Introduction To Marketing

ASSIGNMENT NO. 2

Societal Marketing

Submitted To

Prof. Omar Shaoor

Submitted By

Abdul Karim

L1F10MSMG0065

University Of Central Punjab Lahore

Societal Marketing

Business executives are often perplexed by the continuous expansion of

society's expectations of corporations. For example, in the corporate world,

numerous laws and extensive government regulation affect virtually every

aspect of business activities. They touch almost every business decision

ranging from the production of goods and services to their packaging,

distribution, marketing, and service. Thus, not only are companies held

responsible for maximizing profits for the owners and shareholders and for

operating within the legal framework, they are also expected to support their

employees' quality of work life, to demonstrate their concern for the

communities within which their businesses operate, to minimize the impact

of various hazards on the global environment, and to engage in purely social

or philanthropic endeavors.

The societal marketing concept is an enlightened marketing concept that

holds that a company should make good marketing decisions by considering

consumers' wants, the company's requirements, and society's long-term

interests. It is closely linked with the principles of corporate social

responsibility and of sustainable development. The concept has an emphasis

on social responsibility and suggests that for a company to only focus on

exchange relationship with customers might not be suitable in order to

sustain long term success. Rather, marketing strategy should deliver value

to customers in a way that maintains or improves both the consumer's and

the society's well-being.

Most companies recognize that socially responsible activities improve their

image among customers, stockholders, the financial community, and other

relevant publics. Ethical and socially responsible practices are simply good

business, resulting not only in favorable image, but ultimately in increased

sales.

Societal marketing should not be confused with social marketing. The

societal marketing concept was a forerunner of sustainable marketing in

integrating issues of social responsibility into commercial marketing

strategies. In contrast to that, social marketing uses commercial marketing

theories, tools and techniques to social issues.

Social marketing applies a “customer orientated” approach and uses the

concepts and tools used by commercial marketers in pursuit of social goals

like Anti-Smoking-Campaigns or fund raising for NGOs.

Corporate Social Responsibility and Societal Marketing

The societal marketing concept introduces corporate social responsibility

(CSR) into marketing practices. Societal marketing incorporates a focus on

the consumer’s and society’s well-being (Kotler, 2003). Research executed in

many countries has consistently shown that consumers express a more

positive attitude toward a company that practices societal marketing, and

additionally prefer to purchase the products of these companies (Business in

the Community, 1997, 1998; Cone Inc., 2000, 2002; Cone/Roper

Communications, 1994, 1999; Cavill + Co, 1997a, 1997b; Jayne, 2001;

Kaplan, 2002; Nowicka, 2002). However, little research has considered how

and why this relationship between societal marketing and consumer

attitudes occurs, or to uncover the conditions favoring or hindering the

development of this relationship.

As a key member of society, a corporation should take into account the

societal needs that are expected to be met by business. These needs

constitute a social demand. Thus, social demand incorporates not only

demand for a firm's products and services, but also extends to the fulfillment

of other societal needs. With this framework in mind, it can be stated that

the scope of a business organization, i.e., what products and services it

provides, is determined both by the organization itself and by society's

expectations. Consequently, a firm's mission and objectives should not only

address traditional organizational concerns such as profitability and markets

served, but should also be concerned with determining and meeting various

societal expectations.

One of the aspects of the societal marketing includes alliances that have

arisen between environmentalist groups and businesses in the last decade.

The new relationships have been described as path breaking and innovative.

Typically, they are distinguishable from the prior charitable and commercial

relationships because they engage the expert knowledge of the

environmental group and involve it, to varying degrees, in joint problem

solving or strategic decision making with the corporate partner. In this

category are green product endorsements, audits by environmental groups

of business programs or practices, and joint projects of the type engaged in

by green alliance between McDonald's and Environmental Defense Fund,

where the corporate partner's business practices are evaluated and

improved according to ecological criteria.

Green alliances also function rhetorically in a more complex way than

traditional business-environmentalist relationships. Green alliances, a

strategy within corporate environmental management, also have symbolic

and political value - for both partners. The corporation borrows not only the

environmental expertise, but also the credibility, of the ecology group, which

by its allegiance implicitly or explicitly endorses company actions. The

partnership also brings corporate actors into the group of those to be

entrusted with the work of saving the earth.

Companies Employing the Societal Marketing Concept

McDonald's:

McDonald's is the leader of the fast-food industry, with worldwide operations

employing approximately 500,000 people in 11,000 restaurants and serving

22 million customers a day. At the time Environmental Defense Fund (EDF)

approached McDonald's, its entanglement in controversy over its packaging

frustrated the company. From EDF's perspective, McDonald's leadership

position, its problematic history of waste management, and the iconic value

of waste management as an environmental issue made the company an

attractive candidate for partnership. EDF saw significant opportunity for both

environmental action and a major, high visibility, opportunity to test its

innovative approach to environmental problem-solving through corporate

partnerships. Plastic had been demonized by several environmentalist

organizations. The use-and-dispose philosophy at the core of McDonald's

business and its distinctive plastic clamshell sandwich boxes, which helped

to make the company one of the largest single users of polystyrene in the

United States, had made McDonald's a continuing target of ecology groups.

Throughout the late 1980s, McDonald's instituted and publicized a number of

environmentally positive steps in its domestic operations. It reduced

consumption, for instance, by using lighter weight paper in straws, paper

bags and other items and recycled paper and cardboard packaging. In 1987,

it switched from polystyrene blown with CFCs, the family of chemicals which

destroy the ozone layer, to plastic foam that used hydrocarbon blowing. In

1989, the company instituted a pilot program in 450 New England stores to

recycle its plastic clamshells. In April, 1990, it committed $100 million, or

one quarter of the company's annual building and remodeling budget, to buy

recycled materials for restaurant construction, remodeling, and operations

under a program called "McRecycle"

In 1989 and 1990, McDonald's bolstered its environmental management

practices with a proactive public relations campaign. McDonald's also offered

in-store flyers to educate customers about the company's environmental

management practices, policies, philosophies, and positions on particular

issues such as rainforest beef and the ozone problem. Brochures on

environmental topics, including packaging, were available from its public

relations department. In addition, McDonald's worked with several different

environmental and nonprofit groups (e.g., the World Wildlife Fund and the

Smithsonian Institution) to coproduce elementary school materials on the

environment. McDonald's positions itself as having concerns ecological and

practical, social as well as economic. Second, McDonald's positions itself as

one of a community of stewards of the earth. McDonald's defends its

environmental record by listing specific actions that it has taken to manage

waste and conserve resources by reducing, reusing and recycling materials.

It cites experts who support its position on plastic packaging and who point

out the small contribution of the entire quick-service restaurant industry to

America's waste.

COCA-COLA:

Coca- cola is a soft drink company started early in the 90’s in USA. After

gaining a good market value in the world the company looked out for

promoting large people towards their products. As a result they formulated

an awareness program in the African countries about the HIV awareness.

In the 2001 the Coco-Cola African foundations was formed to reduce the

impact of HIV – AIDS on coca-cola 60000 employees and 40 independent

bottlers in Africa.

At present, 100 percent of the coca-cola’s independent bottling companies in

54 African countries are enrolled in the foundations programs.

All their employees and the employees’ families are eligible to receive

benefits, including access to antiretroviral drugs, testing, counseling,

prevention, and treatment. The foundations outreach also extends beyond

employees and into community.

It focuses its efforts on three factors which Coca- cola operates:

healthcare, education, and the environment. The many projects are

supported by the foundation cost millions of dollars each year, but coca- cola

offers more than just funding. By using its distribution network, one of the

most extensive in Africa, coca-cola can transport vital materials to the

remote part of the continent.

It reach areas of Africa which the AIDS/HIV workers have not previously

had easy access and thereby ensure that people in those areas can obtain

information about the prevention and treatment of HIV/AIDS. Even Coca-

Cola’s marketing expertise is being used to raise awareness of key issues of

such as HIV prevention. By leveraging its corporate assets, Coca-Cola has

made contribution to all African communities.

NIKE - "Just do it”:

Nike, Inc., a marketer of athletic shoes and sports apparel, has grown into a

large multinational enterprise through a marketing strategy centering on a

favorable brand image.

In 1996, NIKE decided to design a new, state-of-the-art campus for its

European headquarters in the Netherlands. A complex of five new buildings,

the campus was designed to integrate the indoors with the surrounding

environment, tapping into local energy flows to create healthy, beneficial

relationships between nature and human culture.

We had come to see that our customers' health and our own ability to

compete are inseparable from the health of the environment," said Darcy

Winslow, one of the early leaders of the sustainability movement within the

company. Product innovation and performance remained Nike's first priority,

she said, "but our sense of design excellence had expanded to include a

commitment to ecological intelligence, to fully understanding the impacts of

our products on the natural world."

Nike's first steps toward ecologically intelligent product design began

with materials. Together they sought to determine the chemical composition

and environmental effects of the materials and manufacturing processes.

Using natural flows of energy and nutrients as models, these product

materials are designed to flow in closed loop cycles, eliminating the concept

of waste while enhancing and replenishing both nature and commerce.

With its Management of Environmental Safety and Health program, for

example, Nike has merged health and safety metrics with a Nike

management model to create a framework for sustainability suitable for its

Asian contract factories.

Conclusion

We have studies that affinity marketing initiatives, especially societal

marketing initiatives, have the potential to improve consumers’ attitudes

about a brand in a number of different ways. How much a given initiative will

help or hurt a given brand will, of course, depend on the characteristics of its

target markets.

While consumerists and other critics of the selling concept regularly and

loudly chastise business organizations for employing marketing strategies

and campaigns which are ostensibly based upon assumptions of consumer

ignorance and irrationality, these same guardians of consumer interest are

typically synonymous with those pushing organizations most forcefully into

programs of social responsibility and the societal marketing concept.

It must inevitably be those organizations which are encouraged to view their

consumers as ignorant or irrational that can and will most easily extend that

notion to discover opportunities for exploiting that ignorance and

irrationality. It is for this reason that those espousing the societal marketing

concept of business can be seen as the greatest danger to consumer

sovereignty and consumer welfare. Yet it is a corollary rule that in reducing

one individual's power, all others with whom that person deals have their

relative power increased. By forcing consumers into the roles of ignorant,

helpless, and mindless children in need of protection and corporate welfare,

advocates of the societal marketing concept have liberated consumers from

both responsibility and power, and have concomitantly made business more

powerful.

References

Crane, A. & Desmond, J. 2002, ‘Societal marketing and morality’, European Journal of Marketing, vol. 36, no. 5/6, pp. 548-69.

Hoeffler, S. & Keller, K. L. 2002, ‘Building brand equity through corporate societal marketing’, Journal of Public Policy & Marketing, Spring, vol. 21, no. 1,pp. 78-89.

Ajzen, I. & Fishbein, M. 1980, Understanding Attitudes and Predicting Social Behavior, Englewood-Cliffs, NEW JERSEY, Prentice-Hall.

Kotler, P. (1977a), "From Sales Obsession to Marketing Effectiveness," Harvard Business Review (November-December), 67-75