Chapter 4: Ethical and Social Responsibility in Marketing

Annual losses from theft of intellectual property:

• Music industry…$12.5 billion

• Movie industry…$18.2 billion

• Software…$53.0 billion

Losses from peer-to-peer downloading is perceived to be unethical by the majority of the US public, but only by one third of college students.

Societal Values and Attitudes:

• Are relative

• Affect ethical and legal relationships

It is not uncommon for a person to adapt their behavior and ethics to the group where they spend their time, and to change it from group to group.

Ethics of Exchange

The exchange process is central to the marketing concept. Ethical exchanges between sellers and buyers should result in both parties being better off after a transaction.

Societal culture provides a foundation for understanding moral behavior in business activities. Business cultures “comprise the effective rules of the game, the boundaries between competitive and unethical behavior, [and] the codes of conduct in business dealings.”

Before the 1960s, the legal concept of caveat emptor, let the buyer beware—was pervasive in the American business culture. In 1962, President John F. Kennedy outlined a Consumer Bill of Rights that codified the ethics of exchange between buyers and sellers. These were the right:

(1) to safety: The U.S. Consumer Product Safety Commission routinely monitors the safety of 15,000 consumer products. However, even the most vigilant efforts to ensure safe products cannot foresee every possibility.

(2) to be informed: The right to be informed means that marketers have an obligation to give consumers complete and accurate information about products and services.

(3) to choose, Relating to the right to choose, today many supermarket chains demand “slotting allowances” from manufacturers, in the