According to recent studies, more and more consumers consider the values and ethics of a brand in their purchase choice.
For example, did you know that 92% of millennials prefer to buy products from ethical companies?
What’s more, even some studies like this reveal that more than 90% of consumers would boycott a company if it were shown to operate under irresponsible or unethical practices.
Connectivity and the smartphone have made us more demanding: we inform ourselves about the products we consume and question the behaviour of brands.
The smartphone also gives us the ability (which we never had before) to talk to brands from you to you and see our message amplified through Social Networks.
In this new digital ecosystem, consumers demand social responsibility from brands. Brands need to be authentic, transparent and have values and the ability to communicate them appropriately.
It is a question of survival rather than the key to success, and the answer to these new demands lies in ethical marketing.
What is ethical marketing?
Ethical Marketing is not a marketing strategy but a philosophy that must reach all levels of the company.
But what is it exactly?
There are many theoretical definitions from different authors.
Do you want a simple one?
–It consists of making morally correct marketing decisions.
In other words, it consists of making each marketing decision taking into account not only the business return or profit but also the moral perspective: whether or not a decision is ethically correct.
This behaviour is in line with the new demands of consumers.
The effort that a company makes to make its communications and marketing more ethical will positively impact all areas of the business.
Benefits of applying ethical marketing in your strategy
. Give the company prestige and enhance its reputation.
. Add value to your product.
. It favours the business and improves sales.
. Bad practices are avoided.
. Long-term relationships are established with stakeholders and clients.
. Improves the quality of the staff, the cohesion of the team and their commitment;
. Improve competitiveness.
. Facilitates the connection between consumers and the brand;
How to determine what is ethically correct?
We are already clear that ethical marketing will bring a lot of advantages to your business strategy.
But the line that separates what “is right” from what is “wrong” is difficult to define.
–Ethics is a philosophical, abstract concept and is perceived subjectively. How can we guide ourselves?
To begin with, we are going to define the practices to avoid, the NON-ethical practices.
What is considered unethical Marketing?
Unethical marketing evolves, and new forms emerge, as with any form of marketing.
And most, in addition to being unethical, are illegal practices.
Below I detail some practices related to the decisions of the classic marketing mix (Global Perspectives on Contemporary Marketing Education by Smith, Brent) and other more modern ones that are emerging on the internet, cited by other sources.
. Price discrimination: a strategy that consists of charging different prices for the same product based on certain customer attributes.
. Bait and switch: attract customers with a very low price and then persuade them to buy a similar product at a much higher price by arguing, for example, end of stock.
. Predatory pricing: for example, to prevent a competitor from entering.
. Predatory pricing
. Wars or price pacts
. False sales
About the product
. Copy the presentation or packaging.
. Test on animals.
. Scheduled obsolescence
About the distribution (Place)
. Excessive depression to close the sale
. Sale of samples
. Sale of prohibited products to a certain public (tobacco, alcohol)
. Sell what leaves more margins without considering the needs of the customer.
. Substitution: There is in some places the prohibition of certain advertising products, such as tobacco or alcohol. Surrogacy advertising seeks to remind consumers of the existence of these products indirectly.
. Misleading advertising
. Exaggeration: It consists of launching false advertising messages about the quality of a product or its popularity. A slogan like “get coverage anywhere on the planet” promotes a feature that cannot be served.
. Subjective advertising messages about the company’s products. Phrases like “The best chocolate in the world” cannot be confirmed.
. Unverified advertising messages: Products that promise results without any scientific support as evidence. Those slimming creams that promise miracles in a few days without specifying how or why;
. Use of stereotypes
. Lack of competitive ethics: Whenever a business makes false or misleading advertisements about competitors’ products or subjectively presenting their product as better.
. Black hat link building
. Contact people without prior consent.
. Create controversy or exploit emotions in RRSS, taking advantage of an event of great emotional impact, for example.
These are the practices to avoid.
Some of them may pay off in the short term, but you are seriously jeopardizing your business reputation. And it does not usually compensate…
–“No amount of marketing budget will reverse public opinion”.
Principles of Ethical Marketing
The Institute for Advertising Ethics published a list of 8 Ethical Marketing principles in 2011.
The mission of this independent body, administered by the AAF (American Advertising Federation), is to be the source of information for professionals, theorists and students of marketing and advertising on all matters relating to ethics.
According to the IAE, these are the 8 basic principles of ethical marketing:
1. All marketing communications will share the standard of truth.
2. Marketers will adhere to the highest standards of personal ethics.
3. Advertising must be differentiated from news and entertainment editorial content.
4. Marketers must establish who they pay to promote their products.
5. Consumers will be treated, considering their nature and characteristics (for example, marketing to children).
6. Consumer privacy will never be compromised.
7. Sellers will comply with laws and standards established by governmental or professional organizations.
8. Ethical issues will be discussed openly and honestly during marketing decision making.
On the other hand, the Spanish Marketing Association has also developed a Code of Ethics to guide Marketing professionals in their work performance and promote best practices.
Delving into the concept
Following the ethical Code and avoiding these practices marked as unethical will help you stay within the law and comply with the minimum requirements.
But it’s not enough!
Because this is taken for granted
Only with this, you will not be able to contact your audience.
You need to go further!
Complying with the law makes you socially acceptable. Still, it is not enough to claim attention on you, much less to arouse passions.
–And as a brand, you need to excite the consumer.
That is why it is necessary to delve into the concept of ethical marketing.
Beyond the minimum requirements, true ethical marketing will have a place in socially and culturally responsible companies.
Would you say that it is worth the effort to issue advertising messages that comply with ethical principles to advertising brands that engage in dishonest, anti-ecological or socially irresponsible practices?
It may work for a while, but the truth always comes out.
To embrace ethical marketing strategies, values such as honesty, fairness and responsibility must be part of the philosophy and business life from the bottom up.
–It is not enough that the message respects ethics.
Ethical marketing is not a pose or a strategy: it must highlight the ethical choices that a brand makes to improve its reputation and make efforts to balance the interest of the company with legality and its social responsibility.
The concept of social responsibility goes far beyond recycling and environmental Sustainability.
Other concepts such as transparency, fair treatment of employees and other measures that benefit people are even better valued by consumers.
Does your brand have values?
As Mark (“Ethical Marketing and the new consumer”) comments, “ethics” come from “ethos”, from the Greek: conduct, character, personality.
According to Mark, the brand is not defined logo, not even by the advertising message, but by what it does and why it does it.
And this is defined by the “ethos”, the personality and conduct of the brand.
–“Behavior defines the brand more than marketing”.
The logo is an important visual element of branding that we will remember or not. Still, people are not talking about logos: we are talking about reputation.
The reputation of the brand is what reflects its true values.
Companies that manage to connect with consumers have personality, defined values and a strong communication strategy for these ethical values.
It allows them to consolidate their reputation and their position in the market.
To define the “ethos” of your brand that allows you to develop its personality solidly, you need to review what you do and why.
And define what characteristics of your activity and what values to develop ethically.
But how many values are there?
What are the good ones?
–There is no closed list or universal criteria.
Responsibility, Fairness and Honesty are always cited first.
Other important ethical values for consumers are:
. I respect.
Are any of these values already part of your philosophy?
Which ones could you develop within your business activity?
And how should you include them in your strategy?
The answers will depend on many things: the optimal thing is to include ethics in the business philosophy from the beginning, but if your company is already in the market, you should review in-depth the existing marketing.
Regardless of the stage of your business. You should define an ethical marketing plan, a plan to show your ethical business values.
How to create an ethical marketing plan?
1. – Clearly define the ethical values to be developed
. (Re) define the mission and vision of your company, its activity and long-term goals. What values emerge from your business culture? Which ones can be enhanced or developed?
. Take time to seriously think about actions you could take, even small details that you could change to improve the ethical value of your company.
. Lean on other stakeholders: survey your employees, shareholders or partners to determine how they perceive the company. Try to highlight any point of ethical conflict, discuss it openly and establish solutions.
. Carry out or consult market studies to find out the ethical values most appreciated by your target audience.
. Watch the competition. What message do they convey? How are they perceived? What works for them? What mistakes have they made that we can learn from?
2. – Create a Business Ethics document
You must clearly state the following points:
. What are the main ethical values of the company? Define 5 or 6. Keep in mind environmental criteria, compliance with laws, social commitment actions, labour respect and, of course, responsible marketing
. What actions will the development of ethical values translate into?
. What objectives are pursued? Specify the improvements to be achieved and establish measurable objectives.
. Who are those involved?
. In what period will the actions be carried out?
. Who will supervise and promote the implementation of the Code of ethics?
3. – Create strategies for the dissemination of these values
Include this information in your marketing messages.
Remember that honesty and transparency are key.
It is not about saying that you are socially responsible or that the company is committed to Sustainability if it is not true.
–“It’s important in the World of Ethical Marketing” than the “way” and “say” are aligned”.
To launch ethical messages, you do not need to have travelled the path of social responsibility: you can start by spreading what you are doing to improve in that regard.
Remember that the communication of values begins within the company.
It is advisable to give training or workshops to inform the interested parties and involve them in adopting and promoting the Code of ethics.
4. And of course, measure and analyze the results
The measurement of results is part of any action or marketing plan.
But how do you measure something as abstract as ethical marketing?
. It monitors all the actions and objectives established in the company’s Code of Ethics.
. It surveys the stakeholders again and compares their responses and perception company and its activity after implementing the Code of ethics.
. It analyzes separately the marketing campaigns specifically dedicated to disseminating the Code of ethics and the changes and events arising from its implementation.
. Commit to reviewing and improving the Code each year, taking into account new needs or trends.
Examples of companies that apply ethical marketing:
More and more brands dedicate significant budget items to sustainability practices and corporate social responsibility.
Without going any further, recently, at the #HEMESIC event, a complete section was dedicated to talking about Transformation, Innovation and Social Entrepreneurship.
A Marketing Manager says “Technology with a purpose”, which includes different programs of Education, culture, quality of life and accessibility to improve people’s lives through technology.
Also, other examples were cited, such as Toyota or the Ternua Company.
Toyota dedicates a section of its official website to the project “Mobility for all”, specified in offering mobility solutions physical conditions. In collaborating with the IOC (International Olympic Committee) and the CPI International, Paralympic Committee ) for Olympic and Paralympic athletes to achieve their dreams.
–The list of examples would have no end.
All large companies are aware of the importance of their social responsibility and echo themselves by offering extensive information about their projects and progress in this regard.
Other examples are Telefónica and its Responsible Business project or Iberdrola and Repsol (which have a wide section on Sustainability on their websites).
You can see that it is not necessary to have a macro company that is part of the IBEX 35 to develop ethical marketing actions. There is the example of Ternua.
In addition to citing Sustainability among their values, in the “We Protect” section of their website, they explain that they have adopted 4 whales to collaborate with their protection and offer the possibility of joining the cause with one click.
And there is always something that you will be able to do regardless of the size of your company.
About the recycling of materials, there are numerous examples, some very innovative.
These days, information has been published about a Volkswagen initiative to recycle damaged car materials and turn them into mobile phone covers.
This action has a triple benefit: recycling, raising awareness of the dangers of mobile phone use while driving and allocating the money raised to the rehabilitation of people injured in these accidents.
Do you know of any outstanding examples?
Do you want to share it in the comments?
As you can see, the best examples of large companies are not focused on transmitting a message of social responsibility, but on improving the society around them and using marketing to communicate these improvement efforts.