ARBA MINCH UNIVERSITY

SAWLA CAMPUS

COLLAGE OF COMERCE AND BUSINESS ADMINSTRATION

DEPARTMENT OF LOGISTICS AND SUPPLY CHAIN

MANAGEMENT

COURCE TITLE; BUSSINESS ETHICS AND SOCIAL

RISPONSIBILITY

GROUP ASSIGNMENT

SUBMITION DATE: MARCH; 14/2016 E.C

GROUP MEMBERS NAME: ID:

1. Abraham Arsibo 002/2012

2. Legese Tusse 012/2012
3. Bahiru Erdaw ___________
4. Dawit Egedo ___________
5. Belayneh Sapena ___________
6. Abaynesh Murte 001/2012
7. Wudeinsh Yaykob ___________

Submitted to Gedeno G.

Sawla Ethiopia
 Table of Contents
CHAPTER SEVEN...........................................................................................................1
7. ETHICAL MARKETING..........................................................................................1
7.1. Definition............................................................................................................1
7.2. Common Unethical Practices/ Ethical Conflict Faced By the Marketers...........3
7.2.1. False Advertisement:...................................................................................3
7.2.2. Misleading advertising................................................................................4
7.2.3. Bait Advertisement:.....................................................................................4
7.2.4. Spamming....................................................................................................5
7.2.5. Psychoactive Advertisement.......................................................................5
7.3. Factors behind Ethical Practices.........................................................................5
7.3.1. Social Norms...............................................................................................6
7.3.2. Religious Beliefs.........................................................................................6
7.3.3. Upbringing...................................................................................................6
7.3.4. Laws............................................................................................................6
7.4. Marketing Ethics Important Issues.....................................................................7
7.4.1. Cultural sensitivity.......................................................................................7
7.4.2. Data ethics...................................................................................................7
7.4.3. Environmental sustainability.......................................................................8
7.4.4. Fair pricing..................................................................................................8
7.4.5. Influencer marketing...................................................................................8
7.4.6. Privacy concern...........................................................................................9
7.4.7. Social responsibility....................................................................................9
7.4.8. Targeting vulnerable populations..............................................................10
References.......................................................................................................................11

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 CHAPTER SEVEN

7. ETHICAL MARKETING

7.1. Definition

 Marketing ethics refers to the company's moral principles and values during
marketing communications.
 Companies should always keep a 'good conscience' and avoid advertising that
confuses, hurts, or misleads customers.
 Ethical marketing characteristics include transparency, customer data protection,
sustainability, human rights compliance, and customer value maximization.
 Maintaining ethics in marketing can allow businesses to increase sales, build
customer loyalty, attract and retain talents, and keep stakeholders' interest.

Ethical marketing is fair pricing and advertisements that do not exaggerate the benefits
of the promoted product.

Ethical marketing is the application of the ethical principles of the company to its
marketing strategy. It involves promoting products and services honestly, fairly, and
socially responsibly. Consumers today are increasingly aware of social and
environmental issues and are more likely to support companies that align with their
values. Here are some examples of ethical marketing campaigns.

Ethical Marketing Principles

Ethical marketing follows five main principles:

 Transparency - An ethical marketing campaign will reveal all truths about the
products to the customer, including ingredients, components, and production
processes.
 Customer data protection - Ethical marketers don't disclose customer information
without consent. The information collected is only used to benefit the customers,
e.g. recommending products that match their previous purchases.
 Human rights compliance - Marketing campaigns should not offend certain
population groups by criticizing their mistakes or flaws.
 Sustainability - With environmentalism on the rise, companies should show how
their products are sustainable and ethically produced in marketing campaigns.

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 Customer value - Ethical marketing should aim to bring as much value to the
customer as possible while limiting societal risks
Types of ethical marketing

Honesty ;Honesty means telling the truth, being transparent and avoiding deception. In
the past, many companies have used deceptive tactics in their marketing practices to
gain a competitive advantage. However, with the rise of social media and other digital
channels, such tactics are easily exposed and can damage a brand's reputation.

Respect for Individual Rights

This includes respecting privacy, data protection and avoiding discrimination.

Consumers have the right to control their personal data and decide how it is used by
companies. Brands must ensure they are transparent about their data collection and
usage practices and obtain explicit consent from consumers.

Respect for Human Dignity

Brands must recognize the inherent worth and value of each person and treat them
accordingly. In marketing, respect for human dignity means avoiding tactics that exploit
or manipulate consumers, such as intentional deception

Brands must recognize the inherent worth and value of each person and treat them
accordingly. In marketing, respect for human dignity means avoiding tactics that exploit
or manipulate consumers, such as intentional deception.

Responsibility

Marketers have a responsibility to ensure that their marketing efforts do not harm
people or society. They should also be responsible for ensuring that their products or
services are safe and reliable.

Generally Ethical marketing is critical for building trust and long-term relationships
with consumers. Brands that prioritize honesty, responsibility and respect for individual
rights and human dignity will not only meet consumer expectations but also set
themselves apart from their competitors. By implementing these values in their
marketing strategies, brands can create a positive impact on society while also driving
business success.

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7.2. Common Unethical Practices/ Ethical Conflict Faced By the
Marketers

Unethical marketing practices may include sharing customer information without

consent, making untrue claims about the product, or targeting emotionally vulnerable
customers.

Business ethics describes the different ways a person in a business setting can choose to
respond. Towards ethical dilemmas they face, depending on their moral inclinations
influenced by what they feel in general is the acceptable way to act in a decision-
making process. The reason behind these unethical behaviours in marketing stems from
various sources opined that business owners will not tend to relapse on these immoral
behaviours if they had rationally reflected on their dishonest past.

Unethical marketing occurs when companies use misleading, dishonest, and deceptive
advertising. Although this may sound like a fairly simple and straightforward concept,
there are often marketing scenarios that may be viewed as ethically or morally
ambiguous.

 More unethical Marketing Practices

 Making false, exaggerated, or unverified claims
 Distortion of facts to mislead or confuse potential buyers
 Concealing dark sides or side effects of products or services
 Bad-mouthing rival products
 Using women as sex symbols for advertising
 Plagiarism Demeaning references to races, age, sex, or religion of marketing
messages.

7.2.1. False Advertisement:

False advertisement is defined as one that is misleading towards consumers, directing

them to make wrong decisions during purchases. It is considered unlawful when
businesses post false advertisements under the Consumer Protection In order for justice
to be served, consumers have to prove misrepresentation on the seller’s part to represent
their intentional cheating behaviour. Apart from the said Act, consumers may also
report such misbehaviours to the Advertising Standards Authority whose work is to
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obstruct false advertising. Puffing, another term for false advertising plays the role of
exaggerating characteristics of a product offer. Puffing is legal when done base on one’s
opinion. However, if puffing is applied to facts, it contributes to misleading promotion,
and is thus considered illegal .affirms that manufacturer of products is held

Liable if they are found to have applied misleading representation regarding goods or
services rendered under Section of the Act. Next, is misleading or deceptive conduct
under where it is illegal for one to deceive consumers about the characteristics, nature,
suitability, or quantity of the goods or services. Misleading price indications given to
the price of a good or services offered is also illegal of the opinion that firms
deliberately implement false advertising because they are aware that consumers rely on
businesses to provide information about the characteristics of goods or services offered.
Despite possible legal sanctions, firms continue exaggerating descriptions of various
products, ranging from inedible products such as cars to edible ones such as cereals.

7.2.2. Misleading advertising

As has always been the case in marketing, ethical marketing stresses avoiding false or
exaggerated claims that could mislead consumers. All advertising claims must be
accurate, supported by evidence, and not exaggerated. So, of course, you should
thoroughly research and fact-check information before making any claims to avoid
creating any false expectations. Using unambiguous language helps accurately represent
the features, the benefits and the performance of the product or service. Providing
sufficient disclosures (such as fine print or disclaimers) when necessary is also
important to prevent any potential misinterpretations. Don’t forget to regularly review
and update advertising materials to align with changing circumstances.

7.2.3. Bait Advertisement:

Had set out to research the circumstances that influence consumer’s perception towards
varying degrees of sales pressure and the resulting effect it has on consumer’s final
buying decision. Among the few factors investigated include time pressure, buyer’s
assumption towards seller’s knowledge, and buyer’s self-confidence towards their own
knowledge of persuasion. The results showed that buyer’s perception of time pressure
works well in combination with sales pressure. However, the remaining factors
negatively impacted pressure from sellers. Misleading advertising report details bait
advertising as a misguiding sales technique popular among unscrupulous businesses.

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Bait advertising happens when a product is advertised at a much lower price, an act
carried out by the seller, with the motive to entice consumers to purchase their products
with hidden intentions to further convince them into buying more expensive products by
criticizing the initial product being not as good.

7.2.4. Spamming

The advancement of internet has provided attackers unethical means of spreading spam
messages, a popular cybercrime in this age. They defined spam messages as unrelated
and improper mails sent to a vast number of International Journal of Business and
audiences through the internet. The thriving of cybercrime develops into a huge concern
to society, especially in the bustling web traffic, where illegal activities are concealed
under large information transaction happenings. The reason spamming is more popular
through email than phone calls are due to its pervasive omnipresence in every
individual’s life around the world. Spam mails are usually adorned with quality content
aimed to persuade consumers behind the deceptive veil of criminal acts.

7.2.5. Psychoactive Advertisement

Psychoactive advertisement, in the opinion of is unethical as sellers often do not warn

consumers when deploying this technique, despite consumers viewing it as acceptable if
the threats claimed in the psychoactive advertisement could eradicate the danger posed.
Psychoactive advertising is seen as dangerous because it may summon consumer’s
extreme emotions causing them to self-harm shared in their research entitled “The
Ethics of Psychoactive Ads” that psychoactive advertisements are commercials aimed to
arouse audience’s strong emotions to achieve specific results, such as stirring anger,
sorrow, concern, or disturbing them. Widely used in public service broadcasting, it is
effective in making viewers identify hostility or lowered self-esteem. However, not all
emotional-stirring advertisements can be grouped as psychoactive advertisements.

7.3. Factors behind Ethical Practices

Ethics is a code of honour that individuals live by. What defines ethical from unethical
behaviour can be formed in early childhood and carry through to adulthood. The factors that
define ethical behaviours are diverse, but all factors unite when a person makes a final
decision on how to act. While the reasons are diverse, they are not difficult to understand.

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7.3.1. Social Norms

Local customs can define the ethical behaviour of those living within that culture. What
is considered normal in one culture can be completely unnatural in another; what is
ethical in one culture can be unethical in another speaking to the Royal Society for the
Encouragement of the says that different cultures have ethical differences., for example,
discovered that immigrant children are non-violent, but quickly adopt the social norms
of aggression in the United States.

7.3.2. Religious Beliefs

Many believe in life after death. Most religions have a common theme of judgment in
the afterlife. In the afterlife, many believe good deeds during natural life are rewarded
and bad deeds can be punished. In defining good deeds, religions have developed moral
codes to live by, such as the Ten Commandments, which forbid theft, killing and other
unethical behaviours. How devoutly a person adheres to these moral codes is a factor
defining overall ethical behaviour.

7.3.3. Upbringing

An adult's upbringing also determines ethical behaviour. In general, adults who were
brought up in loving, non-abusive households display socially appropriate ethical
behaviour. Conversely, adults who were brought up in abusive, dysfunctional families
tend to display unethical behaviour. Prevent Child Abuse America, in an extensive 2008
study, found that 42 percept of abused children were arrested for crimes when they
became adults.

7.3.4. Laws

Laws, and a person abiding by them, influence ethical behaviour. Fear of prosecution
and punishment is a great deterrent, and as such, many do not break the law. In the
United States, ethical behaviour is defined by law, such as not stealing or not causing
property damage. The level of punishment is roughly tied to the level of crime. A
person knows that, for example, if he is caught shoplifting, he could go to jail. This
deters him from shoplifting.

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7.4. Marketing Ethics Important Issues

The marketing function is as much about business success and profit as any other
business function, if not more so. has long been at the head of a global trend towards
more ethical behaviour from businesses, and marketing leaders need to be aware of the
issues that this raises for their day-to-day activities. Ethical marketing is something that
is here for the long term. Although many would argue that ethics have always been an
important behaviour guide, marketing leaders now need to understand the issues that it
raises and work within consistent guidelines.

There is no universal code to work to, and many issues must be considered. Broadly
speaking, ethics in marketing refers to the practice of conducting marketing activities in
a manner that aligns with moral principles, societal values, and legal standards. It
involves the promotion of transparency, honesty, fairness, and social responsibility
throughout the entire marketing process. This is doubly relevant for marketers because
it not only contributes to the overall trust and credibility of the business, but also
upholds the well-being and rights of consumers – whose rights and interests marketers
are responsible for representing within the organisation.

There are many Marketing Ethics Important Issues

7.4.1. Cultural sensitivity

As the world becomes more interconnected, marketers must be mindful of cultural

differences and avoid offensive or insensitive marketing messages.

Cultural sensitivity in marketing entails understanding and respecting different cultures’

values, beliefs, customs and preferences and tailoring marketing strategies accordingly.
Recognizing unique cultural nuances and avoiding stereotypes or cultural appropriation
can help to build more genuine connections with audiences. It helps to demonstrate a
commitment to diversity and inclusion in an increasingly multicultural world.

7.4.2. Data ethics

Marketers should be transparent about the data they collect from consumers and ensure
that it is used ethically and securely. Adhering to data ethics principles means (amongst
other legal requirements) obtaining informed consent from consumers, providing clear
opt-out options, and safeguarding data against breaches or any form of exploitation. It

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also involves using data analytics responsibly, avoiding discriminatory targeting or
profiling, and ensuring the security and anonymity of personal information.

7.4.3. Environmental sustainability

With growing environmental concerns, marketers need to consider the impact of their
products and marketing practices on the planet.

Environmental sustainability specifically in marketing, involves adopting practices that

minimize the negative impact of marketing activities on the planet. This should ideally
include policies to reduce carbon emissions (which needs to include those from
indirectly controlled suppliers such as media owners); the promotion of eco-friendly
products and services, and advocacy of responsible consumption. Good sustainable
marketing practices entail incorporating sustainable materials, packaging, and
manufacturing processes and encouraging recycling and waste reduction throughout the
product lifecycle. Aligning marketing efforts with environmental values helps to ensure
that businesses contribute to the preservation of the environment and has the additional
benefit of helping to enhance brand reputation with increasing numbers of customers
and other stakeholders.

7.4.4. Fair pricing

Marketers should avoid using pricing practices that discriminate against certain groups
of consumers.

A fair pricing policy should involve setting reasonable, justifiable, and aligned with the
value provided to customers. This entails avoiding price discrimination based on factors
such as race or gender and ensuring that pricing strategies do not exploit vulnerable or
disadvantaged individuals. Businesses committed to fair pricing use open
communication about pricing structures and avoid deceptive pricing tactics.

7.4.5. Influencer marketing

With the rise of influencer marketing, marketers should ensure that influencers are
transparent about their relationships with brands and disclose any sponsored content.

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Marketers need to be careful about the selection of influencers. Find those who align
with your brand’s values and target audience, and ensure their content is genuine and
truthful. Responsible influencer marketing also involves transparency in disclosing
sponsored partnerships clearly and prominently. It also emphasises the importance of
promoting responsible messaging and avoiding promoting harmful or unethical
products.

7.4.6. Privacy concern

With the increase in high-profile data breaches and the use of personal information for
marketing purposes, consumers are becoming more aware of their privacy rights.

Maintaining consumer privacy in marketing is fundamental to ethical and responsible

practices. Respecting consumer privacy entails safeguarding personal information
collected during marketing activities and ensuring secure storage and usage. Marketers
should be transparent about the data they collect, why, and how it will be used. It is
important to obtain explicit consent from individuals before collecting and utilizing
their personal data. Marketing teams should consider implementing robust data
protection measures, such as encryption and secure databases, which help to prevent
unauthorized access or breaches. Other points of ethical behaviour concerning customer
data include refraining from sharing or selling it to third parties without explicit
consent; regularly updating privacy policies; providing accessible opt-out mechanisms;
and promptly addressing consumer inquiries and concerns about data privacy.

7.4.7. Social responsibility

There is little doubt that consumers are increasingly looking for brands that align with
their values and contribute to social causes.

Social responsibility in marketing encompasses the ethical obligation of businesses to

consider the broader impact of their marketing activities on society. It involves
integrating social and environmental considerations into marketing strategies to promote
positive change and to address societal issues.

Socially responsible marketing practices also include the fundamental good practice of
avoiding misleading or deceptive advertising. Marketers could also consider the role of
their products or services in benefiting society (not just their role in fulfilling individual

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customer needs); engaging in cause-related marketing initiatives; supporting diversity
and inclusion; treating employees and suppliers fairly; and minimizing the
environmental footprint of marketing activities. It’s a growing list that needs constant
review to help create a more sustainable and equitable future.

7.4.8. Targeting vulnerable populations

Marketers should avoid targeting vulnerable populations, such as children or the elderly,
with marketing messages that could be harmful or exploitative.

Targeting vulnerable populations can lead to unfair and potentially harmful outcomes,
such as encouraging excessive consumption, promoting unhealthy behaviours, or
creating financial strain. So marketers must consider consumer well-being, respect
boundaries, and ensure that their advertising provides accurate and helpful information.

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