Transcript Document

A = Ethical and acceptable behavior
B = Ethical, but undesirable behavior for society
C = Moderately unethical behavior
D = Seriously unethical behavior
1. Manufacturing stuffed animals that are known to be
flammable and selling the stuffed animals for toddlers
and infants
2. Producing products that cannot withstand ordinary
wear and tear, but are sold at standard prices
3. Offering warranties with insufficient time or parts
coverage
4. Manufacturing non-biodegradable plastic products
A = Ethical and acceptable behavior
B = Ethical, but undesirable behavior for society
C = Moderately unethical behavior
D = Seriously unethical behavior
5. Selling apple flavored sugar water as apple juice
6. Bribing Federal Drug Administration officials to secure agency
approval of pharmaceuticals
7. Substituting generic drugs for branded prescriptions without
customer approval
8. Selling counterfeit branded goods sold as originals
A = Ethical and acceptable behavior
B = Ethical, but undesirable behavior for society
C = Moderately unethical behavior
D = Seriously unethical behavior
9. Setting high prices to connote quality
10. Using yield-management pricing of airline tickets resulting in
day-to-day differential pricing of adjacent seats
11. Using puffery in advertising, such as Wilkinson Blades
claimed its ultra Glide Razor offered “the smoothest, most
comfortable shave known to man”--an assertion challenged by
Gillette
12. Using sexual innuendoes and gender stereotyping (e.g.,
Miller Brewing Company targeted college males with ads on
“how to scam babes”)
A = Ethical and acceptable behavior
B = Ethical, but undesirable behavior for society
C = Moderately unethical behavior
D = Seriously unethical behavior
13. Using inner-city billboards promoting luxury products (e.g.,
$125 sneakers targeted to ghetto youth)
14. Using rock stars as spokespersons to promote beer, liquor,
cigarette ads
15. Placing ads on children’s TV programs for nutritionally
unsound products (e.g., sugary cereals, candy, etc.)
16. Using phony markdowns based on overstated retail list
prices
A = Ethical and acceptable behavior
B = Ethical, but undesirable behavior for society
C = Moderately unethical behavior
D = Seriously unethical behavior
17. Luring consumers with ads for low-priced merchandise with
the hope of switching them to higher-priced models once in the
store, even though the low-price merchandise is available
18. Using misleading product performance claims
19. Using “packaging-to-price” tactics that mask an increase in
price by maintaining the same package price, but decreasing
package size
20. Returning clothing that has been worn satisfactory several
times; i.e., the clothing has no defects
A = Ethical and acceptable behavior
B = Ethical, but undesirable behavior for society
C = Moderately unethical behavior
D = Seriously unethical behavior
21. Redeeming coupons that have expired
22. Returning clothing bought at full-price after the item has
gone on sale, and demanding a refund for the sales price
differential
23. Returning products bought on sale and demanding the fullprice refund
24. Returning partially used products for full store credit
A = Ethical and acceptable behavior
B = Ethical, but undesirable behavior for society
C = Moderately unethical behavior
D = Seriously unethical behavior
25. Damaging merchandise in a store and then demanding a
sales discount
26. Copying copyrighted materials (e.g., books, videotapes,
computer software) without permission
MARKETING ETHICS 3
Mattel – Product Safety Crisis
Lead paint
from
subcontracted
manufacturer
in China
3-3
MARKETING ETHICS 3
Firm Goals
Greed and short
term profit seeking
Serious long term
consequences
Creating value
over the long run
Long term
success
3-4
The Six Tests of Ethical Action
The Publicity Test
• Would I want to see this in the media?
The Moral Mentor
Test
• Would the person I admire the most do this?
The Admired
Observer Test
• Would I want the person I admire the most to SEE
me doing this?
The Transparency
Test
• Could I give a clear explanation for the action
The Person in the
Mirror Test
• Would I be able to look in the mirror and respect
myself
The Golden Rule Test
• Would I like to be on the receiving end of this
action?
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Scenario 1: R.J. Reynolds: Promotions to the Youth Market
R.J. Reynolds sent a set of coasters featuring its cigarette brands
and recipes for mixed drinks with high alcohol content to young
adults, via direct mail, on their 21st birthdays. The brands
included in the recipes included Jack Daniels, Southern Comfort,
and Finlandia Vodka. The reverse side of the coaster read, “Go
‘til Daybreak, and Make Sure You're Sittin’.” The campaign clearly
promoted abusive and excessive drinking. This campaign was
eventually stopped because the cigarette company did not have
permission to use the alcohol brands.
Scenario 1: R.J. Reynolds
• What are the ethical
issues
– Mailings to young adults
• Is it wrong? Why or
why not?
Publicity – Moral Mentor – Admired Observer – Transparency – Mirror – Golden Rule
3-35
Scenario 2: Victoria's Dirty Secret
Forest Ethics, a nonprofit environmental organization, launched a
campaign against the lingerie store Victoria's Secret, protesting the
enormous amount of paper used in its catalogs. The organization put
full-page ads in magazines, chained themselves to stores, and faxed
nasty letters to Victoria's Secret's corporate offices asking the company
to use recycled paper or discontinue its catalog business. They became
very “annoying,” by interrupting day-to-day operations. Forest Ethics
even attended the shareholders' meeting to find out exactly what the
company planned on doing in the future.
Victoria's Secret's catalog business generates more than $1 billion in
sales. When the company tried to use recyclable paper, it found that it
could not achieve the same quality glossy photos for the catalog. As a
result, it did not change the paper that it used. Its negative press did
not have a negative effect on Victoria's Secrets' sales. If the company
changes its mind and decides to stop printing catalogs, it would save
the trees, but it might cause lost sales, and ultimately lost jobs.
Scenario 2: Victoria’s Dirty Secret
•
•
•
•
What was Victoria’s Secret doing?
Was it wrong?
Unethical
How could they fix this?
Publicity – Moral Mentor – Admired Observer – Transparency – Mirror – Golden Rule
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Scenario 3: The Jeweler's Tarnished Image
Sparkle Gem Jewelers, a family-owned costume jewelry
manufacturing business, traditionally sold its products only to
wholesalers. Recently Barb Stephens convinced Sparkle Gem Jewelers
to begin selling through a network of distributors who recruited
individuals to host “jewelry parties” in their homes. Sparkle Gem's
owners, the Billing family, have been thrilled with the revenue
generated by these home parties.
Mrs. Billing just received a letter from a jewelry party customer, who
expressed sympathy for her loss. Mrs. Billing was concerned and
contacted the letter writer, who told her that Barb Stephens had come
to the jewelry party at her church. According to Stephens's story, Mrs.
Billing was a young widow struggling to keep her business together
after her husband had died on a missionary trip. The writer had
purchased $200 worth of jewelry at the party and told Mrs. Billing
that she hoped it helped. Mrs. Billing was stunned, having just
celebrated her 50th wedding anniversary.
Scenario 3: The Jeweler’s
Tarnished Image
• Is the manufacturer
responsible for the acts
of independent sales
people?
• How do you feel the
Billing’s should
respond?
Publicity – Moral Mentor – Admired Observer – Transparency – Mirror – Golden Rule
3-38
Scenario 4: Bright Baby's Bright Idea
Bartok Manufacturing produces a line of infant toys under the “Bright
Baby” brand label. The Consumer Product Safety Commission (CPSC)
recently issued a recall order for the Bright Baby car seat gym, a very
popular product. According to the CPSC, the gym contains small parts
that present a choking hazard.
The recall could cost as much as $1 million in lost revenue from the
Bright Baby line. Noting that there had been no deaths or injuries from
the product, just the potential for injury, it is proposed that the
remaining inventory of car seat gyms be sold where there are no rules
such as the CPSC's. The marketing director for Bartok recommended
that the product be repackaged and sold under a different brand name
so that the Bright Baby name would not be associated with the
product. Bartok, though a bit leery of the plan, agreed to go along with
it to avoid the monetary losses.
Scenario 4: Bright Baby’s Bright Idea
• Is the potential for injury
enough to merit removal
of the product from the
market?
• Do you feel it is ethical to
move the product to a less
regulated market?
• What would you have
advised the CEO?
Publicity – Moral Mentor – Admired Observer – Transparency – Mirror – Golden Rule
3-39