ETHICAL SELLING, MARKETING, AND ADVERTISING - - PowerPoint PPT Presentation

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ETHICAL SELLING, MARKETING, AND ADVERTISING - - PowerPoint PPT Presentation

ETHICAL SELLING, MARKETING, AND ADVERTISING http://www.youtube.com/watch?v=vstg5c3c3g8 ETHICS IN ADVERTISING Advertising is the practice of attracting public attention to a product or business for the purpose of increasing sales. Fine


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SLIDE 1

ETHICAL SELLING, MARKETING, AND ADVERTISING

http://www.youtube.com/watch?v=vstg5c3c3g8

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SLIDE 2

ETHICS IN ADVERTISING

  • Advertising is the practice of attracting

public attention to a product or business for the purpose of increasing sales.

– Fine line between:

  • Encouraging people to buy a car AND
  • Manipulating people to buy a car
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SLIDE 3

ETHICAL PROBLEMS IN ADVERTISING

  • The First Amendment to the Constitution

guarantees the right to free speech.

– Applies to individuals and organizations

  • Ads that are manipulative are legal but deceptive

– False Advertising – Puffery – Bait and Switch – Advertising to children – Telemarketing and Spam

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SLIDE 4

FALSE ADVERTISING

  • Is the practice of making statements

about products that the advertiser knows are not true.

– The claims can be about how a product:

  • Works
  • How it is made
  • How it will affect people

– Who buy it – Or use it

http://www.youtube.com/watch?v=PRNv hGND7Kc

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SLIDE 5

PUFFERY

  • Is the term used to describe statements

that are not outright lies, but merely exaggeration.

– The FTC allow puffery.

  • Their definition says the exaggeration can not be

determined.

http://www.youtube.com/watch?v=WcGfJMSsx20 http://www.youtube.com/watch?v=Ttde_4Eu6gU The Definition The Commercial

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SLIDE 6

BAIT AND SWITCH

  • The practice of advertising a product at a

low price while intentionally stocking

  • nly a limited number in hopes of luring

shoppers to buy more expensive items.

– Illegal but hard to prove

  • Raincheck – written guarantee that when the

product is back in stock, the consumer will get the discounted price.

http://www.youtube.com/watch?v=ZdbjJ85iv5E

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SLIDE 7

ADVERTISING TO CHILDREN

  • Children are specially vulnerable to

deceptive advertising.

– Generally trusting – Believe what adults tell them – Difficulty between fantasy vs. reality (Sponge Bob)

http://www.youtube.com/watch?v=WMDPql6rweo&list =PLC8470BC499E2CB2B

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SLIDE 8

TELEMARKETING AND SPAM

  • The practice of selling directly to

individuals through unsolicited phone calls, e-mails, or faxes.

– Can waste consumers $$$

  • Toner, paper and minutes on the phone
  • Laws have been passed

– “do not call” lists

  • Spam – option to open
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SLIDE 9

ETHICAL STANDARDS IN ADVERTISING

  • Code of Ethics –

– A written set of principles and rules intended to serve as a guideline for ethical behavior for individuals under the

  • rganization’s authority.
  • AAF ( The American Advertising Federation)

– 1984 – Code of Ethics and Principles

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SLIDE 10

TRUTH

  • Advertising shall tell the truth, and shall

reveal significant facts, the omission of which would mislead the public.

– Truth and Fairness go hand in hand in advertising.

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SLIDE 11

SUBSTANTIATION

  • Advertising claims shall be substantiated

by evidence in possession of the advertiser and advertising agency, prior to making such claims.

– Substantiation is the validation of advertising claims with objective data from independent research.

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SLIDE 12

COMPARISONS

  • To make false claims and comparisons

about competitors is unethical, and it is also illegal.

– Could be sued for libel.

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SLIDE 13

GUARANTEES AND WARRANTIES

  • “The big print giveth and the small print

taketh away” - Tom Waits

  • A guarantee is an assurance attesting to

the durability or quality of a service or product.

  • A warranty is a written promise to repair
  • r replace a product if it breaks or

become defective within a specific period of time.

http://www.youtube.com/watch?v=mEB7WbTTlu4

Tommy Boy : Stop at 1:30 sharp

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SLIDE 14

PRICE CLAIMS

  • Advertising shall avoid price claims

which are false or misleading, or saving claims which do not offer provable savings.

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SLIDE 15

TESTIMONIALS

  • An endorsement of a product by

someone claiming to have benefited from its use

– Often feature Celebrities and “experts”.

  • Paid for their endorsement

http://www.youtube.com/watch?v=5RuUZrJvLXs

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SLIDE 16

TASTE AND DECENCY

  • Advertising shall be free of statements,

illustrations or implications which are

  • ffensive to good taste or public decency.

– Edgy ads

  • Monitored closely by special interest groups.

– Boycott

Madonna’s Pepsi commercial that got cut because

  • f the real video.

http://www.youtube.com/watch?v=OFgSlZC4XDA

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SLIDE 17

LIMITATIONS OF THE ADVERTISING CODE OF ETHICS

  • “Vague rules are easier to bend, if one is

so inclined”

– What some people think about the AFF Code of Ethics

http://www.youtube.com/watch?v=2IpVDkg3kL8 Nutella Commercial – which is full of palm oil!

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SLIDE 18

ETHICS IN SELLING

  • When people sell goods and services

directly to the consumer.

http://www.youtube.com/watch?v=uTwtKRwlAzw Towers don’t all exist !

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SLIDE 19

ETHICAL PROBLEMS IN SELLING

  • Price Gouging
  • False Prizes
  • Commissions vs. “Straight” Commissions
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SLIDE 20

PRICE GOUGING

  • The practice of pricing a

product far above the normal market value on the assumption that consumers have no

  • ther way to buy the

product.

– Ex. Bags of ice during Hurricane Ike. $10

http://www.youtube.c

  • m/watch?v=R6ojYtKa

zgQ

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SLIDE 21

FALSE PRIZES

  • Common sales technique

– Seeks to trick potential customers into thinking they have won valuable prizes such as cash, cars, and cruises.

  • Ex. “free piano” – turns out to be a toy piano
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SLIDE 22

COMMISIONS VS. “STRAIGHT” COMMISSIONS

  • Commission – in addition to paying a salary
  • r hourly wage, the company rewards

salespeople with a percentage of the money from the sales they make

– The more they sell, the more they make

  • Straight Commission – salesperson’s

income is based entirely on what they sell

– Encourages deceptive and dishonest sales techniques

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SLIDE 23

PRINCIPLES OF ETHICAL SELLING

  • The Good News

– Most people in most professions are honest and honorable. – Most salespeople treat their customers with integrity and fairness

http://www.youtube.com/watch?v=ijGLyGa2Uhg

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SLIDE 24

THINK LONG-TERM

  • The majority of unethical business

actions and decisions are based on short-term thinking.

– Its all about the MONEY

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SLIDE 25

ELEVATE THE GOAL

  • People should

not be viewed as wallets to be exploited, but relationships to be built and nurtured.

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SLIDE 26

LEARN TO LISTEN

  • The traditional model of selling involves:

– Memorizing the key points of a sales talk – Presenting information to the customer – Hoping to convince the customer to listen and buy!

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SLIDE 27

THE END

http://www.youtube.com/watch?v=ccfJei-ohXI Ikea gives a warning, but the consumer still doesn’t LISTEN!