Mkt Exam 2 11.12.12 Ethics

Front 1

Illegal actions are just subset of

Back 1

unethical actions

Leaving car at meter is illegal but not unethical
Punch as unethical but not illegal (also cigarette example)

Front 2

AMA's ethical norms (3)

Back 2

As marketers, we must

1. Do no harm-consciously avoiding harmful actions or omissions by embodying high ethical standards and adhering to all applicable laws/regulations

2. Foster trust in the marketing system-striving for good faith and fair dealing, avoiding deception

3. Embrace ethical values-honesty, responsibility, fairness, respect, transparency, citizenship

Front 3

How does FTC determine if an ad is deceptive (2)

Back 3

1. Would it mislead a reasonable consumer? (typical person viewing ad-FTC doesn't just focus on words..also pics and context

2. Does advertiser have proof to back up both "express" and "implied" claims--seller of product

Front 4

Express claims

Back 4

Tests prove...doctors recommend...studies show (explicit factual claims)

Front 5

Implied claims

Back 5

A claim made indirectly or by inference

Example: we prevent the germs that cause colds (indirectly prevent colds)

Advertisers must have proof to support both express and implied claims (Airbrushing may be implied claim)

Front 6

3 types of ads FTC most likely focus on

Back 6

1. Ads that make claims about health or safety (big focus)-our sunscreen reduce skin cancer

2. Ads that make claims that consumers would have trouble evaluating for themselves (don't have expertise)

3. Ads aimed at vulnerable customers (like kids, elderly, no edu)

Front 7

Puffery

Back 7

Subjective, rather than objective, claims that no "reasonable customer" would take seriously

We have best taking juice

papa johns does puffery

Front 8

3 common penalties for false ads

Back 8

If FCC sees you screw up

1. Cease and desist orders (stop running, fine violation)

2. Civil penalties (thousands to millions)

3. Run corrective ads

Front 9

You can imply, but not

Back 9

explcitly say something false!

Front 10

3 FTC rules on disclosures

Back 10

Have to be very clear

1. Must be clear and conspicuous

2. Small print can;t be used to undo claims made in ad, or clear up misimpressions ad would otherwise leave

3. Fine to use small print, footnotes to clarify or elaborate on statements

Front 11

When introducing new brand, don't have people

Back 11

speak fast in commercial

Front 12

2 Rules on celebrity endorse

Back 12

1. One time fees paid to celebrity endorser need not be disclosed (of celebrity based on sales volume, conpensation must be disclosed)

2. Celebrity has duty to investigate truthfulness of claims--like company, celebrity can be held liable for sale claims..many seem indemnification clauses

Front 13

Liability can extend far beyond manu (3)

Back 13

1. Endorsers (celebrity or experts)

2. Ad agencies (expertise in evaluation ad)

3. But the media outlet that carries the ad is generally not viewed as liable...unless clearly dubious

Front 14

FDC doesn't cover

Back 14

everything

Front 15

Counterfeits (3)

Back 15

1. One of the oldest crimes in history..former punish by death in 13th cent europe

2. Global market for counterfeits exceeds 600 mil

3. Quality of counterfeits has improved over years..some factories have ghost shifts..same designs after hours

Front 16

People behave less well with

Back 16

counterfeit sunglasses on

Front 17

Sometimes, companies can do good and save money at same time (4)

Back 17

1. Experiment conducted at Holiday Inn in Tempe

2. Varied message on towel rack

3. Single occupant rooms only..need to be sure reuser reads message

4. Only look at data first stay

Control condition (help save environment..37% reuse)

Global norm condition (join your fellow guests...44% reuse)

Local norm condition (join your fellow guests from this room...49% reuse)

Front 18

Boomerang effects

Back 18

Descriptive norms provide a standard from which people do not want to deviate..but people go towards mean...but highlighting injunctive norm with smiley or frowney can fix this

Front 19

Can influence cognitive bias with impression...cookies

Back 19

Organic has less calories than non organic? not true