The Marketing of Products and Services - Essay Example

In the 20th century the business world placed a high emphasis in the ability of company to produce vast quantities of products at the lowest possibleprice in order to increase profits. The marketing of products was based on offering customers a quality product at the best possible price. The service industry followed similar values which illustrate a simplistic view of the responsibilities of the firm towards the community. The business entities did not focus on serving the needs of the community beyond selling or providing a service to the customer. The world has changed and in the 21st century corporate responsibility and sustainable business practices are important elements that should be an integral part of a company’s strategy. This paper analyzes and studies business sustainability in order to determine if the subject should be included in future business textbooks as an important business discipline that students should educate themselves on. Sustainability are the policies and processes which enhance the financial, environmental, societal, human and other resources on which the company depends for its long-term health (Economic Intelligence Unit). It involves a major commitment from a company in order to satisfy the needs of its internal and external stakeholders as well as placing a high level of importance in mother earth. The practice can not be applied through a single linear approach, since in order for sustainability in the business world to be effective a company must apply an integrated approach throughout the enterprise. The globalization movement made companies around the world located in different location and societies realized that the actions of companies affect the global economy. Since the turn of the century companies have made sustainability a priority. Executive are utilizing a strategic approach called corporate responsibility in order to attend the sustainability issue. Corporate responsibility is the continuing commitment by businesses to behave ethically and contribute to the economic development while improving the quality of life behind the workforce (Corporate-responsibility). Sustainability can help companies increase their profitability and shareholders value. The principles of sustainability state that the long term results are more important than short term gains. An example of how the principle of sustainability affects the corporate the case of Nike apparel. Nike Corporation in the late 1990’s incurred in unethical human labor practices in developing nation by establishing sweatshops which are places in which laborers are overworked are forced to worked inhumane hours at very poor conditions for very low wages. In 1997 Nike was subject to a considerable scandal when it was revealed contract factory workers were being exposed to toxic fumes 177 the Vietnamese legal limit (Connor). Such a move for Nike increase their short term gain, but when the media found about their practices the company received a lot of bad publicity which cost the companies a millions of dollars in sales in long run from public relations expenses, lost sales and loss of valuable customers. The marketing of products and services can be geared to follow an approach aligned with business sustainability. One of the major marketing philosophies is the societal marketing concept. The societal marketing concept sidesteps the potential conflicts among customer wants, consumer interests, and long term societal welfare (Kotler 26). This implies that a company provides products and services to achieve the greatest customer value while at the same time meeting societal needs. One category of products that serve this purpose is green products. A company that has utilized sustainability as a major strategy that allowed the firm to differentiate itself and achieve global dominance is Starbucks Corporation. Starbucks Café is the world largest retailer of coffee drinks with over 15,000 stores worldwide (Starbucks). This firm incorporates the socially responsible practice of Fair Trade Coffee as its catalyst strategy that allowed the firm to become a multibillion dollar empire. Fair Trade (FT) is a business application that brings awareness about the bad working conditions of farmers in developing nations and provides solutions which include higher wages for farm workers, better working conditions, and community involvement while at the same time guaranteeing the farm owners a price per pound that is twice as much as the going rate for coffee in the global marketplace. The minimum price for wholesale fair trade coffee is $1.26 per pound. (GlobalExchange). Sustainability practices at this company are visible throughout its supply chain. The FT coffee strategy used by this firm guarantees the firm a top quality product which is why the coffee drinks the store are better than competing brands. The Starbucks case shows that sustainability can increase corporate profits and helps the long term growth of corporations. Sustainability practices includes different business practices and areas such as community relations, the supply chain, improving working conditions, process improvements, recycling initiatives, lowing pollution levels, reduction in production wastage among others. The actions of companies affect the communities which they serve. One tragic example of the impact and the consequences of the actions of corporation and how they may impact the environment and the well being of its surrounding communities is the disaster that occurred in Bhopal, India associated with Union Carbide Corporation. This company did not follow safety protocols which caused an explosion and gas leaked which contaminated the region and caused the death of over 10,000 in a few months and over 100,000 deaths in the long run. The past behavior and attitude of corporation leave a lot to be desired and in today’s business are no longer acceptable. There is greater urgency for more companies to follow sound sustainability strategies due to the world tendencies that have become ore imminent during the last couple of years. The natural resources of the world are being depleted at an accelerated rate which is causing inflationary forces in major sectors. One of the biggest crises right now in the world is the energy crisis. During the last two years the petroleum which have always had an upward spiral demonstrated very high inflationary forces which effected the worldwide production since costs when up especially in the food market sector which is the primary need of human being for their survival. The laws of supply and demand are at work here since there is shortage of crude oil worldwide, thus in order to minimize the effect logic states that lowering consumption is a good way to stabilize prices. The biggest consumers of energy around the world are corporations. There are millions of corporation worldwide and these firms need to realize that everything counts and that they are expected to act socially responsible way. A study called the State of Green Business 2008 demonstrated based on a 20 indicator scorecard that corporate green efforts in 2007 showed progress in only 8 of 20 metrics (Madrigal). Business sustainability requires firms to follow a high ethical standard since without it chaos can easily manifest itself. Ethics is behavior that is accepted as morally good or bad which for corporations implies following social responsibility which is the obligation of organizations to behave in ethical and moral ways (Schermerhorn, et al. 14). The American Management Association in 2008 prepared a forum on the sustainability paradigm. As part of the study a survey of 1365 corporations worldwide was performed that revealed that the most important sustainability issue was business ethics and integrity (Clayton). Sound business ethics allow companies to follow environmental guidelines, to comply with business laws and to care about the well being of the stakeholders. This report clearly shows that sustainability is an important business concept that has to be studied by students of all disciplines. Business students in particular have to learn about the topic since its importance in the corporate world has gone up significantly. The actions of corporations are being closely monitored by customers worldwide. The people now expect the private industry to reach out to the community and to become actively involve in solving the problems our society is facing. In many ways corporation are partly responsible for many of the illnesses of the world such as global warming, pollution, and natural resource scarcity. A managerial textbook should include one of two chapters on the subject and throughout the literate there should be references to sustainability since the subject matter is associated directly and indirectly with many other business principles. The importance of sustainability in the business world has expanded the scope of business reports. Many multinational companies such as Starbucks now prepare as one of their primary reports annual corporate responsibility reports. In the past the annual report had a page or two in the subject, but now the customers expect greater accountability and they want to know what the company is doing to help the people and the planet. The concept of corporate sustainability and its related practices will continue to expand and become more important. The corporate world needs professionals who are educated on the subject so that employees can become solution makers to the many sustainability issues that we are facing today and the many others issues that will appear in the future. References Clayton, P. 2008. “Sustainability: An evolving business paradigm.” American Management Association. 29 August 2008. Connor, T. May 2001. “Still Waiting for Nike to Do It” 29 August 2008. Corporate-responsibility.com. 2008. “What is Corporate Responsibility.” 29 August 2008. Economic Intelligence Unit. 2008. “Doing Good Business and the Sustainability Challenge.” 29 August 2008. Globalexchange.com. 2007. “Fair Trade Coffee.” 29 August 2008. Kotler, P. 2002. Marketing Management (11th ed.). New Yersey: Prentice Hall. Madrigal, A. 1 January 2008. “Sustainability Scorecard Shows Green Business Has a Long Way to Go.” Wired. 29 August 2008. Starbucks.com. 2008. 29 August 2008. Schermerhorn, J. and James, H. and Richard O. 2003. Organizational Behavior (8th ed.). New York: John Wiley & Sons. Read More