CHAPTER 15

Marketing Ethics and Social Responsibility

LEARNING OBJECTIVES

After reading, studying and analyzing this chapter, students should be able to understand:
15.1 The meaning and importance of marketing ethics and social responsibility.
15.2 How marketers can exploit consumers by targeting children and encouraging
overeating and other forms of irresponsible buying.
15.3 Ethically questionable practices such as covert marketing, manipulative exposure
to advertising, and truth-in-advertising issues.
15.4 The nature and consequences of provocative advertisements.
15.5 How marketers abuse consumers’ privacy and the measures that can stop such
practices.
15.6 How marketers can advance society’s interests by advocating socially beneficial
conduct and discouraging adverse behavior.

CHAPTER SUMMARY

Learning Objective 15.1: To understand the meaning and importance of marketing

ethics and social responsibility.

The marketing concept is sometimes incompatible with society’s best interests. The
societal marketing concept requires that all marketers adhere to principles of social
responsibility in the marketing of their goods and services. Since all companies prosper
when society prospers, companies must integrate social responsibility into all marketing
decisions, and many have adopted the societal marketing concept. A serious deterrent to
more widespread implementation of the societal marketing concept is the short-term
orientation of most business executives and corporate boards in their drive to quickly
increase market share and profits.

Learning Objective 15.2: To understand how marketers can exploit consumers by

targeting children and encouraging overeating and other forms of irresponsible buying.

The study of consumer behavior allows marketers to understand why and how consumers
make their purchase decisions, but it also enables unethical marketers to exploit human
vulnerabilities in the marketplace and engage in other unethical marketing practices.
Such practices include targeting vulnerable consumers such as children, teenagers, the
elderly, and less-educated consumers, who may not have the knowledge or experience to
evaluate the products or services being promoted and the potential negative consequences
of using these offerings.

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Learning Objective 15.3: To understand ethically questionable practices such as covert
marketing, manipulative exposure to advertising, and truth-in-advertising issues.

Marketers can manipulate consumers’ interpretations of marketing stimuli through the

context in which those stimuli are featured. Covert marketing consists of marketing
messages and promotional materials that appear to come from independent parties but
are, in fact, sent by marketers. Some maintain that covert marketing strategies often
violate the FTC’s definition of deceptive advertising, endorsement guidelines, and other
regulations of marketing, and believe that the FTC should establish clearer rules to reduce
the use of masked advertising. The FTC has developed guidelines as to what constitutes
deceptive advertising, and it holds marketers responsible for determining their ads’
potential to mislead consumers. Although the FTC is responsible for stopping false or
misleading ads, and the agency encourages and investigates complaints by consumers and
companies regarding false or misleading ads, it cannot locate and stop all misleading ads.
The FTC can also require companies that have misled consumers through their
advertising to run corrective advertising.

Learning Objective 15.4: To understand the nature and consequences of provocative

advertisements.

Too many marketing messages convey socially undesirable stereotypes and images, some
of which tend to encourage risky or illegal behavior or create unrealistic perceptions.
Many studies have focused on the use of objectionable themes in advertising and
discovered that negative portrayals of various groups affect consumers’ perceptions.

Learning Objective 15.5: To understand how marketers abuse consumers’ privacy and
the measures that can stop such practices.

Consumers’ loss of privacy is an increasingly problematic ethical issue as marketers

identify and reach out to increasingly smaller audiences through innovative media and
more sophisticated tracking. The collection and dissemination of this information raises
many privacy issues and various governmental bodies have proposed measures to ensure
consumers’ privacy. “Do not track” and opt-out mechanisms, regulation of data brokers
and harvesters, and increased consumer access to the information collected about them
are other possible ways to combat the invisible tracking that is being done via Internet,
cell phone, and coupon use.

Learning Objective 15.6: To understand how marketers can advance society’s interests
by advocating socially beneficial conduct and discouraging adverse behavior.

Many not-for-profit organizations, including consumer advocacy groups, exist primarily

to promote socially beneficial behaviors. Many companies try to increase their credibility
by being “good corporate citizens” and integrating socially desirable practices into their
operations. Some firms engage in cause-related marketing, where they contribute a
portion of the revenues they receive from selling certain products to causes which are

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socially desirable and supported by the American public. A good fit between the
company and the cause appears to be crucial to the effectiveness of these campaigns.

CHAPTER OUTLINE

INTRODUCTION

1. Marketing ethics are moral principles that govern marketers’ behavior.

2. Ethics express the differences between right and wrong behavior and the goodness or
badness of human character.
3. Not all that is allowed (by law) is in the best interest of society or marketers’ goals.
4. Marketing practices that overtly contradict societal interests end up in embarrassment,
decreased profits, and diminished consumer confidence in promotional messages and
products.

*****Use Figure #15.1 Here; Use Key Term marketing ethics Here*****

The Societal Marketing Concept: Utopia or Reality?

1. Fulfilling the needs of target consumer markets more effectively than competitors
may be at odds with society’s best interests.
2. The cumulative persuasive impact of advertising may have negative implications for
consumer behavior (e.g. materialism and unrealistic ideal body images).
3. The societal marketing concept calls upon all marketers to satisfy the needs and
wants of their target markets in ways that preserve and enhance the well-being of
consumers and society as a whole, while also fulfilling the profit objectives of their
organizations.

*****Use Learning Objective #15.1 Here*****

4. Many trade associations representing marketers of consumer goods have developed

industry-wide codes of ethics.
a. Industry-wide self-regulation deters governments from imposing its own
regulations on industries.
b. Companies recognize that socially responsible activities improve their image
among consumers, stockholders, the financial community and relevant
publics.
c. Perceptions of a company’s lack of social responsibility or unethical
marketing can negatively impact consumer purchase decisions.

***** Use Figure #15.2 Here *****

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Exploitative Marketing

1. There are many targetable segments that can be exploited because they are more
vulnerable than most other consumers (less educated, older, low income, no political
power), but targeting children and encouraging overeating and irresponsible buying
are the focus of this section.
a. Consumer socialization is the processes by which young people acquire
skills, knowledge and attitudes relevant to their functioning as consumers in
the marketplace. The three stages are:
i. The perceptual stage (3-7 years old)
ii. The analytical stage (7-11 years old)
iii. The reflective stage (11-16 years old)
b. Children become brand aware as they age.
c. Overall, the older the child, the more influence he or she has on a parent’s
purchase behavior.
d. Children are consuming more media, which increases opportunities to target
children with marketing messages designed to influence their purchase
behavior.
e. There are many ethical concerns regarding advertising to children.
f. Advertising to children is subject to self-regulation according to guidelines
developed by the Children’s Advertising Review Unit (CARU) of the Council
of Better Business Bureaus
g. The guidelines direct marketers to abandon product presentations or claims
that:
i. Mislead children about the product’s performance or benefits
ii. Exploit the child’s imagination or create unrealistic expectations
iii. Show products in unsafe situations
iv. Encourage behavior that is inappropriate for children
h. The guidelines also direct marketers to avoid ads that:
i. Encourage children to pressure their parents to buy the products
advertised.
ii. Compel children to feel that ownership of a given product will make
them more accepted by peers.
iii. Make claims that mislead children, exploit their imagination or crate
unrealistic expectation.
i. A major concern regarding the impact of marketing on children’s behavior is
whether food marketers “teach” children to eat more than they should and
cause obesity and other health problems.
j. It must be remembered that children are a vulnerable population.
k. Regarding advertising to children, there is a consensus that even if children
understand the purpose of promotional messages, marketers must take special
care in advertising to them because of the amount of time they spend viewing
TV and online.

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 *****Use Learning Objective #15.2 Here; Use Key Term consumer socialization
Here; Use Table #15.1 Here; Use Review and Discussion Questions #15.1 and #15.2
Here; Use Hands-on Assignments #15.7 and #15.10 Here*****

2. Marketers studied situational factors surrounding buying decisions to learn how to

convince consumers to adopt a product or induce consumption.
3. Marketers sometimes encourage consumers to spend or eat more than they might
want/need to.
a. Cold grocery stores make consumers hungry/encourages overeating
b. Moving displays to encourage wandering increases overspending
c. Targeting online shoppers who have been drinking increases overspending
d. Designing foods that encourage overeating encourages overeating
e. Granting easy credit increases overspending
4. Packaging and presentation can also encourage overeating.
a. Both children and adults consume more juice when the product is presented in
short, wide glasses than in tall slender glasses.
b. Candies placed in clear jars were eaten much quicker than those presented in
opaque jars.
c. Sandwiches in transparent wrap generated more consumption than those in
opaque wraps.
d. The visibility and aroma of tempting foods generated greater consumption.
e. Presenting foods in an organized manner, such as mixed assortments in bowls
(or “grab bags”), buffets, potlucks, or dinner-table settings leads to more
eating.
f. Assortment size or duplication, in forms such as multiple product tastings,
multiple offerings of party snacks, duplicate buffet lines, and family dinners
with multiple dishes, stimulate eating.
g. Minimal variations in the size of serving bowls whenever multiple options and
sizes are present lead to eating more.
h. People generally do not keep track of how much food they consume. When
told, they are often surprised at how much they have consumed.
i. Large inventories of foods at home increase the quantity believed to be
appropriate for a given meal.
j. Small packages do not necessarily decrease consumption and can sometimes
actually increase it. Responsible companies should sell small packages
individually, rather than bundling them together in a larger container, because
the availability of multiple small packages leads to overconsumption.
5. Sometimes nutritional labels are misleading (presenting information for a small
serving size) or uninformative (using words like natural that do not mean anything.

***** Use Figures #15.4 and #15.5 Here*****

6. Direct-to-consumer pharmaceutical advertising has increased the consumption of

numerous categories of medications.
a. The pharmaceutical industry has developed voluntary restrictions regarding
direct-to-consumer advertising because they recognized it was too aggressive.

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 b. The Senate majority leader has called for a two-year moratorium on
advertising new drugs to consumers
c. One major pharmaceutical company has volunteered not to advertise new
drugs to consumers during their first year on the market.
d. Online search engines further complicate the direct selling of medications to
consumers.
i. The FDA urged pharmaceutical companies to include risk information
about drugs in the companies’ search advertisements (the short text
that appears besides the results of one’s Google search)
ii. Because Google limits such ads to 95 characters, it is unclear how this
can be done.
e. Because they can market products directly to consumers, pharmaceutical
companies are more eager than ever to “extend the life” of products that have
become consumer favorites, as the dates for patent expiration and the
availability of generic versions of these products near.

*****Use Review and Discussion Question #15.4 Here *****

Crafty Promotional Messages and Techniques

1. Marketers can use the knowledge of perception and learning to manipulate

consumer’s interpretations of marketing stimuli.
2. Because advertisers do not want to be associated with news broadcasts or programs
that cover serious issues, media companies may choose to shorten coverage of serious
or disagreeable topics.
3. Marketers may reduce the amount of products in packaging but leave prices
unchanged.
4. Covert marketing (also known as masked or stealth marketing) consists of
marketing messages and promotional materials that appear to come from independent
parties, although, in fact, they are sent by marketers.
a. Some maintain that covert marketing strategies often violate the FTC’s
definition of deceptive advertising, endorsement guidelines, and other
regulations pertaining to marketing, and believe the FTC should have clearer
rules.
b. Others argue that the widespread use of stealth marketing abuses consumers’
efforts to avoid advertising and will result in increased consumers’ distrust of
product information

*****Use Key Terms covert marketing and stealth marketing Here*****

5. Marketers increasingly use techniques that blur the distinctions between figure and
ground and make it more difficult for consumers to distinguish advertising from
entertainment content (e.g. product placements, positioning a TV commercial so
close to the storyline of a program consumers are unaware they are watching an
advertisement, advertorials, infomercials).
6. False or misleading advertising is also an issue.

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 a. Regarding accuracy, a toothpaste ad stating that “brand A is the best” is
considered an acceptable form of advertising “puffery” because consumers
generally understand that there is no credible way to determine what “best”
means.
b. Truth-in-advertising laws protect consumers from false advertisements.
c. Over time, the FTC has developed guidelines as to what constitutes deceptive
advertising, and it holds marketers responsible for determining their ads’
potential to mislead consumers.
d. The FTC encourages and investigates complaints by consumers and
companies regarding false or misleading ads. The FTC can also require
companies that have misled consumers through their advertising to run
corrective advertising.
e. In addition to the FTC, there is the National Advertising Review Council
(NARC), a self-regulatory group that monitors complaints from companies
and consumers regarding truth in advertising and often determines what ads
can or cannot state.
f. A large number of promotional violations occur in the marketing of drugs.
One study identified the three major categories of such violations:
i. Unsubstantiated effectiveness claims: Representing the drug as more
effective than the evidence available suggests; representing the drug as
useful in a broader scope than the research evidence indicates.
ii. Omitted risk information: Failure to reveal risks resulting from using
the drug correctly; failure to present information on side effects;
stating the risks in unclear language.
iii. Unsubstantiated superiority claims: Presenting the drug as more
effective or safer than others in spite of the fact that there is no
evidence supporting such a claim.

*****Use Key Terms product placements, advertorials, infomercials, truth-in-

advertising laws, deceptive advertising and corrective advertising Here; Use Table
15.2 Here; Use Review and Discussion Question #15.3 Here; Use Hands-on
Assignment Question #15.8 Here*****

Provocative Marketing

1. Many studies have focused on the use of objectionable themes in advertising,

2. Neuromarketing is being used to see how different parts of the brain react to
commercials.
3. Although marketers continuously sponsor ads portraying values or behaviors that
some (or many) consumers find distasteful or wrong, the importance of public
scrutiny must not be underestimated.

*****Use Learning Objective #15.4 Here; Use Key Term neuromarketing Here; Use
Table 15.4 Here*****

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Abusing Consumers’ Privacy

1. Consumers’ loss of privacy is an increasingly problematic ethical issue, as marketers

identify and reach out to increasingly smaller audiences through innovative media
and more sophisticated tracking.
a. Some retailers started testing new technology that allowed them to track
customers’ movements by following the Wi-Fi signals from customers’
smartphones.
i. The retailers gather data about in-store shoppers’ behavior and moods,
using video surveillance and signals from their cellphones and apps to
identify customers’ genders, how many minutes they spend in the
candy aisle and how long they look at merchandise before buying it.
ii. Retailers can also identify returning shoppers, because mobile devices
send unique identification codes when they search for networks. Thus,
stores can tell how repeat customers behave and the average time
between visits.
iii. When customers found out about being tracked, many complained and
said that they felt “stalked” and “creepy” while shopping under
surveillance.
b. The e-score is a digital calculation that evaluates people’s buying power and
value as consumers.
i. These scores are largely invisible to the public.
ii. Fueled by Google Analytics, this digital ranking of American society
is unlike anything that came before it.
iii. Unlike personal credit reports, consumers cannot find out what their e-
scores are.
c. Contextual advertising targets advertisements based on the Web page a
consumer is viewing or a search query the consumer has made, but does not
involve much data storage.

*****Use Review and Discussion Question #15.6 Here *****

2. The collection and dissemination of consumer information raises many privacy issues
and various governmental bodies have proposed measures to ensure consumers’
privacy.
a. The Federal Trade Commission recommended a “do not track” mechanism
that is similar to the national “do not call” registry.
b. It also proposed legislation regulating so-called data brokers, which compile
and trade a wide range of personal and financial data about millions of
consumers from online and offline sources.
c. The suggested legislation would give consumers access to information
collected about them and allow them to correct and update such data. Another
proposal is to let consumers choose whether they want their Internet browsing
and buying habits monitored.

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 d. The Digital Advertising Alliance—a group of digital advertising trade
organizations—designed a turquoise triangle in the upper right-hand corner of
banner ads. The AdChoices icon allows users who click on the turquoise
triangle to opt out of having their behavior tracked online.

*****Use Learning Objective #15.5 Here; Use Key Terms escore and contextual
advertising Here *****

Promoting Social Causes

1. Many not-for-profit organizations, including consumer advocacy groups, exist

primarily to promote socially beneficial behaviors such as contributing to charity,
using energy responsibly, and reducing such negative behaviors as using drugs,
discrimination, and drunk driving.
2. Many companies try to increase their credibility by being “good corporate citizens”
and integrating socially desirable practices into their operations.
a. A societal marketing program can create positive consumer attitudes toward
companies.
b. Perceptual fit between the sponsoring organization and the promoted cause(s)
enhances consumer involvement in the cause(s) and their purchase intentions.

*****Use Learning Objective #15.6 Here; Use Table #15.4 Here*****

3. The primary objective of many not-for-profit organizations is to promote socially

covetable behavior and discourage ones that produce negative outcomes.
4. Sometimes even government organizations try to induce public behavior that they see
fit.

*****Use Figures #15.6 - #15.9 Here *****

5. Marketers who implement ethical strategies do so in order “to do the right thing,” to
improve their image in the eyes of their constituencies, reduce scrutiny, and as an
alternative to the likelihood of government regulation.
6. Buyer’s dishonest behavior is another ethical concern.
a. Many stores have started charging restocking fees, limiting return policies,
and tracking abnormal return patterns because of buyers who bought items,
used them, and then returned them for a refund.
b. Air travelers are being creative to avoid checked luggage fees, charge airlines
hotel bills when they stayed with friends, claim expensive items were in the
checked luggage that was lost, or claim wheelchairs were damaged in the
cargo hold.

*****Use Table #15.5 Here *****

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REVIEW AND DISCUSSION QUESTIONS

15.1 Some say that targeting any group of consumers who are willing and able to
purchase a product is simply good marketing. For example, advertising very
sweet and fatty foods to young children is perfectly ok because children like
sweets and, when parents buy these products at their children’s requests, the
needs of both the kids and their parents are met and satisfied. What is your
reaction to this view?

Student answers will vary. This is a good opportunity to discuss their answers in
relationship to the guidelines developed by the Children’s Advertising Review Unit
of the Council of Better Business Bureau. Students might also discuss the
responsibility of the advertiser as well as the parent. There seems to be a general
consensus that marketers must take special care in advertising to children as they are
a vulnerable population. Another topic to be explored is the effect of children’s
advertising on parents. Studies show that parents significantly influence children’s
understanding and processing of advertisements.

Individual, Moderate, 15-20 minutes

Learning Objective 15.2: To understand how marketers can exploit consumers by
ways of targeting children and encouraging overeating and other forms of
irresponsible buying.
Learning Outcome 1: Define consumer behavior and describe its influence on
marketing practices
AACSB: Application of knowledge; Ethical understanding and reasoning

15.2 A soft drink company distributed cell phones to pre-adolescents in low-

income areas. The phones routinely received advertising messages for the drink.
Following criticism, the company said that the benefits of the disadvantaged
children’s having the cell phones (e.g., safety) outweighed any “exploitive
targeting’ considerations. Do you agree with the company’s position? Explain
your answer.

A lively conversation regarding intent and credibility should result from this question.
Answers might also relate to the societal marketing concept. It appears that the soft
drink company believes that the phones may enhance the well-being of the pre-
adolescents in the low-income areas. The question should be asked, “At what
expense?” Students need to consider if this is a form of overaggressive marketing.

Individual, Moderate, 15-20 minutes

Learning Objective 15.2: To understand how marketers can exploit consumers by
ways of targeting children and encouraging overeating and other forms of
irresponsible buying.

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 Learning Outcome 1: Define consumer behavior and describe its influence on
marketing practices
AACSB: Application of knowledge; Ethical understanding and reasoning

15.3 At a time when many consumers can avoid advertising messages via
sophisticated “time shifting” devices, marketers increasingly use product
placements (also known ads “branded entertainment”). In your view, is this a
wise strategy or not? Explain your answer.

Product placement results in the line between television shows and ads becoming
virtually non-existent. Students need to consider if this is an appropriate use or misuse
of advertising. Are consumer’s being manipulated in any way?

Individual, Moderate, 10-15 minutes

Learning Objective 15.3: To understand ethically questionable practices such as
covert marketing, manipulative exposure to advertising and truth-in-advertising
issues.
Learning Outcome 1: Define consumer behavior and describe its influence on
marketing practices
AACSB: Reflective thinking

15.4 Is it right to advertise prescription medications directly to consumers? Why

or why not?

As students read the text they will realize that consumers say they obtain most of the
information about medications from TV commercials. However, the pharmaceutical
industry has developed voluntary restrictions on selling pharmaceuticals directly to
consumers. The Senate majority leader has called for a two-year moratorium on
advertising new drugs to consumers and a pharmaceutical company has volunteered
not to advertise new drugs to consumers during their first year on the market. Do they
believe these restrictions and call for a moratorium are necessary?

Individual, Moderate, 10-15 minutes

Learning Objective 15.3: To understand ethically questionable practices such as
covert marketing, manipulative exposure to advertising and truth-in-advertising
issues.
Learning Outcome 1: Define consumer behavior and describe its influence on
marketing practices
AACSB: Reflective thinking; Ethical understanding and reasoning

15.5 Why is it important to study consumer ethics?

The purpose of studying consumer behavior is to understand why and how consumers
make their purchase decisions. Some critics are concerned that an in-depth
understanding of consumer behavior makes it possible for unethical marketers to
exploit human vulnerabilities in the marketplace and engage in other unethical

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 marketing practices in order to achieve individual business objectives. Studying
consumer ethics helps prevent this exploitation.

Individual, Moderate, 5-7 minutes

Learning Objective 15.1: To understand the meaning and importance of marketing
ethics and social responsibility.
Learning Outcome 1: Define consumer behavior and describe its influence on
marketing practices
AACSB: Reflective thinking

15.6 What are the privacy implications of the increasingly widespread monitoring
of online consumers by companies?

Loss of privacy is increasingly problematic. Individual profiles are developed

allowing for sophisticated analysis and the development of highly targeted and
persuasive messages. Should marketers be allowed to “track” your behavior? At what
point does information and privacy clash? Where does the “right” of the advertiser
conflict with the right for consumer privacy? Should marketers be responsible for
disclosure to consumers regarding information captured and the use of the
information?

Individual, Moderate, 15-20 minutes

Learning Objective 15.5: To understand how marketers abuse consumers’ privacy
and the measures that can stop such practices.
Learning Outcome 1: Define consumer behavior and describe its influence on
marketing practices
AACSB: Reflective thinking

HANDS-ON ASSIGNMENTS

15.7 Find, bring to class and discuss ads that depict each of the following:
a. Exploitive targeting of children
b. Overaggressive advertising
c. Direct-to-consumer advertising of pharmaceuticals
d. Cause-related marketing
e. Societal marketing by a not-for-profit group
f. Societal marketing by a for-profit company
g. Socially-undesirable representation

Instructor’s Discussion
This exercise allows students to find examples of advertising related to ethical issues
and societal marketing. You may want to have students vote for the best example in
each category.

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 Individual, Moderate, 30-45 minutes
Learning Objective 15.3: To understand ethically questionable practices such as
covert marketing, manipulative exposure to advertising and truth-in-advertising
issues.
Learning Outcome 1: Define consumer behavior and describe its influence on
marketing practices
AACSB: Application of knowledge; Ethical understanding and reasoning

15.8 Online, find three examples of advertising embedded within entertainment

content and discuss them in class.

Instructor’s Discussion
Again, ask students to vote on the best example. Be sure to ask students to defend
why the ad brought to class represents covert advertising.

Individual, Moderate, 60-90 minutes

Learning Objective 15.2: To understand how marketers can exploit consumers by
ways of targeting children and encouraging overeating and other forms of
irresponsible buying.
Learning Objective 15.3: To understand ethically questionable practices such as
covert marketing, manipulative exposure to advertising and truth-in-advertising
issues.
Learning Outcome 1: Define consumer behavior and describe its influence on
marketing practices
AACSB: Application of knowledge; Ethical understanding and reasoning

15.9 Compile a list of consumption behaviors that you consider unethical. For
each behavior listed, explain why you view it as wrong. Also, for each behavior
listed, discuss the possible reasons a person engaging in that practice may use to
justify doing so

Instructor’s Discussion
This exercise should provoke a lively discussion. Typically students disagree on what
is and is not unethical. Encourage students to thoroughly explain their reasoning for
believing a behavior is wrong.

Individual or Group, Moderate, 20-30 minutes

Learning Objective 15.1: To understand the meaning and importance of marketing
ethics and social responsibility.
Learning Objective 15.3: To understand ethically questionable practices such as
covert marketing, manipulative exposure to advertising and truth-in-advertising
issues.
Learning Outcome 1: Define consumer behavior and describe its influence on
marketing practices
AACSB: Analytical thinking; Ethical understanding and reasoning

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15.10 Visit the news section at www.caru.org. Select three of the press releases
featured there (other than those discussed in the chapter) and illustrate how
they depict the unethical applications of learning or perception concepts in
targeting children.

Instructor’s Discussion
The website lists quite a number of press releases. Students easily should be able to
find three that they are interested in. Many cases mention legal precedents for
decisions. Students may find this historical perspective fascinating.

Individual, Moderate, 15-20 minutes

Learning Objective 15.2: To understand how marketers can exploit consumers by
ways of targeting children and encouraging overeating and other forms of
irresponsible buying.
Learning Outcome 1: Define consumer behavior and describe its influence on
marketing practices
AACSB: Application of knowledge; Ethical understanding and reasoning

S.T.A.R. PROJECTS

Ethical Issues in Consumer Behavior

S.T.A.R. Project #1
As a student at a large university, you have been asked by a state senator to attend a
meeting to discuss youth and obesity. When you arrive at the meeting, you discover the
real purpose of the invitation. The state senator is considering sending a bill to the
legislature requiring that all colleges and universities in the state be required to use only
organic food in all residence halls. In addition, the senator wants to require a reduction in
sugars, fats and starches served and an increase in nutrients. The senator believes strongly
in the societal marketing concept and feels that it is the social responsibility of all
colleges and universities to. The reason students have been invited is to sign a petition
supporting this bill. Consider this issue from two perspectives. Given the senator’s
agenda was not clearly stated, was the invitation ethical? Is the senator’s bill truly
societal marketing? Why or why not?

Instructor’s Discussion

This scenario asks students to evaluate an ethical issue from different perspectives. The
reason for the meeting was not clear. Does this make a difference in how students
perceive the senator’s actual cause? Should students continue with the meeting?

Societal marketing requires that all marketers adhere to the principles of social
responsibility in the marketing of their goods and services. Yet, they should endeavor to
satisfy the needs and wants of their target markets in ways that preserve and enhance the
well-being of consumers and society as a whole. Lead students through their responses.

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Does organic food meet the qualifications of societal marketing? Will organic food
coupled with lower sugars, fats and starches reduce obesity? And, importantly, will
students be amenable to these changes and will the colleges and universities still be able
to operate profitably, given these requirements?

S.T.A.R. Project #2
Online advertisers are able to track your behavior. As you move through the internet,
advertisers track where you click, how frequently you visit a site and how long you spend
on a site. This knowledge enables advertisers to then tailor offers directly to you.

Your assignment is to consider tracking from your personal perspective and the
perspective of advertisers. Should your exploration through the internet be private or
public? Who is to decide? What rights do advertisers have?

After you have considered these questions (and others you consider relevant), visit the
Federal Trade Commission web site and read their recommendations on self-regulation
principles for online behavioral advertising. Do you agree or disagree with their position?

Instructor’s Discussion

This assignment is a good way for students to think about their own opinions and weigh
them against the desires of advertisers. They can then compare both to the Federal Trade
Commission’s report on tracking, targeting and technology.

Small Group Project

S.T.A.R. Project #3
Your group’s assignment is to find advertisements that members feel are unethical. Each
group member must bring at least three examples to the discussion. Debate among
members the ethical/unethical nature of the ads. Why might some members feel an ad is
ethical while others might disagree? Vote on each ad. Are some product categories more
susceptible to unethical advertising? Why or why not?

Instructor’s Discussion

This discussion makes the point regarding the sometimes difficulty of agreeing on ethical
or unethical advertising. You can guide the conversations by asking who should decide
on ethics policy and how ethics policies are created.

S.T.A.R. Project #4
Your assignment is to watch either two hours of television or a movie. While watching,
you are to record every incidence of product placement. Also record whether the product
placement was overt (the brand was named or pointed to) or less obvious. Which
placement was more effective? Why? Did or will the placement cause you to purchase
the product? How do you feel about the newly formed consumer advocacy group,

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Commercial Alert, which is asking for legislation requiring upfront disclosure of ad
designed as product placements?

An interesting twist would be to assign this project to students in pairs. However, the
members, making up the pair, cannot watch the shows together. After the members have
recorded their data, compare to see if both recognized the same number of product
placements and the same incidences of product placements.

Instructor’s Discussion
This project will aid the students in recognizing product placements. Lead them through
the following questions. Because their awareness is heightened, do they believe they see
more product placements? When they are more passively watching television, do they
believe they see less? Have the students explain their answers. Is one situation more
ethical than another? Why or why not? How do the students feel about Commercial
Alert’s call for legislation?

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