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International Column : Exclusive

Special Columns
Arindam Chaudhuri, Editor-in-Chief, 4Ps B&M Chief Consulting Editor's Desk
Rajita Chaudhuri
K.K.Srivastava Guest Column
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The need for an integrity based Marketing
Focussing solely on profit-making goals without paying attention to integrity is a risky proposition in reference to the brand’s reputation
Issue Date - 02/06/2011
Institutional and corporate communications have been impacted by a continuous flow of stories exposing abuse or even corruption at senior levels of business and government. As public scandals from all sectors of society across the world have become a regular feature in media and social commentary, so the demand for transparency by corporations and brands has grown. In light of such scandals, and as a result of long-standing international campaigns by NGOs to highlight social and environmental malpractices in corporate supply chains, many mainstream brands have now adopted social or environmental causes to support their brand propositions. What was once the preserve of the so-called “ethical brands” such as Max Havelaar, Patagonia, Ben and Jerry’s or the Body Shop has now become opportunities for many mainstream brands to demonstrate their integrity and responsibility in setting and enforcing ethical and sustainable standards in their value chains, especially with regard to the treatment off vulnerable workers and in environmental protection standards.

The sustainability agenda has recently become a strong primer for integrity in marketing as its claims relate both to environmental preservation and issues of social justice in the way people throughout the supply chain are treated. The emergence of so-called “green ethics” carries a moral force not because the environment per se is a moral agent but because people depend on the environment for their life and wellbeing. So-called “ethical” or “environmental” marketing is now closely connected with the social and environmental quality and impacts of a brand’s supply chain. Wal-Mart, for example, launched their Sustainable Product Index in July 2009 to survey its 100,000 global suppliers on sustainability and “people and community” criteria. ABInBev UK launched an advertising campaign in August 2009 to reposition its Stella Artois brand as being more environmentally responsible. The advertising theme was based on a simple message about the recyclability of their product packaging: aluminium cans and glass bottles. The marketing claims by these and other companies rely on an appeal to universal ideal of “doing good” – contributing beyond the immediate good of the corporation: “a more transparent supply chain” (Wal-Mart); “doing the right thing” (Marks and Spencer); “doing good” (McDonalds) and “making for a better world” (Stella Artois). Companies that make such claims need to be prepared to be scrutinised and give evidence for their claims for doing good.

Consumers expect brands to practice ethical values as well as brand values wherein the marketing strategies are based on brand promise and brand trust which explicitly support the ethical expectations of a brand’s performance. They choose brands because the brands make a promise about the provenance of the product they are buying: where it was produced, what it is made from, who made it and the conditions they worked in, and how it was brought from its place of manufacture to the place of sale. When we buy a coat from Marks and Spencer, we expect that the buttons will stay on and the seams will not unravel. But we also assume that it was not sewn by small children, and that the people who did make it were paid a living wage. Even if we do not consciously articulate these expectations, the Marks and Spencer brand stands as shorthand for all these assumptions. In announcing Coca-Cola’s decision in 2009 to show energy information (calories, kilocalories, kilojoules) per serving on the front of nearly all product packages, Muhtar Kent, Chairman and CEO, said that, “people expect facts about the products they consume to be both readily available and visible. This global commitment is about making it easier for consumers to quickly see the calorie information for our beverages.”

One of the constituents of a strong and trusted brand is the consistency of its attributes and ingredients over time. For food and beverage brands, distinctive ingredients and taste will be paramount whilst service brands will be primarily based on the consistency and distinctive nature of their customer service delivery. Brand trust is given by customers to a brand as a result of brand promises being faithfully delivered over time and, as many studies have shown, consistent employee behaviour is a critical success factor in ensuring brand promise and brand trust. The people of the organisation are thus engaged as employees of the brand-owning company or organisation in an explicitly ethical task. Brand trust has a value in building the intangible ‘asset value’ of a brand or its ‘brand equity’. Brand equity refers to the value of the brand measured as an intangible asset using financial and / or measures of its market strength such as market share which, in turn, is derived from attributes that commonly include quality, vision, differentiation, innovation and dynamism. Brand equity also comprises of the value attributed to a brand based on its ethical, social and environmental performance and market stature as measured by consumer survey.

The challenge to brand owners is to develop responsible brand managers and leaders within their organisations who have learnt the practice of ethical thought and consideration within the brand planning process and also in the language associated with brand positioning and branded frameworks. Ethical branding or marketing, whether central to the brand proposition, or supportive to it, requires moral reflection by brand owners and managers through which individuals call themselves and others to account in reaching decisions under circumstances in which neither laws nor prevailing institutional regulations are appropriate, or able, to provide the ethical direction for brand owners and managers to take in their stakeholder relationships and responsibilities. If brand marketers are focussed solely on profit-making goals without paying attention to the true meaning of integrity in brand building and branded communications then the brand’s reputation and its longer-term position and place in the market is placed at risk. The Confucian ideal is “righteousness before profits” and a recent study into the conduct of “Confucian entrepreneurs” in China and Hong Kong by Cheung and King concluded that Confucian entrepreneurs do not make money in an indiscriminate fashion but “try to encapsulate their profit-making activities within the boundaries of their moral beliefs.”
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