Does marketing do more harm to society than good?

Kotler’s social definition:

Marketing is a societal process by which individuals and groups obtain what they need and want through creating, offering, and exchanging products and services of value freely with others.

The Marketing Mix

Product Life Cycle

Segmentation, Targeting, Positioning

Direct Marketing

CRM

Sponsorship Marketing

Brand Equity Marketing

CSR Marketing

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Some say……….“ Too much resources and time are spent on marketing efforts

such as branding & adverts rather than the actual product. “

“….advertising is…….an investment in cold hard equity. The more you spend, the more your company is worth.” - Naomi Klein, No Logo

The negative impacts of this can be categorised into:

• Impact on Consumers• Impact of Society• Impact on other businesses

The price paid for brands sometimes do not justify the quality and value of the brand.

Brands vs generics: Is it worth the extra dollars, to spend on a branded product when the same (generic) product offers matching qualities?

Pain reliever: To be certified a "generic" by the Food and Drug Administration, a pain reliever has to have the same "active ingredient" as its brand name equivalent. i.e: the "active ingredient" in Advil is ibuprofen. The generic also has to have an efficacy rate similar to that of a name brand, usually within a 20 percent range.

Fashion: When it comes to "trend-of-the-moment" items you'll only wear one season, there is NO point is spending hundreds of dollars.

i.e: French designer label Balmain has fabulous autumn/fall dresses, which can cost you up to thousands of pounds! While similar style from ‘fashion-for-the people-label’ Primark will cost less than a hundred pounds! Savings are HUGE!!

Gasoline: Studies have shown, in essence, that "gas is gas" -- that the gas at the two types of stations is essentially the same.

i.e: The price difference between the gasoline at the name-brand stations, such as Exxon/Mobil, and "off-brand" stations can be about 20 cents a gallon. That amounts to USD$14 a month for the average driver, and that adds up to more than USD170 per year.

Consumers fall as victims of pervasive and ubiquitous marketing. Creating persuasive & manipulative marketing tactics that appeal to all consumers senses such as:

• Meticulously select images and scenes that will associate their products and programs to desired, pleasurable, and optimum outcomes.

• Carefully selected words that provoke your emotions and behavior toward buying their product or staying tuned to their program.

• They diligently select songs to play along side the pictures and words so that your emotions are stirred even further.

TV Program•Preview clips of television programs do not accurately depict what actually happens. •Cut, paste, and match up different dialog and scenes to create a preview clip that is highly provocative and enticing.•It is not a truthful portrayal of what really happened.

The Bold and the Beautiful: Most watched soap opera in the world, originated from America which first premiered in 1987

Car•Toyota & Lexus, Chevrolet & Cadilliac, Honda & Acura, Volkswagen & BMW..•None of these cars gets you to places much differently •Automobile advertisements have brainwashed consumers into believing that luxury vehicles will give us more prestige, confidence, and fulfillment.

•Popular stereotypes: all women are thin, scantily clad sex fiends, all men are rich, muscular, drive exotic cars, and drink only the finest Canadian beer, and that one is not socially acceptable if a specific popular stereotype does not apply directly to them•Readers of magazines, such as Seventeen, Cosmopolitan, Maxim, Esquire, etc. often develop self-esteem problems, because they want to look like the unrealistically portrayed models. •Models in women’s

magazines are usually underweight and are often the cause of teenage girls becoming anorexic or bulimic.

•Magazines contribute to the perception of self-esteem by portraying the perfect models and preying on impressionable youth.

Sex sells! : How marketing influence sex attitude and creates artificiality

The ubiquity and pervasiveness of sexualized marketing messages can lead to loosening of traditional moral

values, and misconceptions of sexual behavior.

http://www.youtube.com/watch?v=fNCMxWOKl34

Video 1: Carl’s Jr. Ultimate Salad Lunch Date with Kim Kardashian

http://www.youtube.com/watch?v=fNCMxWOKl34

Marketing has often been criticized for a hedonistic life style and producing a consumer culture where products and services are the core of social identity at the expense of other “traditional” values.

In other words, matter is the only substance.

Example: The culture in cities like Singapore, Hong Kong and Japan is extremely brand-conscious. Consumers are more concerned with the status symbol (the brands they carry) rather than fashion statements (the things they actually like).

Example:

Having nothing at all but designer bags and Chi Wawa is enough!

Example: Long queues just to purchase a mobile phone! Strong marketing by Apple to influence consumer into buying Apple products.

Too many people spend money they haven't earned, to

buy things they don't want, to impress people they don't like. - Will Rogers

(1879-1935)

We have chosen to “live better today” at the expense of our tomorrows, and our children’s tomorrows, by depleting our reserves, borrowing imprudently, deferring critical investments, and relying excessively on foreign resources.

Example : Buffet promotion. Wastage of food when customers are over ambitious of the amount of food they can consume.

Example: Average US woman owns 17 pairs of shoes. But despite owning so many pairs, only 3 shoe styles are worn regularly, leaving the other 14 languishing at the back of the wardrobe.

Children view a lot of advertisement, this make kids better consumers. This receptiveness translates into – Pester Power. Pester power is the new buzzword in marketing. Marketers realized that the child is the key to loosen his parents’ purse-strings.

Example: Fast Food and sugary cereals being advertised as good and healthy food for kids.

Example: Cigarette and tobacco companies continue to advertise heavily at retail outlets. The industry has to reach young people with the hopes to addict a new generation of smokers.

a. Marketing practices that create barriers to prevent, or discourage, other firms from entering the industry

Brought about by three industry trends:• the first is price wars, in which the biggest mega chains systematically undersell all their competitors;• the second is the practice of blitzing out the competition by setting up chain-store "clusters." • the third trend is the arrival of the palatial flagship superstore, which appears on prime real estate and acts as a three-dimensional ad for the brand.

Example:

The formula that has made Wal-Mart the largest retailer in the world: First, build stores two and three times the size of your closest competitors

Next, pile your shelves with products purchased in such great volume that the suppliers are forced to give you a substantially lower price than would they would otherwise

Then cut your in-store prices so low that no small retailer can begin to compete with your "everyday low prices.”

b. Unfair competitive marketing practices

Kodak•controlled 96% of the film & camera market in the US at one time•following the development of its’ Kodacolor film, Kodak’s became not only the only manufacturer and seller of Kodacolor, it was also the only company that knew how to process the film as well – and parlayed that into its’ business strategy•as part of the purchase cost of Kodacolor, Kodak included a fee that would allow the customer to send in the film for processing and delivery•accused that the “tying” together of the film and the finished product constituted a violation of the Sherman Act, Kodak was forced to license the color finishing process to third parties

Kevin Choo - Shanmuga - Afiah Hafiz - Gurmeet Singh - Vivien Lim

Is marketing in its present form still relevant to today’s society given all the

criticisms levelled against it?

• Is the world better off today than it was a hundred years ago?

• Do the majority of people today live with a higher standard of living?

• Do they enjoy more comforts?• Do people suffer less sickness and disease?

• Do people live longer?• Can you imagine not having running water, electricity, a

car, cell phones, internet access, or toilet paper?

1.Increased employment and personal income2.Freedom of choice in consumption3.Delivery of a standard of living4.Creates aspirations5.Tax payments for public purposes6.Fundraising for events and causes7.Development and Diffusion of Technology and Innovation8.Integral to economic growth & prosperity9.Increased awareness of important socio-political, medical and

environmental issues


• Consumer advocacy groups (Consumers International, ICRT, CAP, etc)

• Ethical Marketing (Fair Trade movement, AMA Code of Ethics, etc)

• Consumer Protection Legislation• Environmentalism (Greenpeace, Earth Charter Initiative,

etc)• Independent movements (Adbusters, WhiteDot, Campaign

for Commercial-Free Childhood, Culture Jamming, etc)


Examples of society reacting to unethical marketing practices

McLibel

McDonald’s sued members of London Greenpeace for distributing a pamphlet that allegedly described the unethical activities that McDonalds engages in to market its products.

The protracted lawsuit was eventually resolved in a judgement in favour of McDonald’s, but it created widespread awareness of the practices of large corporations that were detrimental to society, culminating in a film in 2005 and giving more momentum to various social activism movements.

Reebok EasyTone Shoes

Reebok commercials promised “better legs and a better butt with every step,” when wearing its EasyTone shoes. Workouts in the shoes were also advertised to be up to 28 per cent more effective.

In 2011, the US Federal Trade Comission recently settled a $25 million class action suit against Reebok, whose EasyTone and RunTone shoes were proven to be no better than the average running shoe.


Democratization effect of the internet on marketing

•Small businesses can reach larger audiences at minimal costs

•Products are being embedded with more value to consumers

•Consumers are more empowered with easy access to product information


Future of marketingThe future is Human-Centric Marketing

(Marketing 3.0)

Marketing 1.0Product-Centric

Marketing 1.0Product-Centric

Transaction Based

One-to-many transaction

Sell Product

Industrial Revolution

Marketing 2.0

Customer-Centric

Customer Centric

One-to-one relationship

Satisfy & retain customerInformation technology

Marketing 3.0Human-Centric

Participation / Collaboration & Co-creation

Many-to-many collaboration

Make the world a better placeNew technologyGlobalisationCreative Society

Objective

Key Attribute

Interaction with customer

Enabling Force

Philip Kotler, Hermawan Kartajaya, and Antonio Setiawan, Marketing 3.0, (Wiley, May 2010).


• Consumers are able to independently communicate en mass with each other.

Paradoxes:• Emergence of non

capitalism economic superpowers

• Economic integration doesn’t create equal economies

• Globalisaiton creates a diverse culture

Future of marketingThe main drivers of Marketing 3.0

Technology enable

co-creation



Future of marketingValues-Driven Marketing is the best

model for Marketing 3.0



Future of marketingValue based matrix of Timberland


Although modern marketing has it flaws, it is nonetheless even more relevant in today’s world

where access to information is considered a birthright, and the flow of information has never been

more fluid.

Marketing, now more than ever, is relevant and important in today’s society.

Business

Does marketing do more harm to society than good?