Textbook Chapter 2-3
Increasing Social Responsibility
Pages 47-53
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LESSON SUMMARY:
The lesson addresses the importance of social responsibility in marketing, defining key terms such as consumerism and ethics. It emphasizes that marketers must consider the societal impacts of their actions rather than focusing solely on profit. The growing expectation for businesses to be socially responsible reflects a broader understanding that long-term success is tied to addressing societal issues. With consumerism rising, organized groups of consumers have become influential in advocating for their rights, leading to increased awareness of ethical considerations in marketing practices.
The role of government regulation is highlighted as a significant factor in promoting social responsibility among businesses. Laws designed to protect consumers ensure that businesses consider their social impact. Additionally, companies are encouraged to adopt codes of ethics and engage in self-regulation to maintain responsible practices. Organizations like the Better Business Bureau assist in resolving consumer issues, while businesses that prioritize ethical behavior can enhance their reputation and customer trust.
Finally, the document underscores the ethical responsibilities marketers have towards their customers. It discusses how ethical lapses can harm consumers and society, emphasizing the need for accountability in marketing practices. Examples, such as ConAgra Foods’ proactive recall of potentially contaminated products, illustrate the importance of prioritizing consumer safety. Overall, the text advocates for a comprehensive approach to business ethics that fosters trust and positive relationships between businesses and their consumers.
The lesson addresses the importance of social responsibility in marketing, defining key terms such as consumerism and ethics. It emphasizes that marketers must consider the societal impacts of their actions rather than focusing solely on profit. The growing expectation for businesses to be socially responsible reflects a broader understanding that long-term success is tied to addressing societal issues. With consumerism rising, organized groups of consumers have become influential in advocating for their rights, leading to increased awareness of ethical considerations in marketing practices.
The role of government regulation is highlighted as a significant factor in promoting social responsibility among businesses. Laws designed to protect consumers ensure that businesses consider their social impact. Additionally, companies are encouraged to adopt codes of ethics and engage in self-regulation to maintain responsible practices. Organizations like the Better Business Bureau assist in resolving consumer issues, while businesses that prioritize ethical behavior can enhance their reputation and customer trust.
Finally, the document underscores the ethical responsibilities marketers have towards their customers. It discusses how ethical lapses can harm consumers and society, emphasizing the need for accountability in marketing practices. Examples, such as ConAgra Foods’ proactive recall of potentially contaminated products, illustrate the importance of prioritizing consumer safety. Overall, the text advocates for a comprehensive approach to business ethics that fosters trust and positive relationships between businesses and their consumers.
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Do Now: What Is Ethics In Marketing?
One famous example of business ethics is Johnson & Johnson's response to the 1982 Tylenol crisis. When seven people in Chicago died after taking Tylenol capsules that had been laced with cyanide by an unknown individual, Johnson & Johnson immediately launched a nationwide recall of 31 million bottles of Tylenol, despite the significant cost and the fact that the tampering was not their fault. The company worked closely with authorities and introduced tamper-resistant packaging, which became a standard in the pharmaceutical industry. Johnson & Johnson's swift and transparent response is often cited as a benchmark for ethical behavior in business, prioritizing consumer safety over profits.
Do Now 2: What is an example of government regulation in marketing?
An example of government regulation in marketing is the Federal Trade Commission's (FTC) truth-in-advertising laws in the United States. These regulations require that advertisements must be truthful, not misleading, and, when appropriate, backed by scientific evidence. For instance, if a company advertises that their product can provide health benefits or improve performance, they must have factual and scientific proof to support those claims. The FTC ensures that consumers are not misled by false advertising and can take action against companies that violate these laws, which may include fines or requiring the company to change or discontinue misleading advertisements.
Quiz 1: Textbook Chapter 2-3 Increasing Social Responsibility
Section: Consumer Protection
Directions: Your first quiz is on the first section of Chapter 2-3 titled Consumer Protection. This section goes from pages 47-49. Watch the video below, "What Is Consumerism" (2:55) read the summary and take the quiz below.
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Summary Of Consumer Protection (Textbook Pages 47-49)
The text discusses consumer protection and the role of businesses in being socially responsible. It highlights that marketing activities can have both positive and negative effects on society, and that businesses must address societal needs to remain successful in the long term. The text identifies three major ways that social responsibility in business is increasing: consumerism, government regulation, and improved business practices.
Consumerism refers to the organized actions of consumer groups to influence business practices. This movement gained significant momentum in the 1960s with President Kennedy's Consumer Bill of Rights, which established key rights for consumers, such as the right to information, safe products, choices, and the ability to communicate with businesses and government. Consumer actions like boycotts, lobbying, and education have empowered consumers to protect their rights and influence businesses.
Government regulation plays a key role in ensuring businesses comply with laws designed to protect consumers, such as safety and fair practices. These regulations help maintain a balance between business operations and societal well-being.
The text discusses consumer protection and the role of businesses in being socially responsible. It highlights that marketing activities can have both positive and negative effects on society, and that businesses must address societal needs to remain successful in the long term. The text identifies three major ways that social responsibility in business is increasing: consumerism, government regulation, and improved business practices.
Consumerism refers to the organized actions of consumer groups to influence business practices. This movement gained significant momentum in the 1960s with President Kennedy's Consumer Bill of Rights, which established key rights for consumers, such as the right to information, safe products, choices, and the ability to communicate with businesses and government. Consumer actions like boycotts, lobbying, and education have empowered consumers to protect their rights and influence businesses.
Government regulation plays a key role in ensuring businesses comply with laws designed to protect consumers, such as safety and fair practices. These regulations help maintain a balance between business operations and societal well-being.
Directions (Continued): After you watch the video, read the chapter section and the summary, take the quiz on Schoology. You can preview the questions below.
Quiz 2: Chapter 2-3
Increasing Social Responsibility
Section: Improving Practices
Directions: Your second quiz is on the second section of Chapter 2-3 titled Improving Practices. This section goes from pages 49-51. Watch the video below titled "Explain Ways By Which Businesses Improve Their Own Practices" (2:47), read the summary and take the quiz below.
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Summary of Improving Practices (pages 49-51)
Improving Business Practices: Businesses recognize their responsibility to consumers and society, working to avoid increased regulation and taxes by improving practices through codes of ethics, self-regulation, and social action.
Improving Business Practices: Businesses recognize their responsibility to consumers and society, working to avoid increased regulation and taxes by improving practices through codes of ethics, self-regulation, and social action.
- Code of Ethics: A set of standards that guide ethical business behavior, ensuring honesty and fairness. Industry organizations, like the American Marketing Association, develop codes of conduct that promote responsible business practices.
- Self-Regulation: Businesses and industries create procedures to address consumer complaints directly, promoting accountability. Organizations like the Better Business Bureau help resolve issues between businesses and consumers, while some industries establish independent panels to ensure fair resolutions.
- Social Action: Companies engage in social responsibility by investing time and money to help communities, with examples like Microsoft's charitable donations and McDonald's support of Ronald McDonald Houses for families in need.
Directions (Continued): After you watch the video, read the chapter section and the summary, take the quiz on Schoology. You can preview the questions below.
Quiz 3: Chapter 2-3
Increasing Social Responsibility
Section: Ethics In Marketing
Directions: Your third quiz is on the second section of Chapter 2-3 titled Ethics In Marketing. This section goes from pages 51-53. Watch the video below "Discuss How Ethical Issues Affect Marketers Professional Responsibilities" (2:49) , read the summary and take the quiz below.
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Main Points "Ethics In Marketing": (Textbook Pages 51-53)
- Ethics in Business: Business ethics have gained attention, and most businesspeople act ethically, though the unethical actions of a few can damage the overall reputation of the business community. Ethical behavior is valued in business, and companies are expected to act responsibly.
- Responsibility to Customers: Marketers have a unique responsibility because they directly influence customer spending. Ethical behavior requires honesty and fairness in dealing with customers, employees, and competitors. Companies, like ConAgra Foods, that act responsibly by recalling products for safety reasons demonstrate ethical decision-making.
- Harm and Accountability: Unethical marketing can harm customers and society. It can also lead to legal consequences for individuals and businesses. Marketers must focus on what benefits everyone in a transaction, not just the business. Some companies are implementing education programs to ensure employees make ethical decisions and improve the overall image of business ethics.
Directions (Continued): After you watch the video, read the chapter section and the summary, take the quiz on Schoology. You can preview the questions below.
Higher Level Question
Task: Critique the effectiveness of consumer boycotts as a method of influencing business practices.
Directions: Read the article below. Formulate a short and well written three paragraph essay that informs the reader your opinion on whether boycotting is still an effective strategy; one that can directly change a business. I recommend that you write your response in the following format.
Paragraph 1: Define what a boycott is and explain why boycotting a product/company/entity can be a practice that leads to change.
Paragraph 2: Give an example of when boycotting has been highly effective and when it has failed.
Paragraph 3: Form your own opinion on whether or not boycotting is still an effective strategy in the present.
Directions: Read the article below. Formulate a short and well written three paragraph essay that informs the reader your opinion on whether boycotting is still an effective strategy; one that can directly change a business. I recommend that you write your response in the following format.
Paragraph 1: Define what a boycott is and explain why boycotting a product/company/entity can be a practice that leads to change.
Paragraph 2: Give an example of when boycotting has been highly effective and when it has failed.
Paragraph 3: Form your own opinion on whether or not boycotting is still an effective strategy in the present.
What Is A Boycott And Why Would Someone Want To Boycott A Product, Company Or Entity?
A boycott is a form of protest in which individuals or groups refuse to buy, use, or support a product, company, or entity to express disapproval or demand change. It is a nonviolent tactic used to apply economic and social pressure on businesses, governments, or organizations that are perceived to be engaging in unethical, harmful, or unjust practices. Boycotts can be organized by activists, advocacy groups, or even grassroots movements, and they often gain traction through social media and public campaigns.
People may choose to boycott for various reasons, including labor rights violations, environmental concerns, human rights abuses, political stances, or discriminatory policies. For example, consumers may stop purchasing from a company that exploits workers, harms the environment, or funds controversial political causes. The goal of a boycott is to create financial or reputational consequences that compel the targeted entity to change its practices, policies, or affiliations in response to public pressure.
People may choose to boycott for various reasons, including labor rights violations, environmental concerns, human rights abuses, political stances, or discriminatory policies. For example, consumers may stop purchasing from a company that exploits workers, harms the environment, or funds controversial political causes. The goal of a boycott is to create financial or reputational consequences that compel the targeted entity to change its practices, policies, or affiliations in response to public pressure.
10 Examples Of When Boycotts Worked
Here are 10 notable examples where product boycotts were successful in influencing corporate behavior or policy changes:
1. Montgomery Bus Boycott (1955-1956)
1. Montgomery Bus Boycott (1955-1956)
- After Rosa Parks' arrest, African Americans in Montgomery, Alabama, boycotted the city's bus system for over a year, leading to the desegregation of public buses.
- Nestlé faced a global boycott over its aggressive marketing of infant formula in developing countries, which was linked to malnutrition and infant deaths. The campaign led to the implementation of the WHO’s International Code of Marketing of Breast-milk Substitutes.
- Consumers and companies worldwide boycotted South African goods, including banks and businesses, contributing to the economic pressure that helped end apartheid in 1994.
- Consumer outcry over Nike's use of sweatshops and child labor forced the company to improve working conditions and create a corporate responsibility department.
- Activist Ralph Nader’s campaign against unsafe cars, particularly the Chevrolet Corvair, led to consumer backlash and forced GM to improve vehicle safety.
- Pressure from environmental and human rights activists over Shell's ties to South Africa and its role in the execution of Nigerian activist Ken Saro-Wiwa led to major reputational damage, forcing the company to change its policies.
- Following accusations of unethical business practices, including undercutting a New York taxi strike protesting Trump’s travel ban, thousands of users deleted the Uber app. This led to leadership changes, including the resignation of CEO Travis Kalanick.
- The Deepwater Horizon disaster led to widespread consumer backlash and boycotts of BP gas stations, forcing the company to allocate billions of dollars for environmental cleanup and reparations.
- After the company's CEO expressed opposition to same-sex marriage, LGBTQ+ groups and allies boycotted the chain, leading to changes in corporate donations and a reduction in politically charged statements.
- Environmentalists and Indigenous groups boycotted banks and companies supporting the pipeline. The sustained pressure led to the Biden administration canceling the permit in 2021.
10 Examples Of When Boycotts Failed
Here are 10 examples of boycotts that were largely ineffective in achieving their intended goals:
1. Facebook Ad Boycott (#StopHateForProfit, 2020)
1. Facebook Ad Boycott (#StopHateForProfit, 2020)
- Major brands like Coca-Cola and Unilever paused advertising on Facebook to pressure the platform to take stronger action against hate speech and misinformation. However, Facebook’s revenue was barely affected, as small businesses continued to buy ads.
- Some conservatives boycotted Heinz because of Teresa Heinz Kerry’s connection to John Kerry’s 2004 presidential campaign. However, Heinz’s sales were unaffected, as the brand remained dominant in the ketchup market.
- Starbucks has faced boycotts over political stances, such as supporting LGBTQ+ rights, hiring refugees, and banning open carry in stores. Despite repeated calls for boycotts, the company has continued to thrive financially.
- After Nike featured Colin Kaepernick in an ad campaign, some conservatives burned Nike products and vowed to boycott the brand. However, Nike’s stock surged, and sales increased, proving the boycott ineffective.
- After Goya’s CEO praised Donald Trump, some consumers called for a boycott. However, the company saw a spike in sales as Trump supporters countered the boycott by purchasing more Goya products.
- McDonald's has faced multiple boycott attempts, especially during the 2014 and 2023 Israel-Palestine conflicts. Despite social media campaigns urging consumers to avoid the fast-food chain, McDonald's remains one of the largest and most profitable global restaurant brands, showing little financial impact from these boycotts.
- Critics of Amazon’s labor practices have called for consumer boycotts, but the convenience and dominance of Amazon's services have made it difficult for most consumers to avoid the platform, keeping its sales high.
- In response to France’s opposition to the Iraq War, some Americans boycotted French wine. However, French wine exports remained strong, as other global markets compensated for any lost U.S. sales.
- Pepsi faced backlash after an ad featuring Kendall Jenner was accused of trivializing the Black Lives Matter movement. While the company pulled the ad, the boycott did not hurt Pepsi’s long-term sales or brand value.
- Some conservative groups called for a boycott over the release of Cuties, a French film accused of sexualizing young girls. Despite temporary cancellations, Netflix's subscriber base and revenue continued to grow.
How effective are boycotts as a tactic to force change?
Boycotts can be a powerful tool for drawing attention to social, political, or ethical issues. They serve as a means for consumers to express discontent and can generate significant media coverage that elevates public awareness. In some cases, sustained boycotts have pressured companies to address concerns—whether by revising policies, improving labor practices, or altering marketing strategies—in order to mitigate reputational risks and safeguard their market share.
However, the overall effectiveness of boycotts in forcing change varies considerably. While some boycotts have led to tangible outcomes, such as policy shifts or corporate restructuring, others have had limited impact due to factors like strong brand loyalty, diversified revenue streams, or the ability for consumers to easily shift their purchasing habits. When the economic influence of a boycott is diluted, companies may opt to weather the storm rather than implement sweeping changes, particularly if they calculate that the financial repercussions will be short-lived.
In essence, boycotts are most effective when they are well-organized, garner widespread participation, and are backed by compelling evidence of wrongdoing that resonates with a broad audience. They are less likely to succeed if the affected entity has entrenched market dominance or if consumer alternatives are limited. Ultimately, the success of a boycott in driving change often hinges on a delicate balance of public sentiment, sustained economic pressure, and the strategic responsiveness of the targeted organization.
However, the overall effectiveness of boycotts in forcing change varies considerably. While some boycotts have led to tangible outcomes, such as policy shifts or corporate restructuring, others have had limited impact due to factors like strong brand loyalty, diversified revenue streams, or the ability for consumers to easily shift their purchasing habits. When the economic influence of a boycott is diluted, companies may opt to weather the storm rather than implement sweeping changes, particularly if they calculate that the financial repercussions will be short-lived.
In essence, boycotts are most effective when they are well-organized, garner widespread participation, and are backed by compelling evidence of wrongdoing that resonates with a broad audience. They are less likely to succeed if the affected entity has entrenched market dominance or if consumer alternatives are limited. Ultimately, the success of a boycott in driving change often hinges on a delicate balance of public sentiment, sustained economic pressure, and the strategic responsiveness of the targeted organization.
Were Boycotts More Effective In The Past?
Boycotts in the 20th century were often highly effective because they targeted businesses and industries that were more vulnerable to coordinated consumer actions. Companies had fewer revenue streams, and brand loyalty was not as entrenched as it is today. Additionally, many of the most successful 20th-century boycotts, such as the Montgomery Bus Boycott (1955-1956) and the anti-apartheid boycotts (1980s-1990s), were deeply tied to broader social justice movements, making them more impactful. The lack of globalized supply chains also meant that a boycott in one region could cause significant financial distress for a company.
In contrast, 21st-century boycotts have had mixed results, largely due to globalization, corporate diversification, and the rise of digital consumerism. Many multinational corporations today operate in various industries and countries, making them less susceptible to localized boycotts. For example, Amazon, despite facing multiple boycott attempts over labor practices, continues to thrive because of its widespread influence in e-commerce, cloud computing, and entertainment. Additionally, the rise of social media has made it easier to spread boycott movements, but it has also led to "performative" boycotts, where individuals express outrage online but do not necessarily follow through with long-term consumer action.
Another key difference is that modern companies often engage in corporate social responsibility (CSR) initiatives and public relations efforts to mitigate the impact of boycotts. When faced with backlash, many businesses issue apologies, revise policies, or shift public focus rather than suffer major financial losses. For example, Nike faced calls for a boycott in 2018 after featuring Colin Kaepernick in an ad, yet sales increased because the controversy actually strengthened its brand appeal among its core audience. This demonstrates how companies today can strategically navigate boycotts rather than succumb to them.
Overall, boycotts were generally more effective in the 20th century because businesses were more dependent on specific consumer bases, and public pressure had a more immediate impact. While boycotts still have the potential to succeed in the 21st century, they are often diluted by corporate resilience, alternative markets, and digital activism that does not always translate into economic consequences. For a modern boycott to work, it must be well-organized, sustained, and supported by widespread economic action rather than just social media outrage.
In contrast, 21st-century boycotts have had mixed results, largely due to globalization, corporate diversification, and the rise of digital consumerism. Many multinational corporations today operate in various industries and countries, making them less susceptible to localized boycotts. For example, Amazon, despite facing multiple boycott attempts over labor practices, continues to thrive because of its widespread influence in e-commerce, cloud computing, and entertainment. Additionally, the rise of social media has made it easier to spread boycott movements, but it has also led to "performative" boycotts, where individuals express outrage online but do not necessarily follow through with long-term consumer action.
Another key difference is that modern companies often engage in corporate social responsibility (CSR) initiatives and public relations efforts to mitigate the impact of boycotts. When faced with backlash, many businesses issue apologies, revise policies, or shift public focus rather than suffer major financial losses. For example, Nike faced calls for a boycott in 2018 after featuring Colin Kaepernick in an ad, yet sales increased because the controversy actually strengthened its brand appeal among its core audience. This demonstrates how companies today can strategically navigate boycotts rather than succumb to them.
Overall, boycotts were generally more effective in the 20th century because businesses were more dependent on specific consumer bases, and public pressure had a more immediate impact. While boycotts still have the potential to succeed in the 21st century, they are often diluted by corporate resilience, alternative markets, and digital activism that does not always translate into economic consequences. For a modern boycott to work, it must be well-organized, sustained, and supported by widespread economic action rather than just social media outrage.