Title: An Introduction to Business Ethics
1An Introduction to Business Ethics
- Chapter 8
- Marketing Ethics Advertising and Target Marketing
2Ethics of Sales
- The aim of all marketing strategies or techniques
is the sale. Producing and pricing goods is an
important element of this, but advertising and
product placement are the means by which the sale
is promoted.. - We often assume that these aspects of marketing
are a relatively benign aspect of contemporary
business. After all, they involve no cultural
conflict, no violation of employee rights or
responsibilities, and no obvious abdication of
corporate responsibility. - Furthermore, advertisement is directed at free
individuals who are not externally coerced to
accept the claims made by the advertisers.
Despite these facts, there are significant
ethical issues that arise in these contexts.
3A Question of Influence
- The aim of marketing and product placement is to
influence the purchasing decision of the
consumer. - Clearly, there are ethically acceptable and
unacceptable means of influencing consumer
behavior - Acceptable means include persuading, asking,
informing and advising. - Unacceptable ways include threats, coercion,
deception and lying.
4Influence and Manipulation
- The unacceptable means of influencing people
share a common feature they all aim at
manipulating the consumer. - Manipulation seeks to guide behavior without the
consent or awareness of the target. - Manipulation is not control its more subtle.
- The better you understand how people think, the
more effectively you can manipulate them. - Manipulation should be contrasted with forms of
rational influence like persuasion.
5Manipulative Marketing
- It should be easy to see that critics of
advertising and product placement techniques
focus on instances where the intent of the
techniques is clearly manipulative. - Another area of concern is marketing research, in
particular research aimed at consumer psychology.
6Is There Anything Wrong with Manipulation?
- Before we examine some of the particular concerns
raised by ethicists and business people, we
should answer this question. - All of the general ethical approaches weve
examined raise important objections to many forms
of manipulation. - Manipulation is characterized by a failure to
treat others with respect by treating them as a
means rather than an end. - Manipulation thus tends to decrease overall
utility by making social interaction more
difficult. - Manipulation conflicts with many of the most
commonly articulated virtues (ex. honesty).
7Deceptive and Unfair Advertising
- Some advertising techniques are obviously
unethical. - Prominent among these are techniques that seek to
deceive consumers or seek an unfair advantage
over competitors. - Is the Tylenol campaign an example?
- What was its intent?
- What did Johnson Johnson want to achieve?
8Regulating Deceptive and Unfair Advertising
- Given the harms that arise from deceptive and
unfair advertising, society has good reasons to
target these forms of advertising. - There are obviously a number of practical
obstacles to overcome, but our analysis of the
Tylenol case highlights some important resources. - The focus on intent seems promising. Perhaps we
could target advertising that intends to deceive. - Given the difficulty of measuring intent, some
have argued that we should focus on effects. - In both cases, it seems necessary to agree on
some definition of the qualities of a reasonable
consumer.
9Considering Other Effects
- The question of the effects of deceptive and
unfair advertising points to other issues
concerning the effects of advertising. - Clearly advertising can have a number of positive
effects on consumers, markets and the culture. - Information entertainment, market efficiency.
- Are such effects always positive?
10Galbraith and the Dependence Effect
- Economist John Kenneth Galbraith argued that
contrary to common assumptions, advertisement
doesnt just respond to demand, it in large
measure creates it. Galbraith labeled this
capacity the Dependence Effect. - Galbraith went on to argue that there are three
negative consequences of the DE - It reverses the law of supply and demand, making
demand a function of supply. - It creates and encourages irrational consumer
desires, which limit the efficiency of markets. - Advertising that creates demands undercuts
consumer autonomy.
11Some Implications of the Dependence Effect
- If Galbraiths concerns are legitimate, there are
a number of important consequences. - Undercutting consumer autonomy would violate
traditional ethical standards. - Market exchanges which appear to increase overall
satisfaction would actually not do so. - The reversal of the law of supply and demand
significantly undercuts the democratic nature of
markets and makes it difficult to justify the
accumulation of wealth by a few individuals on
the ground of their supposed responsiveness to
consumer demand.
12The Dependence Effect and Autonomy
- The thin wedge of this issue is the question of
autonomy. - Is it the case that common forms of advertising
undercut consumer autonomy? - Answering this question requires a distinction
prepared for in our analysis of manipulation. - We saw there that undercutting autonomy does not
require actually controlling a person. - That is, a person can act without constraint, but
still not be acting autonomously.
13Autonomous Behavior vs. Autonomous Desire
- We can account for the gap between action and
autonomy, by noting a difference between
autonomous behavior and autonomous desires. - If I act without constraint, I can in one sense
be said to be acting autonomously. - However, if the desires upon which I act are not
autonomously chosen, then the lack of constraint
does not guarantee autonomy. - Is the drug addict acting autonomously when they,
without external interference, use drugs?
14A Framework for Understanding Desire
- A way of understanding the apparent conflict
lived by an addict it to draw a distinction
between first-order and second-order desires. - A first-order desire is any desire I have at the
moment. A second-order desire is one I have on
the basis of a reflective consideration of my
interests. - Autonomy requires this capacity for reflection.
- It is thus the capacity to form and act in
accordance with second-order desires which makes
a person autonomous.
15Autonomy and the Addict
- The addict may have strong first-order desires
for that to which they are addicted, but any
reflective individual in that situation is going
to have strong second-order desires to be free of
the addiction. - Given the analysis just offered, to the extent
that the addict acts on their first-order desires
rather than their second-order desires, they act
non-autonomously.
16Autonomy and Advertising
- Under what conditions are the desire-creating
capacities of advertising going to be consistent
with the autonomy of consumers? - Only in that situation where the creation of
first-order desires does not conflict with
legitimate, reflectively established second-order
desires. - This is reflected in the cooling-off periods
common in consumer protection law. - In other words, the fact that consumers often
respond favorably to desire creating marketing
techniques is no evidence of their acceptability.
- Willingly participating in therapeutic shopping
is not enough. The individual would have had to
reflect upon the nature of such an enterprise and
determined its appropriateness.
17Further Complications
- Even this picture may fail to address the full
complicity of advertising in undercutting
consumer autonomy. - Persuasive advertising actively contests the
development of the critical, reflective skills
necessary for the formation of autonomous
second-order desires. - Sheer volume of advertising which bombards us
everyday renders even the most critical and
reflective individuals incapable of immunizing
themselves from autonomy-limiting first-order
desire creation.
18Target Marketing and Manipulation
- Our analysis of advertising and autonomy
suggested that directing advertising at
reflective established desires was ethically
appropriate. - On the other hand, advertising aimed at desires
not so established is ethically inappropriate. - Such desires would seemingly include those
grounded in fears, anxieties, and whims.
19Vulnerability and Desire
- Consider the examples offered on p. 168.
- What is the difference between the ad addressed
to young, active women and that addressed to
elderly widows? - Clearly, the ad aimed at the widow plays on the
perception or reality of her vulnerability. - Can desires grounded in vulnerabilities be
well-founded. If they arent , do marketers have
a special responsibility to the vulnerable?
20Nature and Types of Vulnerability
- Vulnerability refers to a susceptibility to
harm more specifically it refers to factors that
individuals possess that makes them more
susceptible than their fellows. - Individuals exhibit General Vulnerability when a
physical or psychological feature they exhibit
makes them susceptible to some harm. - Elderly, addicts.
- Individuals exhibit Consumer Vulnerability to the
extent that their ability to participate in
rational exchanges is impaired. - Children
21Marketing to Vulnerability
- Marketing techniques can target general
vulnerabilities or consumer vulnerabilities. - Clearly techniques that target consumer
vulnerabilities are illegitimate, on the grounds
of our analysis of autonomy. - Just as clearly, many general vulnerabilities
make individuals vulnerable as consumers. - Elderly, infirm are vulnerable to ads that play
on their anxieties. Low income people vulnerable
to high priced consumer goods.