Ethical, Regulatory, and Environmental Issues in Marketing Communications

Ethical Issues in Marketing Communications -Ethics:involves matter of right and wrong, or moral, conduct pertaining to any aspect of marketing communications. -Ethics in Marketing is integrated in Honesty, Honor, Virtue, and Integrity.

Three Ethics of Targeting:

-Targeting to Children and Teens

- Targeting children is unethical because they

use children's trust

- Targeting Economically Disadvantaged Consumers

-Unethical because those people have

better things to buy than cigarettes

- Is Targeting Unethical or Just Good Marketing?

- Marketing people believe that advertising is done just

to satisfy a particular need

- Others believe that some of it is unethical and

manipulative

Ethical Issues in Advertising:

- Advertising is Untruthful and Deceptive

- Two-thirds of Americans think that ADS are

untruthful

- Deception occurs when ADS falsely represent a

product and consumers believe it

- Advertising is Manipulative

- When ADS have the power to influence people

to do things then it is considered manipulative

- Priming can be very influential because

advertisers can take advantage of that

- Advertising practitioners do have the ability to

influence consumers in very subtle way

-Advertising Is Offensive and in Bad Taste

- Sometimes ADS are insulting to human

intelligence, vulgar, and offensive

- Advertising Creates and Perpetuates Stereotypes

- Ads creates and perpetuates women, and

disadvantaged people and therefore is guilty

- People Buy Things They Do Not Really Need

- Ads cause people to buy items or services they

do not need

- Advertising Plays on People's Fears and Insecurities

-Ads can appeal negative emotions such as fear,

guilt, and humiliation

- Hence, (AAAA) is an association that sets

standards on ethics in advertising

Ethical Issues in Public Relations

-Publicity involves disseminating positive info

about a company and its products

Ethical Issues in Packaging and Branding

- Four Aspects of Packaging involve Ethical issues

-Label Information

- Can Mislead consumers by

providing exaggerated information

- Packaging Graphics

-Are unethical when the picture on

the package does not represent the

real product.

- Packaging Safety

- Unsafe Packaging are acute when

when packaging is not tamper proof

-Environmental Implications

- Packaging is unethical when it provides wrong environmental benefits Ethical Issues in Sales Promotion - Consumers are responsible too in sales promotion Ethical Issues in Online Marketing - It is unethical because they invade individual Privacy Fostering Ethical Marketing Communications

-Act in a way that you would want others

to act towards you

- Take actions that would be viewed as proper

- Always ask would I would be comfortable

explaining this action on TV to the general

public

Regualtion of Marketing Communications

- What is regulation Justified?

Three Benefits

-Consumer Choice

-When consumers are informed

product quality tends to improve

-Reduced Prices

Regulation of Marketing Communications by Federal Agnecies

Deceptive ADS

-Impression left by the claim or campaign

- False claim is believed by consumers

Misleading

- There must be a representation,

ommision, or a practice that is

likely to mislead the consumer

Reasonable Consumer

Material

-The information is the material that is

presented

Unfair Practices

-Unfair advertising: "acts or practices that cause

or are likely to cause injury to consumers

Information Regulation:

- Corrective Ads is based on the premise that

a firm that misleads consulers should have

to use future advertisment to rectify the

deceptive ads

- Product Labeling

- Prescription Drug Advertising

State Agencies's Regulation of Marketing Communication

- The (NAAG) plays an important role in ADS

since they control the ADS

Advertising Self-Regulation

-Self Regulation: form of private

government whereby peers

establish and enforce volantary rules

of behavior

- Media Self-Regulation

- Advertising Agency Clearance

- Approval from the advertiser's

legal department

- The National Advertising Review Council

-( NARC) has been the most

publicized and most effective form

of self-regulation

- Consists of Three Categories

- Children's Advertising Review Unit

- NAD

- National Advertising Review Board

Environmental, or "Green", Marketing Communications

- Green Marketing Initiatives

- Motivated by compliance,

gaining competetive advantages,

and being socially responsible

some companies have made

responses to environmental issues

-Green Advertising

Three types of Green ADS

- Ads that adress relations

between product and service

- those that promote green

lifestyle

-Ads that present a corporate

image of environment

responsibility

-Seal-of-Approval Programs

- Cause-Oriented Programs

- Point-of-Purchase Program

Guidelines for Green Mareketing

General Guidelines

1. Make Specific Claims

2. Reflect Current Disposal Options

3. Make Substantive

4. Make Supportable Claims

Marcom's Challenges: Enhancing Brand Equity, Influencing Behavior, and Being Accountable

The Concept of Brand Equity: Brand: represents a "name, term, sign, symbol, or design, or a combination of them intended to identify the goods and services of one sellers and to differentiate them from those of competition". A brand is everything that one compnay's particular offering stands for in comparison to other brands in a category of competitive products. Brand represents a set of values that its marketers, senior compnay officials, and other employees consistently embrace and communicate for extended period. A Firm-Based Perspective on Brand Equity The firm-based viewpoint of brand equity focuses on outcomes extending from efforts to enhance a brand's value to its various stakeholders. As the value of a brand increases, positive outcomes result. - achieving a higher market share -increasing brand loyalty - being able to change premium prices - earning a revenue premiuim Revenue Premium: the revenue differential between a branded item and a corresponding private labeled item. A Customer-Based Perspective on Brand Equity Brand equity from the customer's perspective consists of two forms of brand-related knowledge: brand awareness and brand image. Brand Awareness Brand awareness is an issue of whether a brand name comes to mind when consumers think about a particular product category and the ease with which the name is evoked. Brand awareness is the basic dimension of brand equity. Brand recognition reflects a relatively superficial level of awareness, whereas brand recall indicates a deeper from of awarenes. Although building brand awareness is a necessary step toward brand equity enhancement, it is insufficient. Brand Image The second dimension of consumer-based brand knowlmedge is a brand's image. Brand image can be thought of in terms of the types of associations that come to the customer's mind when contemplating a particular brand. An association is simply the particular thoughts and feelings that a consumer has about a brand, much in the same fashion that we have thoughts and feelings about other people. 1. Sincerity: Includes brand that are down-to-earth, honest, wholesome, and cheerful. 2. Excitement: Brands scoring high on the excitement dimension are percieved as daring, spirited, imaginative, and up-to-date. 3.Competence: Brands scoring high on this personality dimension are considered reliable, intelligent, and successful. 4. Sophistication: Brands that are considered upper class and charming score high on the sophistication dimension. 5. Ruggedness: Rugged brands are thought of as tough and outdoorsy. How Can Brand Equity Be Enhanced? In general, efforts to enhance a brand's equity are accomplished through the initial choice of positive brand identity but mostly through marketing and marcom programs. A favorable brand image does not happen automatically. Sustained marketing communications are generally required to create favorable, strong, and unique associations. Ingredient branding is a special type of alliance between branding partners. What Benefits Results from Engancing Brand Equity? One major by-product of efforts to increase a brand's equity is that consumer brand loyalty might also increase. Research has shown that when firms communicate unique and positive messages via advertising, personal selling, promotions, events, and other means, they are able to differintiate their brands effectively from competetive offerings and insulate themselves from future price competition. Characteristics of World-Class Brands 1. Brand excels at delivering the benefits customers truly desire. 2. The brand stays relevant 3. The pricing system is based on consumers' perceptions of value 4. Th brand is properly positioned. 5. The brand is consistent 6. The brand portfolio and hierarchy make sense 7. The brand makes uses of and coordinates a full repertoire of marketing activities to build equity. 8. The brand's managers understand what the brand means to consumers. 9. The brand is given proper support, and the support is sustained over the long run. 10. The company monitors sources of brand equity. Affects Behavior and Achieving Marcom Accountability Marcom's eventual challenge is to influence behavior, whatever the nature of that bevior might be. The effect of marcom, or of ots specific elements such as advertising, can thus be gauged in terms of whether it generates a reasonable revenue returns on the marcom investment. Difficulty of Measuring Marcom Effectiveness Though most marketing executives agree that measuring marketing performance is critically important, at the present time relatively few organizations are doing a sophisticated job. Choosing a Metric An initial problem is one determining which specific measures should be used to judge marcom effectiveness. The difficulty of determining how best to measure marketing's return on investment is illustrayed by a recent study conducted of its membership by the(ANA). Gaining Agreement As generally is the case when intelligent people representing different organizational interests are asked to settle in on a particular solution to a problem. Collecting Accurate Data Whatever the measure chosen, any effort to meaningfully assess marcom performance necessitates having data that are reliable abd valid. Calibrating Specific Effects Our hypothetical automobile company will employ several marcom tools to "move" automobiles to consumers. Assessing Effects with Marketing-Mix Modeling To understand and appreciate the nature and role of marketing-mix modeling le's return to the exmaple of the automobile. In order to emplot marketing-mix modeling, a relatively long series of longitudinal data- say, for a two -year period- is required. Marketing-mix modeling is widely used by consumer package good companies.