1. GROUP – 4
Priyanthika
Nilaweera
Ravin
Ovitigala
Sujith De
Alwis

2. Contents
• What is Marketing Ethics?
• How it is important?
• Ethical issues related to Marketing Mix
• The Nature of Marketing Ethics
• Improving Ethical Conduct in Marketing
• Social Responsibility and Ethics
• Benefit of Ethical Marketing

3. Marketing Ethics
Dimension of social responsibility that involves
principles and standards the define acceptable
conduct in marketing.

4. Involvement of People
Acceptable standards of conduct in marketing
involves;
– Individual or Group Decisions
– Stakeholders
– Organization ethical Climate

5. Marketers should be
aware of their acceptable
conduct from several view
points
• Company
• Industry
• Government
• Customer
• Special interest Group
• Society at Large

6. Is it Important?
When marketing activities deviate from accepted
standards, the exchange process can break down,
resulting;
- Customer Dissatisfaction
- Lack of trust
- Legal issues
- Income falls

7. Ethical Issues In Marketing
An identifiable problem, situation or
opportunity that requires concern parties to
choose from several actions that must be
evaluated as right or wrong, (ethical or Unethical)

8. Ethical issues related to Marketing Mix
PRODUCT
DISTRIBUTION
PROMOTION
PRICING

9. Product
Withholding critical information such as
performance, risk associated and also fail to inform
customers about existing condition and changes in
product quality that could affect purchase decision.

10. Distribution
Ethical issues in distribution involve relationship among
producers and middlemen or intermediaries
(wholesales and retailer), facilitate the flow of products
from producer to the ultimate customer
Serious issues with regard to distribution include
manipulating a product availability for price gaining.
Eg – Milk Powder shortage

11. Promotion
PROMOTION
It can create ethical issues in many ways among them
false or misleading advertising and manipulative or
deceptive sales promotions, tactics and publicity.

12. Pricing
Common ethical issues are price fixing, destructive
pricing.
Organizations have right to price their product to earn a
reasonable profit, but issues may crop up when they seek
to earn high profits at the expense of its customers.

13. Ravin Ovitigala
2014 / MBS / WD / 18

14. The Nature of Marketing Ethics

15. Individual Factors
• People resolve their ethical conflicts in their daily
lives, with their own values and principles of right or
wrong.
• People learn values and principles through
socialization, social group, religion, and formal
education.
“ however research has established that an
organization values often influence on marketing
decisions than a persons own values “

16. Personal Moral Philosophies
• That is important for influencing a persons
ethical decisions there is two aspects of
personal moral philosophies
– Idealism
– Relativism

17. Organizational relationships
• Ethical choices in marketing are often made
jointly, in work groups and committees or in
conversations and discussions with coworkers
Marketers resolve their issues based not only on what
they learned from their own background but also on
what they learn from others in the organization.
Out come of the learning process depends on the
strength of each individual’s personal values…..

18. Opportunity
• Another factor that may shape ethical
decisions in marketing. Conditions that limits
barriers or provide rewards.
A marketer who takes advantage of an
opportunity to act unethically and is rewarded
or suffers no penalty may repeat such acts when
an opportunity arise.

19. Corporate Culture and Ethics
• Firms culture may be expressed formally through
codes of conduct, memos, manuals, dress codes, and
ceremonies. It is also conveyed informally through
codes work habits, extracurricular activities.
• Culture gives its members meaning and suggests
rules for how to behave and deal with problems
within the organization.
• Cond……

20. Cond…..
• Interaction between corporate culture and
leadership helps determine the ethical value system .
Eg -Ethics & Compliance
The core of the ethics and compliance program at The Coca-
Cola Company is our Code of Business Conduct. The Code guides
our business conduct, requiring honesty and integrity in all
matters. All of our associates and directors are required to read
and understand the Code and follow its precepts in
the workplace and larger community.
Muhtar Kent, Coca-Cola's chairman and CEO.

21. Work Pressure
• Organization pressure plays a key role in creating
ethical issues,
• Eg – Pressure to meet a sales target may result in
overaggressive sales tactics.

22. Types of Misconduct likely to be reported
Giving or accepting
bribes
Improper hiring
practices
Discrimination
Lying to employees,
customers etc..
E mail or internet
abuse
• Source : National
Business Ethics survey

23. Priyanthika Nilaweera
2014 / MBS / WD / 17

24. Improving Ethical Conduct in Marketing
• Some times organizations become bad barrels it is
not because the individuals and their unethical
behavior but because of the pressures to survive and
succeed create conditions that rewards unethical
behavior.

25. • Organizations that wish to improve their ethics
should implement a strong ethics and compliance
program and encourage organization wide
commitment to an ethical culture,
–Code of Conduct
–Ethics officers
–System for anonymous reporting

26. Codes of Conduct
• Many organizations have developed codes of
conduct that consist of formalized rules and
standards that describe what the company expects
of its employees
“Guidelines that enable employees to achieve
organizational objectives in an ethical manner”

27. Ethics Officers
• Ethical officers are responsible for creating
and distributing a code of conduct, enforcing
code meeting with employees and discuss,
advise about ethics.
A high ranking person should hold the position
in the organization who are know to respect
legal and ethical standards

28. • Eg - Telecom has appointed a independent
person as an ethical officer where employees can
talk, report any misconduct.
• has a employ toll free number
“hotline” to provide any advice to employees who
believe they face an ethical issue

29. Social Responsibility and Ethics
• Two concepts are interrelated, companies that
support socially responsible decisions and adheres to
a code of conduct likely to have positive effects on
society.

30. Social Responsibility and Ethics
• Ethics is one dimension of social responsibility, Being
socially responsible relates doing what is
economically sound, legal, and socially conscious.
• A rule of thumb for resolving ethical and social
responsibility issues is that if an issue can withstand
open discussion that results in agreement or
acceptable solution may exist.
• Contd……..

31. Contd……..
• Openness is not the end - all solution to the ethics
problem, however it creates trust and facilitates
learning relationships…

32. The challenge of ethical and socially responsible behavior
• Marketers must monitor changes and trends in
society’s value while achieving organization goals.
• Most ethical issues cannot be viewed in Black &
white. Therefore balancing society’s demand to
satisfy is difficult

33. The challenge of ethical and socially
responsible behavior
• Eg – 40 years ago tobacco marketers
promoted cigarettes as being good for ones
health, today years after the discovery that
cigarette smoking is linked to cancer and other
medical problems.

34. Social Responsibility and Ethics
Improve Marketing Performance
• A direct association exists between social
responsibility, ethics, customer satisfaction and
profits..
• In a Survey of consumers, nearly 86% indicated that
when quality and price are similar among
competitors, they would likely to buy from the
company associated with ethical and social
responsibility.

35. Social Responsibility and Ethics Improve
Marketing Performance
• Organizations that fails to develop strategies
and programs to incorporate ethics and social
responsibility into their culture may pay the
price with poor marketing performance,
potential cost of legal violation, wrong
promotion activity etc…
However the concepts are undoubtedly
controversial, it is possible and desirable to
practice ethics and social responsibility in their
planning process

36. Benefits of Ethical Marketing
• It pays
• You Build trust
• You make more money
• You build more relationship with people
whose lives you are making better
• You are happy because you made others
happy

37. Thank you !