Marketing Ethics

Basic principles and values that govern the business practices of those engaged in promoting products or services to consumers. Sound marketing ethics are typically those that result in or at least do not negatively impact consumer satisfaction with the goods and services being promoted or with the company producing them.

Ethical marketing is less of a marketing strategy and more of a philosophy that informs all marketing efforts. It seeks to promote honesty, fairness, and responsibility in all advertising. Ethics is a notoriously difficult subject because everyone has subjective judgments about what is “right” and what is “wrong.” For this reason, ethical marketing is not a hard and fast list of rules, but a general set of guidelines to assist companies as they evaluate new marketing strategies.

Principles of Ethical Marketing

• All marketing communications share the common standard of truth.
• Marketing professionals abide by the highest standard of personal ethics.
• Advertising is clearly distinguished from news and entertainment content.
• Marketers should be transparent about who they pay to endorse their products.
• Consumers should be treated fairly based on the nature of the product and the nature of the consumer (e.g. marketing to children).
• The privacy of the consumer should never be compromised.
• Marketers must comply with regulations and standards established by governmental and professional organizations.
• Ethics should be discussed openly and honestly during all marketing decisions.

There are distinct advantages and disadvantages to ethical marketing. Unethical advertising is often just as effective as it is unethical (See alsoBlack Hat Marketing). And since unethical behavior is not necessarily against the law, there are many companies who use unethical advertising to gain a competitive advantage.

Many people buy diet pills even though they are rarely, if ever, effective. This is because some diet pill companies use exaggerated and manipulative claims to essentially trick customers into buying these products. If that same company committed to using ethical advertising they would probably go out of business. However sneaky their business model may be, it is not illegal and it is keeping their doors open.

For companies looking to improve the image of a brand and develop long-term relationships with customers, this kind of unethical behavior can quickly lead to failure. Customers do not want to feel manipulated by the brands they like. Companies can use ethical marketing as a way to develop a sense of trust among their customers. If a product lives up to the claims made in its advertising, it reflects positively on the entire company. It can make the consumer feel like the company is invested in the quality of the products and the value they provide customers.

It is impossible to claim that any company is completely ethical or unethical. Ethics resides in a gray area with many fine lines and shifting boundaries. Many companies behave ethically in one aspect of their advertising and unethically in another.

Dove soap, for instance, ran a widely seen ad campaign featuring “real” models. The ad was meant to promote realistic body images and encourage girls to love the way they looked even if they were not supermodels. However, other Dove ads both during and since featured stereotypically beautiful models whose images have been altered to hide imperfections. Dove marketed ethically in one campaign and unethically in another. This illustrates how difficult it is to do the right thing in all circumstances. What is most important for any company that claims to practice ethical advertising is to make it a fundamental feature of their marketing process. With every decision they must ask themselves “will this sell” and “is this the ethical way to sell it?” (See also Consumer Psychology)

Who Employs Ethical Marketing?

Every company has the opportunity to engage in ethical marketing. Any business, from the smallest mom and pop store to the biggest multinational corporation can choose to be open, honest, and fair when they advertise to their customers. When done in a thoughtful way, ethical marketing can be an economical and effective form of advertising. Similarly, unethical advertising doesn't guarantee higher sales or lower advertising costs.

Some companies operate according to lofty personal principles. For these companies, advertising in an ethical way is a natural and necessary extension of their corporate character. Corporate responsibility can be a major selling point to consumers who are interested in more than just price and quality. Companies that are known for treating workers fairly, sourcing sustainable materials, environmental stewardship, and charitable donation have to reflect these principles in their marketing efforts. .

For other companies, ethical marketing will be little more than an opportunity to boost their credibility. Domino's pizza, for example, carried out a well known advertising campaign in which they showed consumers pictures of real Domino’s pizzas without the studio photography that makes them look so perfect. This was a refreshing look behind the artifice of much advertising, but this did not signal a more open and honest relationship between Domino's and the pizza buying public. The campaign was considered an attention seeking stunt at best.

Types of Unethical Advertising

• Surrogate Advertising – In certain places there are laws against advertising products like cigarettes or
•  alcohol. Surrogate advertising finds ways to remind consumers of these products without referencing them 
• directly.
• Exaggeration – Some advertisers use false claims about a product's quality or popularity. A Slogan like
•  “get coverage everywhere on earth” advertises features that cannot be delivered.
• Puffery – When an advertiser relies on subjective rather than objective claims, they are puffing up their 
• products. Statements like “the best tasting coffee” cannot be confirmed objectively.
• Unverified Claims – Many products promise to deliver results without providing any scientific evidence.
•  Shampoo commercials that promise stronger, shinier hair do so without telling consumers why or how.
• Stereotyping Women – Women in advertising have often been portrayed as sex objects or domestic servants.
•  This type of advertising traffics in negative stereotypes and contributes to a sexist culture.
• False brand comparisons – Any time a company makes false or misleading claims about their competitors 
• they are spreading misinformation.
• Children in advertising – Children consume huge amounts of advertising without being able to evaluate it 
• objectively. Exploiting this innocence is one of the most common unethical marketing practices.

How is an Ethical Marketing Plan Developed and Implemented?

Ethical marketing doesn’t refer to a plan in and of itself, but offers tools for companies to evaluate the marketing strategies they use in the past, present, and future. If a company decides that an ethical marketing strategy can increase their profits or advance their public image, they can take steps to revise their existing marketing (See also Public Relations Specialist). In some cases this involves minor changes; in others it will require entirely new ad campaigns.

Any ethical marketing effort will begin with a careful analysis of the company, its customers, and the markets it operate within. Ethical marketing has many advantages, but few companies would undertake an ethical marketing strategy if it reduces profits. Careful research is the best way to predict the effects of a change in strategy. If ethical marketing proves to be cost prohibitive, many companies will abandon the effort.

A company will then decide which features of their advertising to perform in ethical ways. As previously mentioned, the field of ethics is notoriously abstract. What is right to one may be wrong to another. Marketing professionals must reach an agreement about how they want to deliver their campaigns. They might decide to focus on making honest claims, avoiding marketing to children, or falsely criticizing competitors. A delicate balance has to be struck between the truth of the ad and its ability to persuade the customer.

Finally, ethical marketers need to make difficult choices about how to leverage the capitol of their ethical decisions. For most companies, the simple knowledge that they are doing the right thing will not be enough of a motivating factor. Ethical marketing often highlights the ethical choices a company has made in order to improve their public reputation. This can be a powerful way to connect with customers, but it also runs the risk of seeming self congratulatory. Any effort at ethical marketing has to balance a company’s self interest with their social responsibility.

One company which embodies the spirit of ethical marketing is The Body Shop, a worldwide chain of bath and body stores. Since their inception they have been committed to treating workers fairly, avoiding animal testing, using organic products, and promoting healthy body images. These values are often at the center of their marketing efforts. The ethical nature of the company is highlighted as a way to differentiate themselves from their competitors in the cosmetics industry.