Before the digital age, it wasn’t easy for consumers to work out whether a particular business acted ethically, except by word of mouth. Now, reviews and information about a business’ reliability, values and practices are just a click away.
Business reviews on social media are today’s word of mouth, and they are an integral part of the purchasing process.
According to a 2020 survey by review platform Trustpilot, 89 percent of consumers worldwide read online reviews before buying products. Bizrate Insights found that 57 percent of shoppers use Google to access reviews, while 40 percent look at a business’s own website; 20 percent find information on Yelp, and 20 percent look on Facebook.
“The consumer has a lot more power than they’ve ever had before,” said Karole Campbell, owner of Madwoman Marketing Strategies. “People are going to find out almost instantly through reviews and Facebook posts if you do something that’s unethical.”
That’s why doing the right thing pays off.
“If you’re not acting ethically, you don’t have a sustainable business,” Campbell said. “You can take some money and run, but you can’t build a business that’s going to last.”
Promoting ethical business is the chief goal of the Better Business Bureau.
“Trust is today’s currency,” said Jonathan Liebert, CEO and executive director of the Better Business Bureau of Southern Colorado. “During the pandemic, our website traffic nearly doubled, and we’ve not seen numbers like this in a decade.”
The bureau lists eight standards for trust that embody an ethical business and that are required for BBB certification. They include:
• Building trust — establishing and maintaining a positive track record in the marketplace
• Advertising honestly — adhering to established standards of advertising and selling
• Telling the truth — honestly representing products and services, including clear and adequate disclosures of all material terms
• Being transparent — openly identifying the nature, location and ownership of the business, and clearly disclosing all policies, guarantees and procedures that bear on a customer’s decision to buy
• Honoring promises — abiding by all written agreements and verbal representations
• Being responsive — addressing marketplace disputes quickly, professionally and in good faith
• Safeguarding privacy — protecting customer data against mishandling and fraud, collecting personal information only as needed and respecting the preferences of customers regarding the use of their information
• Embodying integrity — approaching all business dealings, marketplace transactions and commitments with integrity.
Increasingly, an ethical business is viewed as one that “seeks to benefit society, starting with customers, but also including their employees, their neighbors and the environment, said online marketing and business growth consultant Tom McClintock, owner of Relationship Martech.
Not all businesses have the resources to pursue a social enterprise, “but they always have resources to do what’s ethical,” McClintock said.
It’s important for businesses to share stories about the good they do, including both their community interactions and behind-the-scenes actions they’re taking, such as hiring practices that seek to provide equal opportunity employment for women, people of color and other groups, said Amy Sufak, president and founder of Red Energy Public Relations.
“Customers are demanding these things,” Sufak said, “so these stories are being told through the initiatives of marketers.”
In this story, we’re taking a closer look at ethical marketing — what it means and how it benefits businesses. In future issues, the Business Journal explore ethical investing — how people can support businesses that share their values, and social impact enterprise, wherein businesses can both make a difference in their communities and thrive financially.
ETHICS IN ACTION
“We are asked on a daily basis to market a variety of products and services,” Sufak said. “As professionals, it’s always been our responsibility to only promote things that we can stand behind, and that we know are ethical and that we believe in…. It’s always been important to make sure what is the impact of that product to society.”
Part of the marketer’s job is to help people get to know the business.
“And when I say marketer, it could be just the business owner, or the employees,” Sufak said. “Everyone really is in marketing, because they’re sharing the story of their business. It’s important that they put out there what is honest and true.”
Sufak and her company’s employees talk with clients about having a clear vision of the company’s values.
“I think that people should be making a concerted effort to really think about diversity and inclusion,” she said. “These things are not just concepts that we may hear about or read about in the news, and I think that the consumer now demands the social responsibility of those who are putting products and services out there.”
Younger purchasers especially are making these demands known.
“I think it’s really important that their voices are heard and that we’re taking them seriously,” she said. “It is their disposable income that will often help many small businesses to thrive, if they are aligned with the consumers that are demanding these kinds of changes.”
McClintock views ethical marketing as “simply part of the job. … It’s all about messaging — what message are you creating, and what’s the impact of that message? Is the message going to benefit the audience?”
Content marketing is an example of messaging that can have a positive impact, he said.
“Content marketing is often about giving information for free,” he said. “The idea is that if you get my information for free, you’re more likely to come back to me and want to do business, because people do business with whom they know, like and trust.”
A small company that sells healthy food and drinks, for example, could include a calorie counter or nutritional analysis on its website.
“Maybe they’d send out some of their recipes,” McClintock said. “Getting out that information would make them not only a subject matter expert in nutrition but also a resource for people.”
Appealing to people’s emotions, such as fear, has always been a tactic marketers use to develop strategy and messaging. That’s not wrong, McClintock said, as long as it’s a legitimate “pain point.”
“If as a marketer, I have a solution that helps alleviate fear, that’s good,” he said.
Marketers can design and implement marketing strategy and activities that are good for all of a company’s stakeholders, said Dr. Martin Key, associate professor of digital strategy and marketing in the UCCS College of Business.
“Marketers can play a very important role insofar as they can be the voice of the customer within the organization,” Key said. “They have a responsibility to convey what’s best for the customer as well as what’s best for the company. It’s very much a two-way street.”
Ethical marketing “comes down to organizations having a set of values and ethical principles that guide their marketing decision making, … treating internal and external stakeholders with integrity, honesty and transparency,” he said.
There’s much discussion in marketing literature and on social media about the ethics of collecting and using consumer information, such as Facebook and Google mining the data supplied by their users to target prospective buyers for their advertising clients.
“And I also believe that a lot of people reap the benefits of being marketed to in a way that aligns with things they believe in or things that they like,” she said. “Where it becomes unethical is when people don’t know or understand what they’re signing up for. That’s when we’ve crossed the line between helping your search or being searched, which is a very different thing.
“The truth is, you have the opportunity always to not participate,” she said.
“Nobody is forcing you to open an Instagram account or to tweet something out on Twitter.”
Sufak cited her agency’s representation of several retirement communities as examples of the ethical use of data.
“We know from the data that we collect or that we observe, that women often have the responsibility for the health care decisions of their loved ones, particularly their aging parents,” she said. “We market to them because we know they are searching for those resources, so we’re simply giving them those resources, and they can take it or leave it.”
Still, there is legitimate concern about the role of digital advertising, Campbell said.
“There’s still advertising about, you have bad breath, you’ll never get a date, so you’ve got to have good toothpaste,” she said, “or you have to be pretty to be worthy. I think that’s obsolete.”
Also, she said, “there is marketing that is taking advantages, telling a customer something that’s not true — where it’s like, there’s only 50 left. [Is it really] 50,000 or 50 million?”
Although ultimately it is the consumer’s choice to act on the information they see or hear in ads, “the decisions you make as a marketer impact people’s lives; they impact people’s finances, and they impact their well being.”
In his classes on digital marketing and strategy, Key said he stresses the importance of customer privacy and security.
“Because marketers, IT professionals and data analysts are gathering all of this customer information and making sense of it, there should be a real sense of protection around that and making sure it is secure and safeguarded,” he said.
“What I teach my students is to communicate with their customers about the type of information that they gather, how they keep that information safe, and how that information is used,” Key said.
“The social media platforms do very targeted advertising,” he said, “to the point where people think that their phones are listening to them.
“I think that people are waking up to the fact that their information is vulnerable. With that awareness, you really have to step up as a company. It doesn’t surprise me that people demand more from companies now, but I don’t think it’s anywhere close to where it needs to be.”
Key, who serves as director of the School of Business’s executive education program, said every module in the school’s 13-week mini MBA program will integrate ethics starting this fall.
“We want to offer the idea that ethics is really a source of competitive advantage, not just for the company or startup, but for anyone who makes that a cornerstone of how they work,” he said.