MKT 230 1st Edition Lecture 6Outline of Last Lecture I. Business Unit Strategya. Mission Statementsb. Corporate Strategyc. Business Unit Strategyd. Marketing Strategyi. SMART ObjectiveII. Marketing Plansa. Customer Relationship MarketingIII. Internal MarketingIV. Marketing ActivitiesOutline of Current LectureI. Social Responsibilitya. Marketing Citizenshipsb. Pyramid of Corporate Social ResponsibilityII. Marketing EthicsCurrent Lecture – Monday, February 2, 2015I. Social Responsibility – an organization’s obligation to maximize their positive impact and minimize its negative impact on society- Being a good corporate citizen can result in greater consumer trust and loyalty- Positive publicityThese notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.- This can have indirect long-term benefits like: talking points for customers, appealing to customer values- Example: Walgreens Best Corporate Citizens – ‘13- Ranks companies based on their effects on the environment and climate change, human rights, employee relations, corporate governance, philanthropy, and finance1. Looks at how the company is ran, what effect it is having on the world, what they are doing to help, etc. Marketing Citizenship – adoption of a strategic focus for fulfilling the economic, legal, ethical, and philanthropic social responsibilities expected by stakeholders Marketing Citizenship Affects Stakeholder Groups- Customers are affected: gain long-term customers, retain customers, positive word of mouth, positive product evaluation, enhanced corporate reputations- Marketing channel member are affected: trusting relationships, long-term partnerships, enhanced efficiency in communications- Employees are affected: improved self-concept, reduced absenteeism, creates a sense of pride Pyramid of Corporate Social Responsibility- Philanthropic – be a good corporate citizen- Ethical – be ethical, do what is right- Legal – obey the law- Economic – be profitableII. Marketing Ethics – principals and standards that define acceptable conduct in marketing as determined by various stakeholders- The most basic of these standards have been codified into laws- Ethics come from personal experiences – How was I raised- Managers have a significant effect of the ethics of their business Ethical issues: an identifiable problem, situation or opportunity requiring a choice among several actions that must be evaluated as right or wrong and ethical or unethical- These can occur in all factors of the marketing mix1. Product – product information: covering up something that could harm the customer or sway their purchasing decision, or a product recall: when customers have to return the product because of a defect2. Distribution – counterfeiting: making a fake product but selling it as ifit was real3. Promotion – greenwashing: making a product appear to be very eco-friendly when it is not, or bribery: advantages that come out of illegalexchanges4. Pricing – price gouging: pricing something extremely high to take advantage of customers who need the product, or bait and switch: get the customer interested with a product that isn’t expensive then switch them to a more expensive product Corporate Philanthropy- Cause-related marketing – practice of linking products to a particular social cause on an ongoing short-term basis1. Example: box tops or Toms shoes (you buy a pair and they give a pair to a person in need)- Strategic Philanthropy – synergistic use of organizational core competencies and resources to address key stakeholders interests and achieve both organizational and social benefits- Sustainability – potential for long-term well-being of the natural environment, including all biological entities, as well as the interactions among nature and individuals, organizations, and business strategies- Consumerism– efforts of an independent individual, groups, and organizationsto protect the rights of consumers1. Interests groups and individuals take action against the companies they consider by lobbying, letter and email writing, campaign boycotts and public service announcements2. How firms handle customer complains affect consumer evaluations, customer satisfaction, and loyalty3. Example: Discover is very good at disputing customer complaints in a timely, polite, and helpful manner Community Relations- Marketers play a role as community members. They can help improve the community in a number of ways1. Providing employment opportunities2. Helping with economic development3. Making financial contributions to education, health, culture, and other causes- Ethical Issues can become a problem in all elements of the marketing mix- Marketers must be able to recognize the problems and solve them Factors that Influence Ethical Decision Making Process in Marketing- Individual factors, opportunity, and organizational relationships- Opportunity is key in decision making, people will weigh their personal opportunities versus the penalties they could incur- To improve ethical conduct in marketing, there are three factors that need to be considered1. Codes of Conduct2. Ethics Officers3. Implementing Ethical and Legal Compliance Programs- Ethical conduct will improve when these three factors are met Social Responsibility and Ethics Improve Marketing Performance- Long-term, companies will succeed if they do the right