What is Ethical Marketing?
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What Is Ethical Marketing? (Importance and Examples)
By Indeed Editorial Team, Published November 8, 2022
The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.
Ethical marketers evaluate their decisions from both a business and a moral perspective. An ethics-based marketing approach focuses on the benefits that a product provides to customers and the positive impact it has on socially responsible or environmental causes. Understanding marketing ethics can be beneficial if you're considering a career in marketing. In this article, we explain what ethical marketing is, discuss why it's important, explore its principles, and review some examples of marketing ethics.
What is ethical marketing?
Businesses that commit to ethical marketing communicate their values to their target market by following transparent, responsible, and honest practices. Using marketing materials, these companies communicate their business ethics to reach target audiences with similar values. Ethics-based marketing teams aim to advertise products or services and make a profit while preserving their ethical standards. In contrast, unethical marketing focuses solely on profit at the expense of all other factors.
Why is ethics-based marketing important?
A company's marketing ethics are essential because they help support consumers' rights and lives. Implementing ethical practices can also contribute to the achievement of short-term and long-term marketing goals. For example, while using marketing ethics, brands can engage prospects with high credibility, customer loyalty, significant market share, and better revenues. Here are a few benefits of ethics-based marketing:
Promotes consumer well-being: Marketing ethically can include educating consumers about the potential risks associated with a company's products and services. As an example, companies that sell cleaning supplies may advise consumers on how to handle their products safely.
Establishes a role model: By fostering a positive work culture for employees and consumers, companies can foster a positive reputation and encourage other businesses to practise ethics-based marketing. Businesses and consumers worldwide can work together to solve social problems by supporting ethics-based marketing.
Contributes to employee well-being: Marketing strategies that promote consumer well-being may also promote the well-being of employees. As an example, businesses may provide their employees with reasonable work schedules and adequate compensation for labour.
Improves customer retention: Marketing practices that demonstrate care for quality and value can be an effective way to build trust among consumers. Companies can then increase customer satisfaction and loyalty, attract and secure new customers, and generate essential revenue.
Principles of ethically based marketing
Depending on the company's purpose, mission, and preferences, its marketing ethics guidelines may differ. The following are some common principles for ethics-based marketing:
Honesty
An important component of ethics-based marketing is the use of honesty in marketing communications. For business leaders and marketers, it's crucial that they convey the truth about their company's products and services to protect the consumer's health, well-being, and rights. For example, food products commonly contain labels listing the ingredients and nutritional information. Nutritional labels are important to people with allergies because they provide information about the product's ingredients.
Legality
A vital aspect of ethical marketing involves compliance with all government regulations, environmental standards, and industry standards. By complying with regulations, a business can establish its commitment to providing exceptional quality and customer service to its customers. Standards and regulations protect the liability and interests of businesses and enable them to continue to operate.
Behaviour
Marketing ethics require all members of the marketing team to adhere to high ethical standards. A company may set expectations for its employees regarding respect for the rights of others. For example, team members with an ethical approach to customer service may practise empathy and honesty.
Health and safety
The safety of their customers is a top priority for businesses and marketing teams operating ethically. Marketing professionals can uphold this principle by educating consumers, protecting their privacy, and respecting their civil and human rights. It's also beneficial for companies to ensure the physical safety and mental health of their employees. For example, a company may offer health and wellness benefits and programs to its employees.
Transparency
Transparency within marketing ethics means disclosing the details of the company's processes and behaviour. For example, a company may publish information regarding product development. The process also refers to having honest conversations about ethical issues. For organizations to remain accountable to their customers and stakeholders, it's crucial to be straightforward about their history, current practices, and future goals.
Quality: Consumers can set realistic expectations for products if businesses provide honest information about the quality of the product.
Pricing: Businesses can gain customers and build trust by being transparent about prices, pricing strategies, and additional charges.
Suppliers: When organizations disclose the partners and networks they support and pay, consumers can gain a deeper understanding of who they're supporting through their purchases.
Customer satisfaction: When businesses display customer reviews on their websites and in advertisements, they can develop their credibility and maintain a transparent approach to customer satisfaction.
Conscious practices
To protect communities and the environment, companies may commit to conscious practices. Conscious practices include fair trade, fair wages, and environmentally sustainable practices and materials. A company may also engage in conscious practices by promoting volunteerism, making a positive impact on the environment, and supporting charitable institutions.
Examples of ethical marketing
The following are a few examples of how companies use marketing ethics:
Example 1
Working for social change and addressing public concerns is an excellent way to practice ethics-based marketing. Social change refers to changes in human interactions and relationships that affect cultural and social institutions. Using their power and influence, companies can foster community engagement and empathy. Here's an example of using power and influence for social change:
Sam owns a shoe company and is trying to implement better marketing practices. Sam plans to implement an initiative to assist the homeless population in the community. Through a partnership with a local retailer, Sam gives away free shoes, socks, and clothing. The company also donates a portion of its profits to local shelters. Throughout the campaign, Sam informs consumers about these changes and encourages them to learn more about the cause.
Example 2
It's beneficial for marketers to listen to and act on customer feedback, as it allows them to improve a product and provide more value to consumers. The development of high-quality and useful products with accurate advertising can build trust among target markets and attract loyal customers. The concept of customer loyalty is an ongoing relationship between a business and its customers. Loyalty leads to repeat purchases and encourages existing customers to choose one company over another, offering similar services. The following is an example of how a business may respond to customer feedback using marketing ethics:
Taylor is a marketing manager at a mid-size interior design firm. It's Taylor's responsibility to advertise the firm's design services and its products for home furnishing and decor. Following an assessment of customer feedback, they discover many customers are unhappy with the quality of one of the company's products. Taylor communicates the feedback to the product development team and works with them to create a solution. By switching suppliers and making the product with high-quality materials, they can market the product more effectively and improve customer satisfaction.
Example 3
Organizations and teams with ethics-based marketing practices strive to conduct honourable business practices. Ethics-based marketing teams may place a higher priority on supporting the health and satisfaction of consumers and employers than on making a large profit. Workplace wellness involves an organization's ability to support its employees' physical and mental health. Consumer well-being is a measure of the satisfaction that consumers receive from using a company's products and services. Here's an example of how a company may prioritize its employee's well-being:
Riley is a marketing director at a media agency. Riley learns that the organization pays fair wages and provides comprehensive health benefits to employees, even though these salaries and compensation levels are higher than market rates. By supporting its employees, the firm fosters a positive work environment. Riley recognizes that this may be an ideal feature to include in marketing campaigns.
