Ethical issue in Marketing related to Advertising - Essay Example

?Ethical Issues of Advertising Every business entity must market its products in order to convert its investments into revenue; however, in the of doing so, the firm must adhere to certain moral guidelines. Advertising is a not a new phenomenon, but recent developments have posed a dilemma to marketers in their quest to do ethical advertising. In addition, ethics means different things to different people and the high levels of competition today force many marketers to border on the unethical. A firm has to decide if it follows utilitarianism or a deontology approach in its advertising, as both approaches may result in significantly different results. Moreover, advertising must be done in such a way that it balances between profitability, social and environmental responsibility; a firm should make profits, but should not harm the community in which it operates and should not degrade the environment. Though there are many underlying factors, any firm that manages the balance between self, society and environment can be said to adhere to ethics of business practice (Hunt and Vitell, 2006: 145). There are numerous advertising media including the traditional television, radio, newspapers, mail and billboards, and the postmodern computer based internet advertisement channels including email, blogs, websites, programs and search engines among others. The increased number of advertising channels and methods of collecting data for advertising have pushed advertising ethics even further, and an advertiser has to be keen not to cross the line between ethical and unethical. In addition, personalised advertising that exploits various approaches to data mining is so effective that the persuasive and exploitative aspects of advertising have become a matter of serious concern to various stakeholders. This has been linked to the ethical aspects of consumer privacy that has resulted in the enactment of policies that provide guidelines on online data collection and use. However, these policies aim at forcing advertisers to do no harm, and advertisers have to decide if they just want to avoid harming consumers, or they would want to do some public good too (Hunt and Vitell, 2006: 148). The Advertising Standards Authority controls the content of advertisements in the United Kingdom, and the town and county planning system controls the content of outdoor advertisements. However, enforcement of advertising ethics goes beyond these bodies and extends to numerous independent consumer protection groups, and before advertising, a business entity has to predict the response that the advertisement is likely to elicit from these regulators. However, the regulators’ definitions of ethics are too broad, and the advertiser is largely responsible for the contents of advertisements (Hunt and Vitell, 2006: 150). Advertisement ethics is determined by the effects of the advertisement on the human, cultural, social, economic and political consequences of an advertisement on society. The aim of this term paper is to discuss the concept of marketing ethics as it relates to advertising. Background Information Common Advertising Media Advertising is the first communication between a firm and its prospective customers; therefore, the firm must do a decent job of it in order to have an impact and increase the likelihood of adverts translating to increased sales. Therefore, an advertisement must be designed create awareness, knowledge, liking, preference and conviction in a potential customer in order for him or her to make a purchase. Advertisers have always exploited the available media to the greatest extent, such that advertising accounts for a big portion of a firm’s expenditure. Traditional advertisements like radio are still in use today, though their use is reducing due to the emergence of more effective technologies that combine both the audio and visual components of advertisements (Kelley et al., 2011). Compared to other senses, visual reception causes the most impact on a person’s psychomotor system, which is why billboards and internet advertisements that display graphical still or moving images are successful. Television advertisements combine both visual and audio stimuli, hence are the most effective of adverts. Advertisers time their advertisements such that they coincide with the time that a consumer is most vulnerable to conviction to invest in the product being advertised. For instance, advertisements for holiday fairs are timed to coincide with holiday seasons, such that potential customers with resources to seek these services do not have an excuse to doing so. However, this form of advertisement timing is limited to broadcast media (East, 2003: 5). Direct mailing and online advertising use a behavioural advertising approach, whereby the advertiser uses various techniques to acquire data about the customer or potential customer and uses this data to personalise the advertisement in accordance to the target’s preferences. Therefore, when a person gets these advertisements, their contents are irresistible since they are tailored to his or her preferences, and the accuracy of the advertisement depends on the relevance and quality of data that the company used when designing the advertisement. Moreover, even if the subject of the advertisement is not among the recipient’s preferences, companies design the advertisements in such a way that a person with certain characteristics must be interested in an advertised product (Martin and Smith, 2008: 48). Theories Used in Advertisement Theory of the Unconscious This theory was postulated by Sigmund Freud (1856 - 1939), and he stated that people make decisions based, not of what they think in their conscious minds, but based on beliefs and perceptions that are deeply rooted in the subconscious. Advertisements exploit this characteristic of human behaviour by bombarding people with messages about products at every instant in their daily lives. People may not pay attention to these adverts, or so they think; and no one wants to admit that adverts have an effect on him or her. In fact, according to most people, advertisements do not affect them; they affect the people next to them (Kotler, 1972: 48). A person’s brain is configured in such a way that despite what one thinks about the information being delayed in advertisement, it will retain the information. As the advertiser uses various channels to sell a product, then an image is formed in the target’s subconscious about the product based on the advertisements, people’s opinions and the person’s perception of the product. However, as the person is bombarded with positive messages about the product from advertisements, his or her perception changes and he or she tries the product. If the advertisements were psychologically satisfying, then the person gets satisfied by the product quality even if it does not meet the standards shown in the advertisement. All this occurs without a person’s knowledge, and that is why advertisements are some of the most effective modes of communication (Luck, 1969: 61). Social Contract Theory Proponents of advertisements claim that advertisements are a reflection of society, especially since the theory of social contract assumes that every individual in a society has an obligation to society to promote certain values. One of the reasons why advertisements succeed in convincing people to purchase product is because advertisers use instances of the applicability of products in day-to-day life. However, due to increasing competition, advertisement extends the social contract theory and starts influencing human behaviour (Kotler, 1972: 52). A firm may advertise a product that promotes a certain aspect of normal society; after some time, the firm decides that the only way to have a competitive edge is to improve this characteristic, and a product is designed to do that, resulting in a change of society from its previous state. For instance, due to the need for personal hygiene, companies produced toothpaste to help people clean their teeth; but nowadays there are numerous firms selling toothpaste. Therefore, the firms come up with another derivative of toothpaste that is claimed to make teeth whiter that their natural state, which creates a need for people to have whiter teeth and the company sells its products. The social contract theory expects companies to protect the society in which it operates, and the extent to which firms do this determines their level of adherence to business ethics (Luck, 1969: 58). Utilitarianism Utilitarianism is a form of consequentialism, a genre of ethics that determines the moral value of an action depending on the results of an action. Utilitarianism expects advertisers to do their trade in such a way that the result is overall happiness to most people and harm to the least number of people. According to utilitarianism, it does not matter how a company does this, as long as the results of doing so are favourable. However, the consequences of actions are hard to predict, and even the best of intentions could have devastating results. Utilitarianism can take two approaches including not doing harm to consumers, competition and other stakeholders, and making an effort to do good to stakeholders. Therefore, it is the duty of an advertiser to pick the approach to take; doing good is the recommended approach, as avoiding harm is escaping from ones responsibilities to society (Nantel and Weeks, 1996: 15). Deontology Deontology has religious and non-religious aspects, whereby a person is duty bound to do what is expedient for the environment and society in which he or she operates. This theory of ethics expects advertisers to do their duty to society of protecting the people in the society, not due to their own choosing, but because they are required to do so. Deontology is the most recommended ethical approach for advertisers since they would only do their trade in accordance to legal, moral and other guidelines without exception (Nantel & Weeks, 1996: 15; Foley, J.P. (1999: 220). Characteristics of Advertisement Advertisement has several positive and negative aspects that result from advertisers attempts to be persuasive and exploitative, the two main characteristics of advertising. Advertisers sell dreams to people by showing them the perceived benefits of using their products; for instance, an advertisement may show people that life would be better and they will be happier if they acquire the product. However, this makes people to focus on the advertisers dream instead of living in reality, and though the product does not have the desired effect, people continue to use it in the hope that someday, they will experience the effects shown in the advertiser’s dream. In the example illustrated above, the new toothpaste may not whiten a person’s teeth, but since this is what the dream portrayed, a person continues using the toothpaste in the hope of having the desired effect after he or she has used the product for long enough. In addition, the person may even notice ‘changes’ where none exists due to the illusion created by the manufacturer (Boush, Friestad and Wright, 2009: 116). Advertisers cause people to desire more of the product by fuelling human desires with the promise of a better life if more of the product is used. For instance, though eating too much chocolate is unsuitable for one’s health, advertisements cause people to desire more by making the act of consuming more chocolate to be appealing. In addition, many people buy a product repeatedly even though it harms their health, economy or social lives; for instance, though Apple products have been proven to be of high quality, there are cheaper alternatives. However, since people have been convinced that no other product equal Apple’s products in functionality, they are ready to pay premium prices for a product that has alternatives that do not cost half its price (Boush, Friestad and Wright, 2009: 156). Most people buy products that they saw in a newspaper, television, internet or other advertising channels; and the desire to own the product becomes so much that a person’s life becomes unbearable without it. A person forgets that life was going on without the product, as advertisement has convinced him or her that he needs the product and life is incomplete without it; a characteristic of advertisement that makes people want things they do not need. Companies accomplish this by first creating a product, then advertising it in order to create a need for the product, which is illustrated in the toothpaste example above, or as seen in the invention of numerous products (Boush, Friestad and Wright, 2009: 123). Effects of Advertisement An ethical advertiser must be truthful about his or her product, which includes the negative effects of the product; however, advertisers have learnt to twist the truth such that truthfulness is no longer an adequate measure for ethically correct advertisements. For instance, in a certain advert for fast foods, the models are grossly overweight, which is fitting since it shows the negative effects of the product. However, these models are shown as ‘every day heroes’ including firemen and watchmen; therefore, though these advertisements seem ironical, people end up getting the perception that obesity is a desirable characteristic. Other ethics indicators for an advertisement include the effects of the product on the environment, human health, economy, politics, culture and social aspects of life (Waller, 2012: 50). Economic Effects The modern world has been characterised with increasing debt as people fulfil their desires by making purchases on credit, which was one of the contributing factor of the recession from which the world economy is still recovering. Advertisers make people perceive a need to own their dream homes, dream cars and other dreams, but since people do not earn enough, banks take advantage of the desires and entice people with loans to make purchases. This has resulted in an economy whereby most of the people live beyond their means, causing a high balance of payment deficit in the country and weakening of the currency (Sherman, Hunt and Nesiba, 2008: 227). Social Effects One of the most appropriate examples here if Apple’s marketing strategy, where its products have become a symbol of status; people who own apple products are considered to be in a class of their own. This results in further polarisation of society that already has social strata based on other differences. In addition, advertisements force people to obtain a certain product without thinking it through; especially if the model used in the advertisement is one with whom the people can identify. This strategy is commonly used by advertisers to target people of a certain age, where people believe that if one is of a certain age, then one must acquire a certain product (O'Guinn, Allen and Semenik, 2011: 121). Political Effects Advertisements can shift the people’s political perceptions and beliefs and cause them to make political decisions that are detrimental to their daily lives. For instance, if an unpopular candidate in a political race gets an effective advertising agent, people may be convinced to give their vote to him or her. The political results of advertisements range from choosing an ineffectual leader to civil strife like the Arab Spring that was fuelled by internet advertisements (Harris and Harris, 2009: 250). Cultural Effects The cost of advertising has become significantly low, especially due to the widespread use of online advertising, and it has become easier for advertisers of products of dubious nature to advertise their wares all over the world. The ease of access to consumers and efficient delivery methods have resulted in erosion of morals by unscrupulous traders. One crucial demerit of online advertising is that anyone can advertise, and the sheer size of the internet makes regulation almost impossible; therefore, if not done with caution, internet advertising can cause severe cultural problems. However, the internet is not the only culprit here; many firms use the basic human nature of sexuality and use sexually attractive models to advertise a wide range of products including dairy products, electronics, automobiles, and many more on billboards and television (Cuia and Yangb, 2009: 236). Human Health Effects Advertisements are mainly for legal products; however, not all legal products are suitable for human health including foods with high levels of hydrogenated oils, alcohol, cigarettes and other products. Nevertheless, advertisement makes using these products a pleasant experience and people use these products repeatedly despite their negative effects on health; in addition, some of these products are addictive psychologically, physiologically or physically. Advertisements have resulted in the high rate of obesity in the United States, binge drinking in the United Kingdom, and a high rate of cancer incidences related to use of nicotine among others (Brouwer and Ervin, 2002: 319). Environmental Effects Corporate social responsibility in many firms these days involves environmental conservation, in an attempt to reverse the effects of environmental degradation that has resulted from unsustainable practises. For instance, advertising has resulted in over consumption of fossil fuels in most technologies, which has in turn resulted in global climate change from the released greenhouse gases. Notable is the fact that many companies nowadays are wary of the impact of their carbon footprint and are taking environmental conservation measures (Brouwer and Ervin, 2002: 324). Ethical Considerations Advertisement has been subject to widespread criticism due to: Racial and sexual stereotyping in adverts Advertising of questionable products Advertisement of professional services Advertisement to vulnerable groups Deceptive adverts Emotional exploitation Psychological manipulation Privacy concerns Despite the characteristics and effects of advertising, many advertisers use the various media and apply theories of human behaviour to advertise to people, and psychologically influence their decisions when they are at their most vulnerable state (Smith and Quelch, 2006: 556). Stereotyping In the example discussed above, the advertisement on fast foods creates in the mind of the viewer the perception that people working as guards and fire fighters have to be obese men, which is a stereotype against people with such characteristics. In addition, it discriminates against slim men and women who are not perceived to be viable candidates for those job positions. One the other hand, some adverts create the impression that certain racial characteristics like twisted hair and coloured skin are undesirable and the product is the ‘remedy’ to such ‘bad’ traits (Eagle and Bruin, 2001: 260). Questionable Products Advertising companies have convinced people that using alcohol and tobacco is desirable, only for them to realise the ill effects of using the product later; however, at this stage a person is already addicted to the product and efforts to quit using it are fruitless. Other companies capitalise on people’s desire to overcome an addiction, and sell them products that are supposed to help them; however, in most cases this cure for addiction is usually another addictive product that aims at keeping the person going for more. Nonetheless, the new product may have a less negative effect on the individual than the original product, and an advertiser has to decide if it is worth to replace an old addiction with a new one (Goldberg, 2009: 57). The list of unquestionable products cannot be complete without including the advertisement of a product whose effect on human health is unknown, and its effect on the environment is destructive. Most synthetic products are relatively new, and they do not have enough research to justify their use; advertising such products is equivalent to doing research on people without their consent. The most common way that firms do this is by incorporating an ingredient that is not shown in the list of ingredients, or if they do, they use small fonts such that a consumer does not notice a warning (Dunne and Lusch, 2007:182). Professional Services High competition has caused many professionals to advertise their services; however, this does not make business sense because people need these services and skills are only possessed by professionals. In addition, when bombarded with many advertisements for health or legal services, people are at crossroads since they do not have a capacity to tell which professional offers better services. Therefore, people make choices on vital services based on the appearance of an advertisement, if a professional can get a decent advertisement and a few people to post testimonials, then he or she is likely to attract a stream of customers despite substandard skills (Bakir and Vitell, 2010: 310). Vulnerable Groups Young children and teenagers are in their early stages of growth and trusting, as they cannot differentiate between sincere advertisements and hoaxes. Moreover, even if these adverts were truthful, these young people are easily convinced into buying products they do not need, hence the current trend of advertisers targeting youth and children. Advertisers use their knowledge of psychology to entice children to desire and ask for their products, which is highly discouraged as it results unethical business practice. Other classes of vulnerable people include old people, the sick, and people with low self-esteem; advertisers capitalise on their vulnerability by promising products that will give them youth and long life, health, and high self-esteem respectively (Bakir and Vitell, 2010: 305). Deceptive Advertisements In most cases, advertisements are based on an exaggerated show of the advantages of using a product; rarely does an advertisement show mild benefits or give the disadvantages of using the product. Pharmaceutical industries encourage people to use over-the-counter drugs but do not warn users of physiological side effects, increased resistance, addiction and other demerits of using these drugs. Other manufacturers advertise their products but do not mention any disadvantage of using the product or the harm it may cause, a consumer is left to discover this on his or her own accord. For instance, some food companies include carcinogenic preservatives; however, these ingredients are concealed, and a customer discovers the folly after using the product for years (Dunne and Lusch, 2007: 182). Emotional Manipulation It is natural for people to want to be happy among other positive emotions, and advertisers use this as a basis to sell their products, promising that the product with bring happiness to its users. However, this is not usually the case, but users are conditioned to believe that if the product does not deliver the promised happiness, then enough has not been used, and a person has to buy more to become happier. This happens for all emotions and could last for years, but the result is usually frustration, and the advertiser comes up with another product that is said to work better and faster than the first one. The manufacturer makes profits, and the customer lives in the hope of getting the desired emotion from the product (Eagle and Bruin, 2001: 265). Psychological Manipulation Psychology has taught manufacturers about the thinking patterns and behaviour of people, and they exploit this knowledge to cause people to think certain thoughts and have certain desires that manufacturers exploit to sell their products. For instance, most people long for a sense of belonging, high esteem, and want to be valued; manufacturers align their advertisements with these needs and offer products that promise to satisfy them. Sometimes people get satisfied by the products, but since the satisfaction is based on material products, then they have to keep buying the product to sustain the satisfaction, which benefits the manufacturer (Eagle and Bruin, 2001: 270). Privacy Concerns This is the greatest cause of concern for online advertisers, and there have been controversial policies that aim to ensure that customer data collected in an online is not accessed by unintended parties, and consumers can choose how they want their data to be used. Data collected in online sources may include behavioural data or identification data, both of which are a compromise of the privacy of an internet user if the advertiser does not ask for the user agreement before collecting the data. The recent incident of hacking on Facebook and Blackberry services shows the risk of placing personal data in online data storage services. Collecting of data and tracking a person’s browsing habits is a strategic approach in personalisation of adverts, but the definition of ethics in this case depends on the advertiser (Youn, 2009: 392). Regulation and Enforcement of Advertising Ethics In the United States and the United Kingdom, Federal Trade Commission and Advertising Standards Authority respectively are the main regulatory bodies that aim to protect consumers by ensuring that advertisements do not contain undesirable content. These bodies do so by the use of acts, policies, standards and codes that require adverts to be legal, truthful, decent, fair and honest. On online privacy, these bodies aim to assure users that their data is collected in a transparent manner, they have a choice of opting out of giving their personal data to websites, the data integrity is retained, and it is secured to prevent unauthorised access (Brennan, 1991: 12). However, these bodies are not enough, especially due to the variety and number of advertisements to be controlled; every user should bear personal responsibility for the consequences of using online services. On the other hand, advertisers should use their judgement to decide the fair way to advertise, and go beyond the regulator requirements by practising responsible corporate social responsibility. Therefore, the only way to overcome the ethical concerns related to advertising is by self-regulation, which is why many disciplines incorporate an ethics-related subject to promote the culture of taking responsibility for the ethical consequences on one’s actions (Stuhlfaut and Farrell, 2009: 177). Conclusion Advertising is a core activity in the marketing practice, and like every other aspect in life, it is faced with ethical questions for which no one seems to have an answer. The availability of numerous advertising channels has increased the number of ethical concerns relating to the content, audience and other characteristics of advertisements. Over the years, advertisers have used theories of human behaviour to increase the persuasive appeal of adverts; however, that is nowadays seen as manipulation, and an advertiser has to balance between profitability and ethical practise. 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