Societal Marketing and Its Importance - Newmont Mining Corporation - Case Study Example

SELLING APPROACH TO SOCIETAL MARKETING Name Institution Date Introduction The selling approach proposes that customers cannot buy enough products from the organization unless they are persuaded to buy through selling efforts. It assumes that under normal circumstances, customers will show resistance and thus they should be persuaded into buying. It also assumes that companies should use effective promotional tools to stimulate more buying. These marketing strategies are effective in motivating the customers' inert need into a buying motive through persuasion and selling action. For this reason, firms must undertake an aggressive selling and promotion effort. Today, many organizations have realized the benefits of shifting from selling approach to a good cause concept that benefits the society. They have recognized that giving back to the society by ensuring their products or services improve the customer's welfare result in a better firm performance. Good cause practices help in building a high customer loyalty that in the end help in achieving growth (Westberg 2006). This is the newest marketing philosophy that questions whether the selling approach is adequate given the wide variety of societal problems. Advocates of societal marketing concept fail to consider long-run consumer welfare. This paper will discuss societal marketing, its importance, and cases where firms have employed societal marketing concept. What is Societal Marketing? The societal marketing concept is based on the assumption that firms should concentrate on the needs and want of its customers, and then ensure that they meet their demands effectively and efficiently compared to their competitors, thus improving the customers and society wellbeing. Profit is a major business motive, social marketing advocates for maintaining good practices that do not harm the society and fairness to consumers. The societal marketing concept brings corporate social responsibility (CSR) in marketing practices (Hoeffler & Keller 2002). CSR means that a corporation should be accountable for their actions that have an impact on the environment, people, and the community. It is a practice where the firm puts an effort to be socially responsive and responsible in the provision of goods and services that suit the needs of the consumers. Societal marketing also considers possible conflicts between to customer’s short-run wants and long-run consumer welfare, as it is profitable and sustainable in the long-run as opposed to other concepts. This argument of adopting societal marketing is based on the assumption that customers are more sensitive in the world today as there are many available choices to meet their needs and wants. Consequently, firms use the concept of taking care of society's well-being as a competitive advantage. Firms that use societal marketing approach believe that a consumer responds favorably to socially responsible companies and unfavorably to companies that are not socially responsible. Many organizations have realized that a business should go beyond profit, and it has a responsibility towards the society. Furthermore, for the firm's product to be sustainable in the long run, a firm should focus on adopting concepts that focus on consumer and society welfare in the long run. In other words, organizations should adopt marketing concepts to ensure sustainable development in the society. Firms that have adopted societal marketing approach have seen increased sales and revenues. Furthermore, the practice is helped to not only influence the consumers but also the stakeholders. For instance, if a firm is socially responsible, the level of counterproductive behaviors among the employees also reduces. Research has also shown that socially responsible practices may make the company more attractive, thus appealing quality workforce. Moreover, this approach creates good attitude among the employees towards the organization. Effects of Societal Marketing Literature shows that consumers shows positive image towards an organization that engages in socially responsible practices, and may prefer to buy a cause-related product (Hoeffler & Keller 2002). Moreover, if the prices are equal with products of companies that do not engage in socially responsible practices, consumers are more likely to switch to a brand or a company associated with the socially responsible practice. A majority of consumers believes that this concept should be the way of doing business. As a result, it improves the brand's image because most companies prefer company advertising with a social claim. Furthermore, there is a positive correlation between societally marketing practices and positive financial performance. In fact, firms that make it public commitments to be ethical performed better financially that those that did not do so. Example of Companies using Societal Marketing Today companies have realized that societal marketing concepts can improve the brand reputation. Engaging in socially responsible activities is good for the business as it results in improvement of brand image and increased profit. Newmont Mining Corporation Newmont Mining Corporation became world's largest gold producer in 2002. It operates in four countries United States, Australia, Peru, and Ghana. Newmont recognizes that social responsibility is essential to the company. Newmont Mining does not consider social responsibility as anathema to profitability but as a sign of intelligent foresight in the long run. Newmont executive noted that long-term investors focus on companies with strong CSR policies because they are more sustainable than firms that have instant high returns (Batters 2008). The Corporation has demonstrated its efforts by building relationships that are based on adding value to the communities. For Newmont, good relationship with the communities aims to reduce trouble around resources and provide shared value solutions for businesses and communities. For example, improvement of infrastructure or construction of water purification plants to prevent long term issues is part of decision making in a project. Newmont had identified a local community need for more affordable energy supplies in the Northern Territory, Australia. The company is working with local authorities to purchase supplies at lower cost and is also proposing to install solar project. Newmont has a more buying power compared to the local authority working alone. Also, the Ninga Mia community that resides near Newmont KCGM joint venture operation has benefited from a joint partnership between in signing the "Dignity, Respect and Fulfillment Agreement" with the community. This agreement helps in creating a better working relationship between the indigenous and non-indigenous leaders and other individuals. Since mining process poses a risk to the environment, the company must ensure that it is well managed to ensure that environmental hazards are reduced to a greater extent. Newmont has significantly reduced emissions of mercury and sulfur dioxide to the environment by replacing the roaster with an ultra-fine grinding mill at KCGM in Australia. Newmont has also undertaken water conservation strategies, for example, at KCGH operations saline and non-potable water is used for the plant operations such as sea water at Batu Hijau. This helps to reduce usage of fresh water that can be utilized by the community. Additionally, the sea water is also recycled and reused in the ore processing. In fact, Boddington operations in Australia have currently considered zero discharge mines that emphasize on striving the balance makeup water with actual process needs. The Body Shop Australia The body shop International ply operates in approximately 27 countries. It is known as an original, natural and ethical brand. Body Shop Australia started its operation in Melbourne, 1993 when the first store was opened. Today, there approximately more than 90 stores across Australia. Body Shop has integrated the societal making into the culture of the organization. The company sees it as a way in which they can strengthen its reputation, financial performance, publicity, customer loyalty as well as raise its brand awareness. The body shop was among the initial organizations against animal cruelty, where animal are used to test for products. In fact, it was the first global cosmetic brand to be awarded the Humane Cosmetics Standard when it implemented a policy against animal cruelty. Advancement in technology such as tube testing has played a crucial role in protecting animal rights. Additionally, Body Shop has been a leader in supporting community trade. It has started a fair trade program that helps to create trade where all the people involved can utilize the available resources to meet their personal needs. This is a reflection of fair trading that allows the surrounding communities to sell their products at a fair price so that they can meet their need. As a result, the company meets its demand for ingredients in a fair way by creating a sustainable trading relationship with marginalized communities. The company also used plant-based materials for its products. The Body Shop is known for fair-trade, and for protecting our ecosystem as their products have plant materials fragrance. It is now certified by Ecocert as a natural cosmetic manufacturer, with its organic range (Bray 2015). The company also has campaigned for gender equality and against domestic violence. It has been in the forefront in raising awareness and supporting human right organization. The Body Shop has also vowed to protect the environment. Besides using natural ingredients such plant raw materials, customers are also encouraged to reuse the plastic containers (Andrew 2016). Despite being a large consumer of the forest, but at the same time, it has cooperated with forest councils to protect and maintain the balance in forests. Conclusion Societal marketing is gaining attentions in today's business worlds among both the consumers and organizations. It focuses on adding shared value to all stakeholders to the society and the firm. For societal marketing to be effective, it must provide the consumers with compelling benefits and increase their wellbeing. References List Andrew R April 2016, "The Body Shop gives itself a makeover to repair battered margins", The Sydney Morning Herald, viewed Batters, L March 2008, "Corporate responsibility 'a core element", The Sydney Morning Herald, viewed < http://www.smh.com.au/business/corporate-responsibility-a-core-element-20080319-20ia.html> Bray, K August 2015, Natural and organic cosmetics: Are you getting what you think you're paying for? Choice, viewed , Hoeffler, S & Keller, KL 2002, "Building Brand Equity Through Corporate Societal Marketing", Journal of Public Policy & Marketing, Vol. 21, no.1. pp. 78–89. The Body Shop Australia http://www.thebodyshop.com.au/about-us.aspx Westberg, K 2006, The Effect of Corporate Societal Marketing on Consumer Attitudes: A Comparison of Strategies, RMIT University, viewed Read More