Markets present a clash of interest between various players. There is competition for resources, customers and price etc, which breeds ground for activities that may not get ethical sanctions. A certain code of conduct, policies and practices called ethics are required to manage markets and marketing.
Marketing is the heart of all businesses and all other functions depend upon the same for keeping the business moving. It is one business function that interacts the most with markets, in fact markets are meant to sell and they exist only when they sell! In such a scenario there are bound to be multiple players and a clash is inevitable. Such clash leads to malpractices like hoarding, price competitions, brand wars and use of unfair tactics, which is precisely where marketing ethics come into play.
Simply put, ethics means principle or values by which marketing ought to be conducted in the market place. Logically also when there are huge number of transactions involved, a certain code or guiding principles are required to ensure that operations and industry competitiveness is fair and beneficial to the end user. There are different philosophies or schools of thought for ethics in marketing, one is the political philosophy and the other is the transaction focused.
Whereas one school of thought says that all marketing efforts should be focused on maximizing the shareholder value and that this is the only marketing ethics; the other believes that that marketing and market is equally responsible to consumers, other stake holders and the shareholders. The tactic of targeting targeted segments, creating needs that were inexistent till now, transparency about the source of labor and environmental risks, transparency about the use of source and the ingredients, appropriate labeling, mentioning associated health risks, advertising jurisprudence and not making false promises fall within the ambit of marketing ethics.
Lots of marketing and promotion was carried out for goods and services that were not a need till yesterday and only a luxury. Today cell phones have become a need and a status symbol! These are issues that are being discussed in marketing ethics nowadays. Marketing ethics is in its budding stage only considering that it came into being only in late 1990s.
Like other ethical disciplines, marketing ethics is also looked up from various perspectives. There is the perspective of virtue, expediency and other perspectives. But like other ethics there is also the difficulty of deciding the agency responsible for ethical practice. Since there is not one single agency responsible for ethics this gives the independence to an individual or to any marketing agency to act on its own and be ethical!
Marketing ethics unlike other business ethics is not only restricted to the field of marketing alone. It influences many aspects of our life and especially in developing perceptions in the minds of people and creating identities, classes and sections in the society. The visual channels of communication used for marketing sometimes lead to closure of knowledge, opinions, ideas and beliefs. It creates prejudices in the mind of people.