive in the American business culture priorto the 1960s.Consumer Bill of Rights (1962)The Consumer Bill of Rights (1962) is a law that codified the ethics of exchange between buyers and sellers, including the rights to safety, to be informed,to choose, and to be heard.Economic EspionageEconomic espionage is the clandestine collection of trade secrets or proprietary information about a company’s competitors.Code of EthicsA code of ethics is a formal statement of ethical principlesand rules of conduct.Whistle-BlowersWhistle-blowers are employees who report unethical or illegal actions of their employers.Moral IdealismMoral idealism is a personal moral philosophy that considers certain individual rights or duties as universal, regardless of the outcome.UtilitarianismUtilitarianism is a personal moral philosophy that focuses on the “greatest good for the greatest number” by assessing the costs and benefits of the consequences of ethical behavior.Social ResponsibilitySocial responsibility is the idea that organizations are part of a larger society and are accountable to that society for their actions.Triple-Bottom LineThe triple-bottom line is the recognition of the need for organizations to improve thestate of people, the planet, and profit simultaneously if they areto achieve sustainable, long-term growth.Green MarketingGreen marketing consists of marketing efforts to produce, promote, and reclaim environmentally sensitive products.Cause MarketingCause marketing occurs when the charitable contributions of a firm are tied directly to the customer revenues produced through the promotion of one ofits products.Social AuditA social audit consists of a systematic assessment of a firm’s objectives, strategies, and performance in terms of social responsibility.Sustainable DevelopmentSustainable development consists of conducting businessin a way that protects the natural environment while making economic progress.