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REVIEW
2-1. What are business ethics, and why is this an important topic?
Business ethics are rules of conduct that guide actions in the marketplace. These are the
(2 minutes, Chapter Objective 1, AACSB: Reflective Thinking)
2-2. The economics of information perspective argues that advertising is important. Why?
(2 minutes, Chapter Objective 1, AACSB: Reflective Thinking)
2-3. State two important criticisms of marketing and provide the pros and cons for each.
Some feel that marketers contribute to the moral breakdown of society when they promote
Another criticism of marketing is that it manipulates the masses. This includes online
(5 minutes, Chapter Objective 1, AACSB: Reflective Thinking)
2-4. Give two examples of important legislation that relate to U.S. consumers.
(2 minutes, Chapter Objective 2, AACSB: Application of Knowledge)
2-5. Define social marketing, and give an example of this technique.
(1.5 minutes, Chapter Objective 2, AACSB: Application of Knowledge)
2.6 What is the primary difference between transformative consumer research and other kinds
of consumer research?
Transformative consumer research promotes research that includes the goal of helping
(2 minutes, Chapter Objective 2, AACSB: Reflective Thinking)
2-7. Why is market access an important aspect of consumer well-being? What are some
important reasons why consumers can experience limited market access?
minutes, Chapter Objective 2, AACSB: Reflective Thinking)
2-8. What is greenwashing, and why is it a problem for marketers?
Greenwashing is the promotion of environmentally friendly products, but often, the claims
(2 minutes, Chapter Objective 3, AACSB: Reflective Thinking)
CONSUMER BEHAVIOR CHALLENGE
Discuss
2-9. The Culture Jammers Manifesto proclaims opposition to the “mind-polluters”: “On the
rubble of the old culture, we will build a new one with non-commercial hear and should. “
What’s your take on “culture jamming;
do advertisers deserve to be parodied?
Students will have mixed views about this topic. Students should identify parody and culture
(20 minutes, Chapter Objective 2, AACSB: Reflective Thinking)
2-10. Should scientists who study consumer behavior remain impartial, or is it appropriate for
them to become involved in the topics they research like those who adhere to the
transformative consumer research perspective?
Students will have varied opinions on this topic. Students should be able to identify and
(20 minutes, Chapter Objective 2, AACSB: Reflective Thinking)
2-11. Because of higher competition and market saturation, marketers in industrialized
countries try to develop third-world markets. Asian consumers alone spend $90 billion a
year on cigarettes, and U.S. tobacco manufacturers push relentlessly into these markets. We
find cigarette advertising, which often depicts glamorous Western models and settings, just
about everywhere – on billboards, buses, storefronts, and clothing – and tobacco companies
sponsor many major sports and cultural events. Some companies even hand out cigarettes
and gifts in amusement areas, often to preteens. Should governments allow these practices,
even if the products may be harmful to their citizens or divert money that poor people
should spend on essentials? If you were a trade or health official in a third-world country,
what guidelines, if any, might you suggest to regulate the import of luxury goods from
advanced economies?
Students will have a variety of views on this topic. Student should indicate regulations and
(20 minutes, Chapter Objective 2, AACSB: Reflective Thinking)
2-12. The chapter discusses the practice of serial wardrobing, where people return an outfit
after they wear it for a special occasion such as a formal. What do you think of this practice?
Is it OK to use an expensive product once and then get your money back?
Students should explain how serial ward robing constitutes consumer theft and fraud.
(20 minutes, Chapter Objective 4, AACSB: Reflective Thinking)
2-13. “College students’ concerns about the environment and vegetarianism are just a passing
fad: a way to look ‘cool.’ ” Do you agree?
Students will have mixed views about this subject. What they need to see is that a fad that
(20 minutes, Chapter Objective 4, AACSB: Reflective Thinking)
2-14. A case involving Wendy’s fast-food chain made national headlines when a woman claimed
she had found a finger in her bowl of chili. The restaurants became the butt of jokes (some
said they served nail clippers with their food instead of forks), and sales dropped dramatically
at the company’s franchises. This forced layoffs and reduced hours for many employees –
until the woman was arrested for fraud. Consumers commonly file lawsuits against
companies to claim damages if a product or service didn’t work as expected. In some cases,
the defendant just settles the suit to make it go away because it costs more to mount a defense
than to just pay damages. Do we have too many frivolous lawsuits? Does our justice system
adequately meet the needs of both consumers and companies in terms of how it awards
damages?
Student responses will vary but the instructor can use this discussion to address major
(20 minutes, Chapter Objective 3, AACSB: Reflective Thinking)
2-15. Nonprofit organizations routinely rely on generous corporate donations, and it is common to
name facilities after benefactors. The Nationwide Children’s Hospital in Ohio is no exception;
its name recognizes the insurance company’s $50 million donation. Now the hospital is adding
the Abercrombie & Fitch Emergency Department and Trauma Center and there is the Limited
Too & Justice Main Lobby. The Campaign for a Commercial-Free Childhood opposes this
partnership. The group’s director commented, “Abercrombie & Fitch is really among the worst
of corporate predators. A company with such cynical disregard for children’s well-being
shouldn’t be able to claim the mantle of healing. . . . And, personally, I find it very concerning
that they named their hospital after an insurance company.” What do you think? Is this over
the line, or does it matter where the money comes from so long as the result is beneficial?
Students will vary in their response to this challenge as both sides present important points.
(5 minutes, Chapter Objective 1, AACSB: Ethical Understanding and Reasoning Abilities)
2-16. From time to time advertisers use dark humor to get their messages across, as when a lonely
calorie, repairman, or robot considers suicide. Or, an ad may imply that a shoppers are
“mentally ill” if they pay retail prices. Are these appeals a legitimate way to communicate a
message, and if so under what circumstances?
(3 minutes, Chapter Objective 1, AACSB: Ethical Understanding and Reasoning Abilities)
Apply
2-17. Will consumers trade lower prices for less privacy? Car owners now can let insurance
companies monitor their driving using a new technology in exchange for lower rates. Customers
who sign up for Progressive’s TripSense program get a device the size of a Tic Tac box to plug
into their cars. The device will track speed and how many miles are driven at what times of day.
Every few months, customers unplug the device from the car, plug it into a computer, download
the data, and send them to the company. Depending on results, discounts will range from 5 to 25
percent. In Great Britain, a major insurer is testing a program called Pay as You Drive. Volunteers
will get a device the size of a Palm computer installed in their cars. The gadget will use global
positioning satellite technology to track where the car goes, constantly sending information back
to the insurance company. Cars that spend more time in safer areas will qualify for bigger
discounts. Of course, the potential downside to these efforts is that the insurance companies may
be able to collect data on where you have driven, how long you stayed in one location, and so on.
Conduct a poll of 10 drivers of various ages where you describe these programs and ask
respondents if they would participate to receive a discount on their insurance premiums. What
reasons do they give pro and con?
This question of exchanging privacy for lower prices (or convenience, or any of a number of other
(10 minutes, Chapter Objective 3, AACSB: Ethical Understanding and Reasoning Abilities)
2-18. Many college students “share” music by downloading clips from the Internet. Interview at
least five people who have downloaded at least one song or movie without paying for it. Do they
feel they are stealing? What explanations do they offer for this behavior? Try to identify any
common themes because of these interviews. If you were devising an ad campaign to discourage
free downloading, how might you use what you have learned to create a convincing message?
Obviously, ethical issues of right and wrong should emerge here. These issues should reflect the
persuade consumers that their justified behavior is wrong.
(5-10 minutes, Chapter Objective 2, AACSB: Ethical Understanding and Reasoning Abilities)
CASE STUDY TEACHING NOTES
Chapter 2 Case Study:
Marketing Responsibility: Patagonia and P&G’s Always
Redefine What It Means to Be Transparent and Authentic
Summary of Case
Marketing faces challenges and criticism on many fronts. As identified in Chapter 2 questions
directed at the marketing field include:
Does marketing create materialism? Does it lead to confusion between needs and wants?
Is it ethical to market products that may have a negative impact on consumers’ health?
Do marketers mislead consumers or perpetuate stereotypes with their marketing
messages?
Does marketing lead to an invasion of computer privacy?
Do companies and brands misuse natural resources for products and packaging? Do they
engage in greenwashing?
Do companies take advantage of questionable labor practices in their quest to keep costs
and prices down?
Three companies that have recently been in the spotlight about their work to change
perceptions about the role of marketing are Panera Bread, Patagonia, and Proctor & Gamble
with its’ Always brand.
Patagonia:
Patagonia, an apparel and sporting goods company, has long been regarded as cutting-edge when it
comes to environmental and social responsibility. In fact, it is an accredited and founding member of
the Fair Labor Association. Now Patagonia is taking on a difficult task of trying to be even more
transparent about its’ supply chain and related labor practices in an industry knows for its abuses of
workers.
As Gillian White details in “Your Clothes Are Made With Exploited Labor”, since 2007 Patagonia
has worked diligently, along with Verite, a nongovernmental organization that works on labor issues,
to make improvements in the practices of the company’s first-tier suppliers. There are the suppliers
with whom Patagonia works directly to product its’ apparel. Through these efforts it was able to
reduce the number of first-tier suppliers from 108 to 75, which improved the company’s ability to
have more control over how these companies treat workers.
However, in 2011 Patagonia’s own extensive audits uncovered new supply chain problems with
human trafficking, forced labor, and exploitation. They are now trying to go beyond the gains made
in their previous work with the first-tier suppliers. Their new focus is on suppliers buried more
subtly in the complicated apparel supply chains: mills and suppliers of raw materials. Patagonia has
asked Verite to help with additional audits. They have also increased their overall corporate social
responsibility effort. In 2013 they invited industry peers for a discussion of forced labor issues in the
apparel industry, unfortunately only 7 of the 40 invited companies chose to participate.
Patagonia’s COO Doug Freeman commented, “We think people will be disappointed at ongoing
issues in Patagonia’s supply chain, but feel that our transparency will pay off. We want to be really
honest and dive deeply into this issue, breaking trails for the rest of the industry.” Clearly they have
a lot at stake because their branding identity is so closely tied to their leadership in social
responsibility.
According to Gillian White, “Patagonia’s admission stands out in that it comes from a brand
considered a leader in the movement of ethical production.” However, the good news as she
describes it is that “Patagonia’s name continually comes up as one of the few brands that seek to
take the high road by choice rather than by necessity. By comparison, many companies aren’t
prepared or proactive when it comes to rooting out forced labor at all levels”
And Dan Viederman, CEO of Verite, confirms that “there are few, if any, brands that have taken up
the mantle of eradicating trafficking, at any level, without first being prodded by potentially
embarrassing and illegal findings.” Patagonia appears to be one of those few.
For now, Patagonia continues the difficult struggle to monitor and actively work to improve
conditions throughout every level of its supply chain. They remain determined to set the bar high
and to live up to their mission statement: Build the best product, cause no unnecessary harm, use
business to inspire and implement solutions to the environment crisis.
P&G’s Always
P&G’s Always feminine care campaign, “Like a Girl,” has generated a great deal of attention in the
marketplace recent: 58 million views on YouTube and the first feminine care product Super Bowl
ad. In addition, the campaign has won a number of prestigious awards, including being the sole
winner in the 2015 Effie Awards GoodWorks Brand category. The award was created to recognize
marketers using their platform for good through purpose-driven marketing campaigns. At the
Cannes Lions International Festival of Creativity, considered the Academy Awards for advertising,
the campaign won a Glass Lion prize and the Grand Prix award in the PR category. The Glass Lion
prize is a new category, introduced in 2015, to honor campaigns that address issues related to gender
inequality and prejudice.
P&G is working to target women with more realistic and empowering messages. The campaign
focuses on what young women, boys, and girls think it means to do something “like a girl.” This is
an especially important question given the fact that research has documented a drop in self-esteem
as girls grow into young women. The ads have connected well with women and sparked a great deal
of conversation, much of it driven by the hashtag #LikeAGirl. The campaign’s message is all about
changing the like-a-girl phrase from an insult into something that empowers and inspires.
Allison Arden points to a comment about the campaign made by Ken Wheaton in an Advertising
Age column. Wheaton said, “It’s an eye-opener-which is something you don’t often get in
advertising of any kind. It made me-a 21st century, non-PC male born and raised in the South—
reconsider my own word choices.” Arden shared reflections from several experts on why the Always
campaign is a good example of effective purpose-driven marketing. Their comments included the
campaigns ability to identify its own insight to create a purpose of its own, create a compelling
message that will be meaningful over an extended period of time, and understand the importance of
unusual media placements that put the message in front of audience in a way that made a statement.
Arden praises the campaign for “effectively setting the Always brand apart, while also changing
behaviors and making us pause to consider the power of our words.”
Suggested Discussion Questions
CS2-1. Do you believe that consumers consider a brand’s supply chain ethics when they purchase
apparel? Do consumers bear any responsibility for the ways in which laborers in the apparel
industry are treated? Would you be willing to pay a premium for a brand that was transparent about
their efforts to ensure that laborers are paid a fair wage and treated decently?
CS2-2. In Allison Ardens Advertising Age article about the Like-a-Girl campaign, she talks about the
need for purpose driven marketing campaigns to feel authentic. To what extent has the Like-a-Girl
campaign achieved this goal? What are the unique marketing challenges for a feminine care product
overall?Additional Support Material
STUDENT PROJECTS
Individual Projects
Have students explain what it means to be a green consumer. They could report on what they have
done to be “green” and how their behaviors have changed. Have they tried to influence
anybody else to go “green” and how?
The chapter introduces the idea of green marketing, but student perceptions of green
(5 minutes, Chapter Objective 5, AACSB: Reflective Thinking)
Each group should locate an example of a company that is heavily involved in social or green
marketing. Make a report on the activities of the company. Compare this company to a
direct competitor that is not so extensively involved in such activities. What are the
advantages/disadvantages that the social/green approach has over the other?
Student responses should reflect an understanding of what social or green marketing is.
minutes, Chapter Objective 5, AACSB: Analytic Skills)
eLAB
1. Visit a website that includes a quiz or test of materialism (ex.
http://www.expertrating.com/quizzes/Materialism-Test.asp or find it at
www.Quizilla.com) and take the test to evaluate how materialistic you are.
Students are likely to get different responses, depending on the importance of possessions
(20 minutes, Chapter Objective 1, AACSB: Reflective Thinking)
2. Go to www.moveon.org. What is the main variable that this site uses to segment the
American public? What is the resulting segment to which this site is attempting to
appeal? Extensively, describe this segment in terms of demographic and psychographic
variables. What issues seem to be raised on this site? If you were an advertiser, would it
be a good idea to sponsor a message on this site? Explain.
Moveon.org is a civic action group that segments the American public based on political
ideals. Opinions are one of the facets of psychographic segmentation (activities, interests,
(15 minutes, Chapter Objective 5, AACSB: Analytic Skills and Reflective Thinking)
3. Go to www.benjerry.com . Ben & Jerry’s Ice Cream is famous for a well-rounded mission
statement and care and concern for the environment. What is their mission? What
indications are there about the organization’s commitment to the environment? What
values does the company try to express? How might this expression help the organization
market products?
Ben & Jerry’s mission statement can be found under activism (follow the link here:
(25 minutes, Chapter Objective 3, AACSB: Reflective Thinking)
4. Go to www.wholefoods.com . Take some time to become familiar with the website.
Describe this company and the products that they offer. Select specific examples of
products that seem to target the LOHAS values segment. Are the products that might
appeal to values other than those described by LOHAS?
LOHAS is an acronym for “lifestyles of health and sustainability.” Marketers are
(20 minutes, Chapter Objective 3, AACSB: Reflective Thinking)
