Introduction

Ethics in the various areas of business is a complex and contentious topic that has been a subject of extensive debate for many years. The biggest challenge for businesses is finding the right balance between making money and doing what is right. Businesses endeavor to satisfy their clients’ needs while at the same time achieving efficient profit levels. Marketers find it tough to apply ethics in marketing a product that has harmful effects. Marketers often influence human desires and conduct, driving their purchase of various goods and services that they may or may not need. The end result is either a good or bad feeling on the part of the consumer or marketer. There are ethical issues that arise with the kind of methods that marketers use to get people to buy the commodities that they may be offering (Schlegelmilch, 1998). For instance, someone marketing cigarettes may try to use other attributes that may be false to divert attention away from their harmful effects and potential customers to buy the product. There are those who even use fear while some may capitalize on people’s ignorance to influence their behavior. Such behavior is unethical. Important to note is the fact once a consumer finds out the truth, the outcome might be the spread of a negative perception about the product among consumers. Ethical marketing is the key to long-term profitability. This paper examines existing literature on the topic of ethical marketing.

Literature Review

Hunt and Vitell (1986), in their article, “A General Theory of Marketing Ethics,” make an attempt at explaining the decision-making process as a situation that has an ethics component in them. In their analysis of studies of marketing practices, their findings indicated that most managers viewed their marketing practices as ethical despite some being clearly unethical. A good example of such unethical practices can be seen in a case of an automobile safety feature. An automobile manufacturer may develop a device that reduces traffic injuries by about 50%. However, the device might have some cost implication that would move the prices of their cars up resulting in some loss in sales to the advantage of the firm’s competitors. For this reason, the automobile maker may opt not to include the device in their cars not unless the relevant authorities make it a requirement for all car manufacturers.

When Hunt and Vitell (1986) posed the question on whether the company’s actions were ethical or not to a sample group to determine their reaction, they found that perceptions varied depending on one’s occupation. However, they could not clearly determine the main reason for the difference in perceptions. Those in executive positions were less likely to term the automaker’s move as unethical. A mere 51% agreed that the actions of the firm were unethical. 76% of housewives found the situation as being unethical. The huge difference leaves a lot to be desired.

A huge proportion of the research on marketing is fragmented and scattered. Research on ethical marketing also suffers some serious setbacks. Due to the absence of a guiding model, instead of past empirical research on the subject producing scholarly light, it has created more emotional heat. Hunt and Vitell’s research develops an ethical marketing theory intended to guide empirical research.

Crane and Matten (2010) tackle the subject of ethics in business. According to them the subject of ethics is important for many reasons. One of them is that the power that companies wield in the society is greater now that it has ever been before. They can impact the society immensely. The malpractices that they engage in can cause grievous harm to the environment, individuals, and communities. Stakeholder interests increasingly inform the decision of businesses to be ethical in conducting their activities. The investment of resources into the pursuit of ethics varies from one organization to the next depending on the size and type of organization. Crane and Matten (2010), note that small organizations allocate little resources compared to large ones. Large organizations also tend to employ a more formal approach to the management of ethics. At the center of ethical decisions is profitability concerns that tend to put a limit on the resources that companies are willing to spend on the ethics management. Most organizations use the subject of ethics to market their businesses and ensure their prominence. Such a tool is community social responsibility (CSR) where companies take part in initiatives that benefit the communities in the markets that they serve (Murphy & Laczniak, 1981). Stakeholders require that the ethical measures a firm takes make sense. For this reason, large corporations tend to base their ethical decisions on rational, widely understandable and systematic argument that they can manage to defend, justify, and elaborate to the affected stakeholders. Crane and Matten posit that there are two extreme positions to ethical theories. The two are ethical absolutism and ethical relativism. The book “Business Ethics: Managing corporate citizenship and sustainability in the age of globalization,” by Crane and Matten (2010) conducts an in-depth analysis of various theories and their relevance to the decision-making process.

“Ethical Marketing and the New Consumer,” a book by (Arnold, 2009) is also very resourceful when it comes to an exploration of the subject of ethics in marketing. Arnold (2009) holds the view that perception about ethics is often subjective. Each individual may have their own thoughts on what they find as being ethical. When one genuinely considers the impact of their actions, they begin to develop a sense of who they are and their moral code. Such conceptualization is influenced by the environment in which one lives. When it comes to any business, ethics is rooted in the ethos. A firm first determines its beliefs, its level of preparedness to tell the truth and whether it has the potential of delivering to its clients (Tadajewski & Brownlie, 2008).

Arnold (2010), in his book, he posits that getting things right from the start in relation to ethics is the surest way to building a strong foundation for the future. The author is highly critical of the move by many businesses to use the green bandwagon to market their products without conducting due diligence on the viability of such options. Many of the firms tend to end up wasting a significant proportion of their resources to campaigns aimed at making their brands appear more ethical. The book’s primary agenda is to help brand and marketing managers to avoid the trap of greenwash or other situations that may be worse serving to damage their brand’s reputation. It also offers useful marketing guidance for eco-ethical businesses. Prominent in the author’s work is his challenge to the assumption that going green is being ethical. Arnold (2009) presents sample cases involving issues of ethical marketing and some of the outcomes to illustrate the role of ethics in the success of a business. The book calls for self-evaluation on the part of firms before they choose to engage in any ethical marketing to avoid unnecessary waste of funds. The best point to start is the identification of the ethos. The ethos should inform the firm’s actions as it is more powerful than any advertisement that the entity may think of using to attract customers.

Marketing ethics in any organization calls for leadership from the top that is based on principles and purposeful actions among them planning of standards and their implementation, as well as, transparency and persistent effort aimed at improving the organization’s ethical performance. Ferrell C, Fraedrich and Ferrell L (2012), showcase several examples of cases of ethical concern and survey results that help paint a clear picture of the issues that are vital to business ethics. In their approach to ethical leadership and ethical decision-making, they consider emerging trends that determine the most relevant aspects (Murphy et al., 2005). For today’s companies, the ability to acknowledge and handle complex issues is of significant priority. Ethics contributes to employee commitment, customer satisfaction and trust, ethical culture, increased profits, and investor loyalty (Ellis et al., 2011). Their perception of the company as having an ethical culture influences their attitude towards it positively. The firm’s products get better reviews from customers in the market.

Implications and Gap Analysis

Current and past research offer deep insight into the subject of ethical marketing. However, there is still no universal model agreed upon to serve as a guide in conducting research on the issue. Many of them address the issue from a descriptive point of view. Empirical research is still not well explored. Future research needs to focus on ways of conducting empirical research to allow for a deeper analysis that can be backed by statistics and various derivatives. However, such research will only be possible after the development of ethical marketing models that guide empirical studies.

Conclusion

Evidently, current literature on the ethical marketing depicts the central role of ethics in the success of any company. Ethics is personal in nature, meaning that the perception of what is ethical may vary from one entity to the next. A business’ ethos carries with it great value than any other form of advertisement. Companies that have strayed away from a focus on their ethos and lost the understanding of who they are have in some cases wasted huge amounts of money on market promotion initiatives that do not bear meaningful results. One such is the green bandwagon that has seen companies implement green initiatives to appear ethical. Self-awareness is the most important step to building strong ethics in marketing. There lacks a universal model that would offer guidance on carrying out empirical research, a factor that has curtailed such studies. There is a need for increased investment into ethical marketing research if businesses hope to enjoy long-term profitability.

References

Arnold, C. (2009) Ethical Marketing and the New Consumer. Wiley; 1st edition.

Crane, A. and Matten, D. (2010) Business Ethics: Managing corporate citizenship and sustainability in the age of globalization, 3rd Edition: Oxford University Press.

Ellis, N., Fitchett, J., Higgins, M., Jack, G., Lim, M., Saren, M. and Tadajewski, M. (2011) Marketing: A Critical Textbook, Sage Publication.

Ferrell, C., Fraedrich, J. and Ferrell, L. (2012). Business Ethics: Ethical Decision Making and Cases. 9th Edition, South-Western College

Hunt, S.D. and Vitell, S. (1986), “A General Theory of Marketing Ethics,” Journal of Macromarketing, pp. 5-16.

Murphy, P.; Laczniak, G., Bowie, N. and Klein, T. (2005). Ethical Marketing, Pearson Prentice Hall.

Murphy, P.E., and Laczniak, G.R.(1981). “Marketing Ethics: A Review with Implications for Managers, Educators, and Researchers.” In Enis, B.M. and Roeing (Eds), Review of Marketing, AMA, pp. 251-256.

Schlegelmilch, B. (1998). Marketing Ethics: An International Perspective. International Thomson Business Press.

Tadajewski, M. and Brownlie, D. (2008). Critical Marketing – Issues in Contemporary Marketing, John Wiley & Sons: West Sussex, UK.