- Lexic of non-english words
I. The notion of ethical marketing
- 1.1Marketing definition
- 1.2Critiques of the marketing leading to the ethical marketing approach
- 1.3Responsible marketing as a mirror of corporate responsibility
- 1.4The Corporate Social Responsibility insufficiencies regarding marketing
1.1 Marketing definition
Marketing, emanation of the twentieth century, is facing in this new century tremendous challenges in order to answer the critiques that decades of experimentations designed to make customers behavior come in line with businesses' interest created. Marketing could be defined as
the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large – (American Marketing Association 2007)
In terms of institution organization at large, the marketing is thus the function in an institution that organizes the relation between an activity and the rest of society in order to satisfy a pre-defined objective, through potentially all available means. It is thus not only limited to "satisfying customer needs" (Kotler et al. 2005, p.6) but also gather the means by which any organization – businesses, social businesses and non-profit businesses, associations, non-governmental organizations or even governmental organizations – can manage its relationships with the rest of the society. If the organization was a person, marketing would cover the whole communicational process: receiving signals, analyzing signals, sending signals, receiving and processing feedback.
This wide acceptation of marketing brings to light an important point for the following development and the critique of marketing: marketing as the management of relations with other actors of the society is vital to any non-autarkical organization. None of the previously enumerated organization can operate within the social structure without relationships with other stakeholders of this structure and none can be successful in its activity without managing those relationships, which potentially means analyzing and modeling the social structure, planning to operate within the understood social framework and implementing this plan in order, as said before, to satisfy a pre-defined objective. It is thus out of the discussion on ethical marketing hereafter to recommend the end of marketing despite all the critiques we might raise but rather to determine the ways of maximizing the efficiency of marketing in its attempt to implement valuable connections and interactions with the rest of the society while minimizing its potentially harmful impact, if any, and maximizing its beneficial impact, if any. In the following paragraphs, for greater clarity, we will focus on classic economic organizations that have an objective of profit maximization i.e. classic for-profit businesses.
1.1.2 The marketing strategy and its implementation through the 4P: analyzing and sending signals
In manuals, the marketing is often divided between marketing strategy and its implementation through the marketing-mix made of the 4P: Product, Price, Promotion, Place (Kotler et al. 2005, vii). This approach value the main operational variables that can be used by professional marketers and underline the coherence needed between the different elements of the mix. Through those cognitive tools progressively created by research in marketing, the means determining the marketing relationship between businesses and customers are objectivized in order to ease the management of this relationship.
In our linguistic metaphor of the firm, strategic marketing would be the cognitive gathering of external signals sent by the environment – the market, in the economic theory, without other stakeholders than suppliers and customers – and the processing of those signals. This part of marketing corresponds to the business plan of the entrepreneur, how the entrepreneur plan to satisfy what he analyzes as a demand for a specific value from other actors of the economy, what market he aims to enter or to create and how he aims to gain a competitive advantage in this market. This corporate strategy has to answer the question of
how to achieve high levels of performance in the markets and industries within which it is operating [, which] require an understanding of both the economic logic from which a strategy is derived and an understanding of the organizational logic through which a strategy is implemented – (Barney 2011, p.3)
This strategic marketing analysis will thus determine the organizational structure of the firm: what legal status the entrepreneur will choose, what will be the shape of the organization, the investments needed and the human resources policy associated in order to deliver which value to which segment of the population. As the equivalent of the cognition phase in the linguistic process, strategic marketing is the true helm of the following signal emission, the marketing-mix and its 4P.
In the classic marketing paradigm the emission of signals to other actors of the environment has only one purpose: "to increase the company's profits by increasing the sales of its products" (Camenisch 1991, p.246). This approach of marketing is fully compatible with the neoliberal economic theory and is legitimated by it, as when Milton Friedman defend the idea that "the social responsibility of business is to increase its profits" (Friedman 1970)
1.2 Critiques of the marketing leading to the ethical marketing approach
The manual Principles of marketing in its chapter Marketing and society: social responsibility and marketing ethics try to raise an exhaustive list of critiques upon marketing. The manual identifies various possible concerns from the consumer's point of view: the cost of advertising and promotion that will, at the end, be paid by the consumer; the question of the value added by marketing; the excessive mark-up allowed by marketing and brand strategies; the deceptive practices through pricing, promotion and packaging; the over-valuation of products; their possibly planned obsolescence. Possible concerns from society at large are also mentioned: the promotion of an exacerbate materialism; a low concern for common goods; a cultural pollution due to the growing ubiquity of advertising; lobbying efforts of brands eventually against the public interest. But the manual conclude that "some of this criticism [on marketing] is justified; much is not" (Kotler et al. 2005, pp.167–208). This optimist diagnostic is far from obtaining unanimity: the impact of marketing and the business it serves is a recurrent question in business sciences. Such a unidirectional optimist diagnostic for a pedagogic purpose seems counterproductive as the question is a key to understand how a smooth integration of marketing practices into society is a matter of balance between contradictory incentives:
the tension between the imperatives of economic survival in the competitive marketplace and ethics is a very real one for many individuals and corporations. – (Camenisch 1991, p.245)
1.3 Responsible marketing as a mirror of corporate responsibility
This question of ethics in marketing and in business at large is especially crucial since there are no obvious limits to marketing and business practices out of legal ones and that of religion, honor codes or forms of solidarity in former communal social organizations, which uses to be referential set of moral "guidelines", are no longer dominant value systems in western societies, letting those societies potentially rely on solely law as border of what is or isn't acceptable. But in the context of globalization and decreasing state sovereignty and regulation power regarding companies' actions, the translation of population wishes of regulation into law is limited by the pressure of the international economic competition, which strengthens multinational explicit or implicit negotiation powerpushing for deregulation, following Margaret Thatcher's TINA paradigm – "There is no alternative" –, leading to growing accusations of irresponsible behavior from other society members:
Callous unconcern for the feelings of others", "Incapacity to maintain enduring relationships", "Reckless disregard for the safety of others", "Deceitfulness: repeated lying and conning others for profit"; "Incapacity to experience guilt"; "Failure to conform to social norms with respect to lawful behaviors – The Corporation(Bakan et al. 2003)
Among others, the documentary film The Corporation severely depicts corporations – and thus marketing as their relational organ – as entities gathering all psychopathic syndromes, due to their blind focus on profit. The summit of The Corporation demonstration regarding marketing practices is made through the example of Susan Linn works on children nagging their parents about purchase. This study attempts to sketch best practices in order to reach a higher efficiency of marketing efforts, from a purely technical point of view:
In 1998, Western International Media, Century City and Lieberman Research Worldwide conducted a study on nagging. This study was not to help parents cope with nagging. It was to help corporations help children nag for their products more effectively. – (Holovat 2006, p.24)
If individuals are presumed to be moral and responsible for their acts, corporations suffer from a diluted responsibility: managers are responsible of the activity toward shareholders, shareholders are too numerous to respond for any responsibility and, through financial market, limit their implication in the corporation to one action: asking for bigger returns on investment and thus more profits. This social and legal design of limited responsibilities of intern stakeholders leads to the shunning of responsibility and is thus said to empower "monsters" (Bakan et al. 2003). In this irresponsible trend, marketing is hugely pointed; its rational approach of how to create buying motivations is depicted as deeply amoral. While this movie demonstration is open to criticism in its form and its scientific rigor, what it highlights is in the end consensual: corporations built a power to manufacture lifestyles going beyond any control of public institutions:
Corporations shape lifestyles by producing and promoting healthy or unhealthy products, creating psychological desires and fears, providing health information, influencing social and physical environments, and advancing policies that favor their business goals. – (Freudenberg 2012)
Milton Friedman, the historical leader of the neoliberal revolution that occurred between 1970 and 1990, wouldn't have denied this analyze of businesses limited responsibility, which – out of the term psychopath – is compatible with his famous intervention titled The Social Responsibility of Business is to Increase its Profits:
What does it mean to say that "business" has responsibilities? Only people can have responsibilities. A corporation is an artificial person and in this sense may have artificial responsibilities, but "business" as a whole cannot be said to have responsibilities, even in this vague sense. […] In a free-enterprise, private-property system, a corporate executive is an employee of the owners of the business. He has direct responsibility to his employers. That responsibility is to conduct the business in accordance with their desires, which generally will be to make as much money as possible while conforming to the basic rules of the society, both those embodied in law and those embodied in ethical custom. – (Friedman 1970)
But those basic rules of the society tend to be weakened: on the one hand, deregulation decreased formerly existent legal limits on business practices; on the other hand, as we will see later, ethical customs are undermined in the current socio-technical organology.
Following Milton Friedman many business persons dismiss such social responsibility as an inappropriate add-on for business people and organizations operating in the competitive marketplace. They often maintain not that business does no social good, but that business that does its business well is already performing a number of positive services to society and its members through the creation of jobs, the paying of taxes, and the generating of beneficial and/or desired products and services. Additional social responsibility is simply seen as excessive and inappropriate – (Camenisch 1991, p.245).
Friedman's intervention is especially interesting regarding marketing ethics, knowing that marketing's history is closely linked with economic theory (Bartels 1976, chap.12): since the Classic, Economist wanted to make Economic a natural science, relying on mathematic models (Lordon 2009). Marketing found much inspiration in economics models (Bartels 1976) despite the theoretical difficulties it represent: the economics theoretical work based on a pure and perfect market suppose a perfect information and rational economics agent, marketing is thus irrelevant in the very model he took inspiration from (Anderson 1983).
1.4 The Corporate Social Responsibility insufficiencies regarding marketing
Nevertheless, since long there are "evidences of the business community's concerns for society" (Carroll 1999). Despite being pretty young in its formulation, CSR is thus the last expression of an old process attempting to "[reconfigure] the balance between institutions that together make up society" (Habisch, A., R., & Jonker 2005, p.2). This reconfiguration through the CSR paradigm is not a legal reconfiguration but rather a self-regulating attempt from businesses, for various purposes with various forms of implementation, based on voluntariness (Dahlsrud 2008). Consequently, the CSR definition change from a corporation to another (Dahlsrud 2008) from a country to another (Habisch, A., R., & Jonker 2005). Nevertheless, definitions converge on five pillars that are the environmental dimension, the social dimension, the economic dimension – that constitute together the three pillars of sustainable development as commonly accepted –, the stakeholder dimension and the voluntariness dimension (Dahlsrud 2008, p.4). Once those dimensions are enounced, the following questions remain: how to identify the harmful impact of an activity? How to determine the right balance between the three pillar of sustainable development and how to implement it? The complexity of the first question rely on the fact that identifying the impacts of an action, or defining what is a right action, is a process based on knowledge that is a social construction (Berger & Luckmann 1966) that come within a specific theoretical paradigm. Then, the ability of managers to implement theoretical conclusion, rely on mental representation of CSR by managers, what they keep in mind from theory. In marketing, there is hence a difficulty for managers to identify what the word "social" imply for their activity, how they
impact on, or contribute to, the well-being of society as a whole. This difficulty is understandable because, as explained by Max Clarkson, society is "a level of analysis that is both more inclusive, more ambiguous, and further up the ladder of abstraction than a corporation itself" (Clarkson, 1995). Therefore, we propose as a starting point that even though businesses in general are accountable toward society at large, an individual business can be deemed responsible only toward the definable agents with whom it interacts. These agents can be regrouped under the label of "stakeholders" (Freeman, 1984) – (Maignan et al. 2005, p.3)
There is thus a focus on marketing primary impact, which falls within the larger CSR trade-off. The stakeholder approach leads to limit "responsibility initiatives to those issues of concern to the most powerful and visible stakeholder communities" (Maignan et al. 2005, p.8). Thus, being based on voluntariness, CSR can find its value in the comparison between competitors and what we could call their respective "perceived value added / value destroyed ratio". If none of the competitors implements a stronger CSR policy toward a given stakeholders group, there is no strategic disadvantage and thus no urgent incentive to implement such a change. Reciprocally, any innovative efforts toward responsibility would, from accountancy logic in a competition mindset, be considered an unnecessary cost if not justified by a strategic advantage or the corporate values and norms. As put by M. Brennan,
the question these organisations ask is: "How might these factors affect what I am doing (i.e. profitability)?" not "What effect might what I am doing have on others?" – (Brennan 1991, p.4)
Consequently, there are several cases in which CSR is an insufficient framework: when the stakeholder group concerned is not a primary stakeholder – i.e. with low power or low implication – or when stakeholders' interest is unknown by those stakeholders. This last situation could be illustrate by previous cases: before the scientific community alarmed the opinion about the dangers of cigarettes or the use of chlorofluorocarbons, convincing a growing number of consumer to express a concern on those subjects, there was no urgency for businesses to act responsibly regarding lung cancer or the ozone layer: concerns regarding businesses are social construction too. If today, businesses are asked to act responsibly toward the environment and social very tangible concerns such as wages, unemployment and the social welfare directly related to the business activity, what are the firewalls against a possible attempt to social welfare that fall in the category of "ambiguous, and further up the ladder of abstraction than a corporation itself" previously brought up? Indeed, being less tangible, it is harder to identify marketing's negative externalities at a society scale than to identify the impact of an industrial supply chain on its direct environment. Business responsible initiatives being dependent of what is brought to stakeholders' consciousness, research toward business' variably tangible externalities is a primary stake for businesses depending of the related activity. Regarding marketing, there is a long history of critiques and fears since its early developments in the 1950s, denouncing "threats to liberty and individualism posed by advertising and consumer culture" (Manning 2011, p.3). These accusations were hugely denied and considered attempts to "[capture] the popular imagination" (Manning 2011, p.3). Society's concerns toward marketing have since long influenced marketing's theory evolution as illustrated by the societal marketing concept in the late 1980s, which was urging marketers "to consider the wants and long-run needs of both society and consumers" (Brennan 1991). The difficulty in such an attempt is the theoretical solidity of final recommendations: what are the pertinent disciplinary fields involved? How far could go the critique toward marketing when marketing itself emerged in parallel of cultural trends, namely materialism and consumerism? Where does the marketing paper end and the political or philosophical argumentation begin?
For better or worse, American culture is well on its way to becoming world culture. The Soviets have fallen. Only quixotic French intellectuals and anxious Islamic fundamentalists are trying to stand up to it. – (Twitchell 1999)
This 1999 assumption when the idea of "the End of History" was taken for credible by numerous thinkers, echoes oddly thirteen years later.
Coming from a philosophical analyze of techniques and of the psychic apparatus, Bernard Stiegler – directly inheriting from the above-mentioned "quixotic French intellectuals"– dedicates a large part of his work to re-explore the impact of marketing on our psychology and on society at large, reframing the way we can model marketing externalities; defending what he calls an "Ecology of the Spirit". If he makes an extensive use of Marx critique of capitalism, especially regarding proletarization processes that is to say loss of savoirs (Stiegler 2012a), he defends a re-organization of capitalism, not the end of it, which organization would keep a market economy but would quit what he describes as a market society based on "industrial populism" (Stiegler 2008b). The differentiation between a market society and a society with a market economy mainly relies on the place given to marketing and the corporations' interests it serves.
We will use Siegler's analysis of marketing to examine the possibility of an inner dynamic of marketing practices that would take in account its positive and negative impact on the society at large and tend toward the annihilation of the later; the use of the "ethical marketing" term hereafter refers to this project definition.
- Lexic of non-english words
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