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Chapter 2

SOCIALLYSOCIALLYRESPONSIVE MARKETINGRESPONSIVE MARKETING

2-1 The Impact of Marketing

2-2 Criticisms of Marketing

2-3 Increasing Social Responsibility

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Focus Questions:What message is being

communicated by Waste Management in this advertisement?

Do you think the message is effective?

How does it demonstrate social responsibility?

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THE IMPACT OF MARKETING

GOALSGOALSExplain how marketing affects

businesses.Describe marketing’s impact on

individuals.Discuss ways marketing benefits

society.

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Marketing Affects Businesses

Critical business functionCustomer satisfaction

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Marketing Helps People

Better products at a lower costExpanded opportunities

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Marketing Benefits Society

New and better productsBetter standards of livingImproved international trade

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Benefits of Marketing

Businesses meet consumer needsConsumers make better decisionsNatural resources are used more

effectivelyStandard of living is improvedInternational trade increases

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CRITICISMS OF MARKETING

GOALSGOALS Discuss three common criticisms of

marketing.Explain how marketing can be used to

solve social problems.

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Common Complaints

Marketing causes unneeded purchasesMarketing wastes moneyMarketing is not always needed

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Total product price (100%)

Pro

du

ct P

rice

Average cost of all marketing activities (50%)

Average cost of sales and advertising (2–10%)

The Typical Costs of Marketing

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Marketing Solves Problems

Marketing increases public awarenessMarketing helps match supply with

demand

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INCREASING SOCIAL RESPONSIBILITY

GOALSGOALSDefine consumerism.Explain ways by which businesses

improve their own practices.Discuss how ethical issues affect

marketers’ professional responsibilities.

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Consumer Protection

The growth of consumerismConsumerismGovernment regulation

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Social Responsibility Must Be Shared

BUSINESSBUSINESS

GOVERNMENTGOVERNMENT

CONSUMER CONSUMER GROUPSGROUPS

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Sherman Antitrust Act, 1890

To increase competition among businesses by regulating monopolies

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Food and Drug Act, 1906

To control the content and labeling of food and drug products by forming the Food and Drug Administration (FDA)

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Federal Trade Commission Act, 1914

To form the Federal Trade Commission (FTC) to protect consumer rights

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Robinson-Patman Act, 1936

To protect small businesses from unfair pricing practices between manufacturers and large businesses

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Fair Packaging and Labeling Act, 1966

To require packages to be accurately labeled and fairly represent the contents

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Consumer Credit Protection Act, 1968

To require disclosure of credit requirements and rates to loan applicants

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Consumer Product Safety Act, 1972

To set safety standards and to form the Consumer Product Safety Commission (CPSC)

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Americans with Disabilities Act, 1990

To prohibit discrimination and ensure equal opportunity for persons with disabilities

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Telemarketing and Consumer Fraud and Abuse Prevention Act, 1994

To prohibit deceptive telemarketing practices and regulate calls made to consumers’ homes

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Millennium DigitalCommerce Act, 1999

To regulate the use of electronic contracts and signatures for Internet business transactions

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Gramm-Leach-Bliley Financial Modernization Act, 1999

To limit the sharing of consumer information by requiring financial services companies to inform consumers about how private information is handled

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Improving Practices

Codes of ethicsSelf-regulationSocial action

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Responsibilities of the Marketer

In product development and management

In promotionsIn distributionIn pricingIn marketing research

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Ethics in Marketing

Responsibility to customersHarm and accountability