Marketing ethics is the systematic
study of how moral standards are
applied to marketing
decisions, behaviors, and institutions.
Ethics of Marketing
Marketers must not knowingly do harm in
carrying out their selling responsibilities.
They should embrace basic marketplace
values, including truth telling, genuine service
to customers, avoidance of practices
acclaimed to be unfair, and an adherence to
honest and open communications with clients.
Most general areas of marketing practice provoke
substantial ethical comment and discussion.
These areas include:
Ethical questions especially surround the target
marketing of segments that include potentially
vulnerable populations such as children, the
elderly, the impoverished(poor) ,and marketing
illiterates. For example:
Children are a $25+ billion market in the United
States alone for products such as toys, sugared
cereal, DVDs, and video games.
If a company markets its products to an
uneducated customer base that is not aware of
the serious consequences of a certain
product, such as selling cigarettes in developing
countries, that’s an ethical issue that needs to be
addressed. If they are not aware of these issues;
therefore it is morally wrong to sell them
Similarly for older kids, the ethical issues might focus
more on the appropriateness of certain products
(violent video games), or the degree to which young
teenagers might be inclined to particular kinds of
provocative fashion or lifestyle advertising.
The key issue involved in targeting children turns on
whether marketers should be held to a higher
standard care and caution when marketing to children.
During research process it is the
responsibility of researcher to keep the
information secret which he collects from
respondent. Misuse of this info creates
unethical issue in marketing.
Ethical issues surrounding the management of
products are central to marketing because the
marketing process generally begins with a
product (broadly defined to include
goods, services, or ideas).
The most common ethical concerns in this
area pertain to the safety of products are safe
"for their use as intended" is a basic consumer
Another growing area of concern is product
counterfeiting(copy of original). Product
counterfeiting involves the unauthorized copy of
patented products, inventions, and trademarks or
the violation of registered copyrights (often for the
purposes of making a particular product look like a
more popular branded leader).
Common examples of product counterfeiting
include fake Rolex watches, knockoff Levi
jeans, and illegally pirated video and audio tapes
of popular movies and music.
Perhaps no area of managerial activity is more difficult
to assess fairly and to prescribe normatively in terms of
morality than the area of pricing.
Price gouging is an example of an unethical pricing
strategy. A company may raise prices of items that are
temporarily in high demand. This is sometimes seen in
the wake of emergency situations when the price of
plywood jumps after a flood, even though there is
enough plywood to repair houses.
Predatory pricing, on the other hand, involves
pricing a product low enough to dampen demand.
This type of pricing is typically used to end a
competitive threat. The company lowering the
price is operating to protect market share from
moving to the competition.
Selling counterfeit goods, such as
watches, handbags and designer athletic shoes at
the same high price as the "real" goods, is
another example of an unethical strategy.
Price fixing, price skimming, price discrimination
are also the examples of it.
The distribution element of marketing involves the
entire supply chain from manufacturer through
wholesalers and distributors (including retailers) on to
the final consumer. At each point in the supply
chain, because there are economic interactions
between these various parties, the potential for ethical
issues to occur is quite common.
Power and Responsibility
Perhaps the most severe issue within the
channel of distribution supply chain has to do
with the question of power and responsibility
within the channel itself. Often one
organization within the channel has greater
economic leverage than other channel
members, and with that economic leadership
comes a potential for ethical abuse.
Powerful supermarket chains often demand
payments from producers (allowances) to
ensure that their products will have shelf
space in supermarkets. Many supermarket
operators also demand pay-to-stay fees
payments to supermarkets by producers to
keep their products on the shelf.
On the other hand power full manufacturer
may take advantage from small retailers.
Another common concern within channel
relationships has to do with "gift giving" that
sometimes transforms into bribery. A long-
standing business custom is to entertain
clients and to give modest gifts to business
associates. Such practices can cement
important economic relationships.
The grey market also raises ethical issues. The
grey market is unauthorized intermediaries that go
around authorized marketing channels by buying
in low-price markets and reselling in high-price
markets at lower prices than those charged by
authorized channel members.
Many consumer packaged goods including
toothpaste, bath soap, and deodorant are often
purchased in the grey market.
There are number of ethical issues in personal
selling. The first one that comes to mind is the
manipulation of potential customer, Some
salespeople are pushy and make unrealistic
claims about product and give improbable
(unbelievable, impossible) guarantee.
Like wise some sales people give gifts ,money
or favor in exchange of purchase.
Now a days we normally observe that advertising
industry also has some unethical issues.
Manufacturers or businessmen do not follow
strictly code of morality of society as well as
In Pakistan we may also see many ads do not
show Pakistani culture or our most respectable
religion Islam. Islamic values we have forgotten.
Vulgarity, women exposition, etc. are very
common examples of it.
Code of Ethics in Advertising
No advertisement shall be permitted which
(a) promotes or supports rabble-
rousing, anarchy(revolution) or violence in country;
(b) is against any provisions of the Constitution of
Pakistan or any other law for the time being in force;
(c) tends to motivate people to crime, cause disorder
or violence or breach of law or glorifies violence or
obscenity in any way;
(d) glorifies adultery, lustful
(immoral, shameless) passions or alcoholic
drinks or the non Islamic values;
(e) distorts(alter) historical facts, traditions of
Pakistan or the person or personality of a
national leader or a state dignitary;
(f) promotes social inequality, militates against
concepts of human dignity and dignity of labor.
(g) is directed against holiness or home, family
(h) is wholly or mainly of a religious or political
(i) contains indecent, vulgar, or offensive
themes or treatment; or
(j) contains material which is repugnant to
ideology of Pakistan or Islamic values.