Marketing activities, like all other parts of starting up a fast-food restaurant, take money. However, unlike most other investments in a restaurant, restaurant marketing has several directions although the abundance of the choices leads to difficulties in planning a decent restaurant marketing budget with it main directed at ensuring the effectiveness of the enterprise through avoiding wasteful mistakes (Cannon, et al, 2014). Hence, planning for the marketing budget requires precise and wise marketing priorities since it should be 3% to 6% of the sales. This is a general rule that requires which is mostly regarded as guidelines for a good reason for marketing (Cannon, et al, 2014). In spite of this notion, successful and struggling restaurants spending under 3% of their sales are mostly related to under investment while those above 6% are desperate hence put their eggs in one basket. In this regard, the restaurant marketing budget will embrace the moderate value between 3% and 6%.
Secondly, the marketing activity will be undertaken in two phases on a monthly basis thus adhering to the rule of timely marketing. For example, the marketing business will spend less on marketing in offseason and more during the peak seasons (Cannon, et al, 2014). This because one cannot change winter into summer without a proper and a genius marketing idea. As earlier stated, marketing approaches will be made through advertising through various internet platforms such as social media as well as through promotion.
Other than marketing in the social media platform, the marketing department will establish a suitable location to promote the products and services effectively (Cannon, et al, 2014). For example, in learning institutions, social gathering such as weddings as well as other prospective locations with the ability to purchase the products. In this regard, marketing advertising on the website is estimated at $18,000 while the ordinary promotion is valued at $7,500. However, in order to examine the Return On investment (ROI) on each approach, a survey as well as web transactional data and traffic data in the internet assessment on its contribution and also administer task-completion rates in assessing promotion related marketing strategy.
Marketing Budget and Enterprise
Every business enterprise is subjected to promoting its products and services especially to the vulnerable populations who comprise of the economically, mentally, and physically challenged as well as minority, underage and the elderly residents (Biere, 2020). In this regard, the fast food joints will have special places for people with disability from the ordinary citizens to accommodate their conditions. Similarly, the restaurant’s products will strictly adhere to health nutrition value of the foods for the elderly and the minority through including special meals (Cannon, et al, 2014).
Lastly, the restaurants will organize special days to cater for the community development such as offering free meals to the orphanages during celebrations. In observing the Corporate Social Responsibility, the enterprise will employ qualified chefs from the locale will also be adhered to improve life conditions of the local community (Gil, 2019).
Biere, N. (2020). Branding on a Budget: Marketing in the Nonprofit Sector.
Cannon, J. N., Cannon, H. M., Friesen, D. P., & Feinstein, A. H. (2014). Would You Take a Marketing Man to a Quick Service Restaurant? Modeling Corporate Social Responsibility in a Food Service Menu-Management Simulation. Developments in Business Simulation and Experiential Learning, 38.
Gil, E. L. (2019). Introducing information literacy into a marketing budget class assignment: A case study. Journal of Business & Finance Librarianship, 24(1-2), 1-16.
If you enjoyed reading this post on marketing budget and ethical considerations, I would be very grateful if you could help spread this knowledge by emailing this post to a friend, or sharing it on Twitter or Facebook. Thank you.
Consumer behavior is an important management field, the study and application of which can provide a lot of insight and value to the marketers. This research paper is based mostly on the existing theories and models of consumer behavior. The first part looks for external factors influencing consuming behavior at various stages and the second applies theories to a well known business organization, L’Oreal.
says that the consumer decision making process is often the result of a single
problem however, at other times consumption decision is based on a number of
factors. The example provided by Hawkins (2008) to explain the difference
actually helps the reader in better analyzing the types of consumption requirement.
Running low on gasoline while driving leads to a single factor consumption
decision whereas the realization of an aging automobile, growing feeling of
inadequacy or low self esteem lead to a multi factor consumption decision
regarding a commodity or a service.
marketers of an organization, it is important to take into consideration both
the types of consumption such that the overall sales of that organization are
increased. Consumers are the end point of the supply chain processes. They actually
are the magnetic force for all kinds of manufacturing, production and retailing
processes that are taking place in a market or in an industry. The stronger the
magnetic force in fact, the better will be the overall processes of production,
manufacturing and retailing. It is therefore important for the organizations to
capture as much of that attraction of the customers as possible. One simple
reason for that is that customers are the ones that provide revenue to the
business. An interesting quote by Jeff Bezoz, the CEO of Amazon.com says that
it is actually the customers of the organization that give the business the
money to operate and not the competitors of the organization and thus, all the
strategies that the organization makes to improve the business performance (or
market capitalization) should be oriented towards the customers (Stockport,
then forms the core of the field of consumer behavior. Consumer behavior,
initially stemming out of the study of micro economics has actually gotten
extensive and intensive enough to be termed as a completely independent study
of management sciences and one that can have serious policy implications for a
behavior holds that the purchasing decision of the consumer can actually be
analyzed through various models and theories and using those findings, a
business can orient its market plan to gain competitive advantage in the
market. A number of external and internal factors become a part of
understanding how and why consumers making purchasing decision, using decisions
and disposing off decisions and how preferences and tastes as well as norms,
cultures, peer pressures and traditions become a part of this decision making
process (Lamb, Hair, McDaniel, 2011).
Since it has
now been established that a number of internal and external factors play a role
in influencing the consumers in their consuming decision, the breakdown of each
factor is possible. As far as a business organization and more precisely the
strategic managers or the marketers of the organization are concerned, external
factors are the ones which they have the power over and thus they can influence
the attraction felt by consumers for the product being marketed. However,
before the marketing managers can actually pin point the external factors and
manipulate them, each stage of the decision making process of the consumers
needs to be analyzed.
Analysis of how external variables are used by marketers to influence consumer decision making at the various stages of the consumer decision making model. Illustrations through examples
p. 561) identifies the nominal decision making process and defines it in the
“Nominal decision making, sometimes referred to
as habitual decision making, in effect involves no decision per se….A
completely nominal decision does not even include consideration of the “do not
purchase” alternative. For example you might notice that you are nearly out of
Aim toothpaste and resolve to purchase some the next time you are at the store.
You don’t even consider not replacing the toothpaste or purchasing another
to Hawkins (2008) then a nominal decision making process can be broken down
further into brand loyal decisions and repeat decisions.
For the marketers, development of brand loyalty is another arena that is receiving significant attention mostly because of its importance that has been highlighted through the theories of consumer behavior. The more the consumer feels loyal to the brands, the lesser he or she will actually consider buying another brand and thus the number of secure sales for the organization will increase and in the longer run, the provision of stability of revenue for the organization will also be enhanced.
The example for the nominal decision making process has already been highlighted by reviewing Hawkins (2008) however to provide another example is the purchase of soaps, bottled milk, tea brand, coffee brand or sanitary pads. Mostly, for all of these products, the consumer mechanically throw these products into the shopping cart without even considering that just right to the brand that they picked lies another, probably better brand. Development of this behaviour in the consumers requires effort and strategy from the marketing manager of the business organization.
Next is the
five step decision making process as studied by Lamb, Hair and McDaniel (2011).
In this model, the first step is the recognition of need of a product or
service by the consumers. The second is the information search, third the
evaluation of alternatives and fourth the purchase of the commodity or service.
Finally, the fifth step is the post purchase behaviour. In regards to the model
however, the following has been said (Lamb, Hair and McDaniel, 2011, p. 189),
“The five steps represent a general process that
can be used as a guide for studying how consumers make decision. It is
important to note though that consumers’ decisions do not always proceed in order
through all of these steps. In fact, the consumer may end that process at any
time or may not even make a purchase.”
this model does provide important steps that can be used by the marketers to
create external influence on the consuming behaviours of the customers. Baker
(2003) says that these five stages together are affected by a number of
external and internal factors. These factors include the cultural, social,
individual and psychological factors and are actually applicable to all the
stages of the consumer decision making process. Therefore, if the customers are
to use factors to influence the consumer decision making process, these factors
are to be manipulated. For the purpose of this section of the research report,
only external factors will be analyzed for each stage of consumption of the
goods and services.
step is the recognition of needs. This is actually the first and the most
important step that the marketers can use to attract the customers and thus
gain competitive advantage and even first movers advantage in the market. This
is possible by making the customers realize the need for the product that the
firm is offering. Hawkins (2008, p. 565) says that,
“Marketers often attempt to cause consumers to
recognize a potential problem for which the marketer has a solution…this
sometimes involves making consumers aware of problems well before they arise.”
important word here is “potential”. The usual way through which the problem
solving approach goes is to at first recognize the problem and then solve it. Providing
external stimulus on the need recognition stage of the decision making process,
marketers are actually making the customers create a problem in their head that
they did not realize existed before. Obviously this can be both real and
imaginary but there is no necessity that the consumer knew of the solution to
the problem before. For example, the invention of diapers stimulated the need
recognition stage of the decision making process. Before that for centuries,
mothers and maids were using cloth and plastic panties for their babies and
everything seemed to go fine. With the advent of diapers however, it became
almost a necessity. Something without which bearing a child seemed like a
the marketers can influence the information search stage of the consumer
decision making process by providing to the consumers the necessary information
through various media. Nowadays, television advertisement, billboards and
internet are the favorite sources of providing the consumers with the
information about the product and how that product is the one that the
consumers require in solving the problem. For example when proctor and gamble
came up with the diapers, pampers, they needed to provide the useful
information to the consumers about the product. So that the customers who have
already realized this problem and were looking for a solution find it in the
shape of pampers. This then can require free samples and other promotion
techniques as well. As of today however, the techniques that remain dominant
have been mentioned.
marketers can influence the third step that is of alternative evaluation by
allowing the customer, through efficient marketing strategies to realize that
the product the firm is offering is the best one for the consumer. The external factor used here can be the help
of celebrities to promote a product. Knowing that a specific product works
better than anything else for something well known and looked up to can
actually lead the consumers to be inclined more towards the purchase of that
fourth stage of the consumer decision making model, prices are the factors that
need to be considered and used by the marketers. The consumers should know that
the price they are paying for the product is actually worth it. Here, the
factor and consciousness of social class can play an important role. The effect
of social class on consumer behavior, apart from the direct relationship of
income levels and value of consumption, there is also a direct relationship
till the upper class between the realization of social class and the desire to
mobilize in the social class hierarchy and the value of consumption (Loudon, 2007).
It has been noted that the upper, upper middle and the middle class seriously
dreams of being recognized as the elite (how o not really care about the prices
but about the quality) make more expensive purchases of the products or
services to reinforce their social class image in the society.
Select a company or not-for-profit organisation that you are familiar with and critically evaluate how a specific consumer behavioral theory or model can aid in understanding consumers’ actions. Demonstrate how this then guides the practical implementation of marketing strategy in your chosen organisation.
The business entity selected for the purpose this section of the report is L’Oreal Paris. This is the largest beauty and cosmetics brand in the world. In 2009 L’Oreal completed its hundred years and recognizes its moves in the business world as that of being adventurous. L’Oreal (2011) notes that above and beyond that financial success that the organization has achieved, the journey of L’Oreal has been marked by a quest for innovation, a quest for excellence, a question for the purpose of actually existing in the market and finally a quest for diversity in regards to the range of cultures, preferences and tastes of women around the globe.
This organization has actually celebrated beauty around the globe. L’Oreal has a huge international presence and operates in five continents of the worlds excluding Antarctica and Australia from the list. By the global 100, this beauty brand was actually ranked amongst the world’s 100 most sustainable business organizations. Moreover, this organization in 2011 has been presented with the best financial performance by the Boursoscan (L’Oreal, 2011).
overview of the organization notes that for a century the organization has been
pushing back the boundaries of science to invest and meet the aspirations of
millions of women and men (L’Oreal, 2011). L’Oreal seeks to provide the best
cosmetics to the world in terms of quality, safety and efficacy. In 2010, the
business had consolidated sales figure of 195 billion Euros. Currently, the
organization is managing 23 global brands in 130 countries of the world and
registered 612 patents in the year 2010 (L’Oreal, 2011).
to the core behavioral theories, Schiffman (2008) notes that there are a number
of routes through which the conditioning of consumers to buy a particular
product can be done. The first route is the classical conditioning in which the
consumer links a certain response to a product. For example, in regards to
L’Oreal, classical condition will be that using the Voluminous Mascara
introduced by the organization, the eyelashes will actually look darker and
prettier and the result will be similar to what Ashwariya Rai puts on her eyes.
The conditioning stimulus here will be the darker, more volume eyelashes like
the ones that Ashwariya Rai appears with. Through the advertisement then the
unconditioned response of the consumer who needs to buy mascara turns into a
Schiffman (2008) studies the cognitive associative learning behavior. According
to this view, the relationship or (congruity) between the conditioned stimulus
and the unconditioned stimulus influences the expectations which in turn
influences the behavior of the being. This theory believes that the actions
that occur after certain stimuli have been provided are in fact learned and
occur because of the increase in knowledge. For example in the example above,
the purchase of mascara would occur because knowledge about the qualities of
the product has been gained. Unlike the cognitive associative behavior however,
the classical conditioning believes that the reaction that occurs is actually
these theories, one consumer behavior theory that actually stems out economics
more than psychology is the theory of consumer behavior. Irwin (2005) says that
the consumers according to the model provided in this theory consumes at a
point where there occurs an intersection between the consumer indifference
curve (the choice curve of the customer where combinations of consuming two
alternative goods achieve the same level of utility or satisfaction to the
customer) and the budget constraint of the individual (as understood mostly by
the current income levels of the person or the saved up income from a previous
assumes that the consumers are rational individuals who are responsive to a
price change of products and who also have complete information about the
product and the alternatives. Also it is assumed that the individual under
question is subject to a budget constraint and that he or she has to manage
more than one thing in a given period of time speaking financially.
(2011) however studies the theory of consumer behavior which says that the
problem solving approaches of the consumers are actually internal (made up of
the memory and thinking process of the individuals) and external (made up of
the word of mouth, the media, the store visits and the trials amongst others).
In this theory then, the evaluating behavior of the individuals are made up
either compensatory, non compensatory, hybrid or abandoned strategy. The first
one is the decision based on overall value of alternatives. The non
compensatory evaluation requires that the consuming decision meets at least one
important criterion and the hybrid is a combination of compensatory and non
compensatory evaluation types. Finally, the abandoned strategy is when the
consumer finds the initial criteria unrealistic and proceeds to a less
desirable solution to the problem. Next, Perner (2011) notes that the consuming
behavior of an individual is seriously affected by the attitudes of that
individual; and that in turn attitudes are affected by the intentions, the
beliefs and the feelings about a particular brand.
As far as L’Oreal is concerned, consumer
behavior can be understood critically through these four theories and the
findings can be further used to design a strategy to expand the consumer market
and the competitive advantage of the market.
with the attitudes of the consumers, L’Oreal can be added by understanding what
beliefs individuals have about the products and services that the brand itself
and that the competitors of the brand provide. This can be measured and
analyzed through the attitude measure developed by Perner (2011). Next, the
feelings of the consumers can be understood through this attitude model. For
example, a fan of Ashwariya Rai, or Penelope Cruz (the brand ambassadors of
L’Oreal) will feel a push for consuming the product after aggressively
understanding how they feel for the product. Also, being there for a century,
this brand is also a name through the generations. Understanding those feelings
of the consumers will help steer the marketing plan of the organization towards
a greater organizational performance overall.
Next, the theory of consumer behavior includes the importance of prices of the product. This is actually one of the core consumer behavior theories and is the most detail about the behaviors of the individuals. In this regard the organization can use the theory to understand what effect a price change of the products and services has on the sales of the organization and the demand of the consumers. Make up, after a certain limit is usually a luxury for individuals and L’Oreal is an expensive brand.
To keep up its market share and to not lose to organizations which are charging a lower price for similar products through the substitution and the income effect it is important for the management of the organization to carefully consider the underpinnings of the theory of consumer behavior. For this purpose, if the price of the good is actually not that far away from the actual investment put into the product in terms of research and development and manufacturing, the organization can actually use the coin of high quality. The perception of consumer about the quality of the product is a vital asset when an organization is designing its price and marketing policies. The better the consumer perceive the quality of a product to be, the more he or she will be willing to spare for that product because they will know that the money is being well spent and that there will be no hazardous consequences of using a particular product.
(1970) studies that the consumers are continuously busy in the choice making
between different products however, the consequences of these choices are dimly
known by them. One of the reasons is that they lack full knowledge about the
price and quality of the product. The marketers of a business organization then
can utilize the consuming behavior and the attitudes of the consumers for the
purpose of attracting the maximum share of revenue for the organization.
research paper studied how the marketers can actually use external factors
including the social class, peer pressure, celebrity following and fashion
trends to influence the consuming behavior of the consumers.
part of the research report analyzed the various theories of consumer behavior.
Those theories then were in critically used to apply for the case of L’Oreal
Paris, one of the largest multinationals in the world. Dholakia et al (2010)
says that in the case of multimedia and multi channel organization like
L’Oreal, the analysis of consumer behavior is different than the usual
analysis. Finally, for the applied consumer behavior theories, a number of
marketing strategies were recommended for L’Oreal.
Ethical Consideration within the Retail Sector – Marketing Ethics
Many companies and businessmen often face obstacles as to what practices can ethically be done in order to make money or achieve objectives (Marketing Ethics). Fraud and deception taken up by some companies is not only wrong in the moral sense but restricts the prosperity of the economy as a whole. These practices although may not be illegal in a given geographical boundary yet it cannot be undertaken with a clear conscience.
From a customer’s view point the retailing is the first tie in the distribution chain. Hence it is essential for retailers to be ethical in business practices as they affect the lives of many people. Ethical decisions have a strong significance when it comes to ensuring order and justice in a society. However, difficulty persists as to what falls under the folds of order and justice. In the retail industry, the one department often criticized for unethical actions in business is the marketing department. This negativity can be attributed to the fact that marketing tends to represent the most noticeable department to the public at large. For instance, fabricated pricing, misleading advertisements and deceiving sales pitches from sales personnel often result in hurt or angry customers as well as the media.
Moral constraints persist in the dynamics of marketing functions. For instance, contemporary marketing experts often debate that deceitful marketing is bound to be unsuccessful as the market will shove those who disrupt the common morality. Ethics depicts a form of social control, which is especially critical to the individual customers, the salespeople and the organisation itself. Marketing ethics gives birth to a more socially responsible and culturally penetrating business community. The adherence to marketing ethics has the prospective of being favorable to the society as a whole in the short as well as the long run term; therefore it should be a substantial part of any business model.
There is a pressing concern towards ethical issues, such as poor working conditions, child labor, associations with third world countries, green issues, grey imports and environmental concerns which have led to a change in attitude of the western world to consider a more socially responsible approach. The societal marketing concept stresses the need for organizations to achieve a balance between satisfying customers, achieving profits and maintain the well-being of the society; when making marketing decisions. An organization can play a role in creating a positive impact on the society if it produces useful products in an environmental friendly manner.
Over the years, organizations have evolved and realized their social responsibilities. Organizational social commitment consists of four kinds of responsibilities: legal, economic, philanthropic and ethical. These four classifications have been in existence for decades; however, in recent years social and ethical dimensions have attained increasing importance. Firms come into being to provide goods and services with an aim to maximize profits. In their efforts to attain maximum profits they often forget their responsibilities towards the society. Consumers these days place pressing importance on the need to protect the environment and hence this has put pressure on companies to realize their responsibilities and act in the favor of the society as well satisfying the customers and looking after the well-being of the society in which they operate.
Every business has a two-way relationship with the society. While the business contributes to the society in the form of products and services, the society provides an environment for the businesses to flourish and grown in. Since, the survival of a business depends upon the society, businesses need to perform in a manner that does not harm the environment but is useful to it. For example, companies need to be conscious of the environment they operate in and thoughtful about issues such as ozone layer depletion and global warming. Until recently, cfc (chlorofloro-carbon) which leads to the damaging of the ozone layer was used in the manufacturing of refrigerator compressors in most countries. However, today many companies have adopted various alternatives to cfc and banned its use from production processes. Companies should also take notice of fair practices when it comes to employment such as providing equal employment opportunities to everyone and a safe and fit work environment along with fair compensation packages.
Sourcing of products
Companies operating with global supply chains came under immense pressure by the consumer groups, trade union and the government in the 1990’s to ensure healthy working conditions for those producing their goods in the less developed countries. Various media campaigns have been carried out which shed light on the poor working environment in factories in the less developing countries emphasizing the need for marketing ethics and trading.
This has resulted in the growing importance of marketing ethics in the corporate responsibility agenda of major corporations. Many companies today have established social and environmental criteria for the selection of their business ventures; which includes securing appropriate standards for the labor conditions and work environment in their supply chain. Also, corporate codes of practice are being implemented so as to their ventures according to a range of social and environmental criteria, including an organisation’s efforts to secure adequate labor conditions in their supply chain, and retailers are increasingly implementing corporate codes of practice so as to certify that the working conditions of the labor involved in the production of their goods meet or exceed international labor standards.
For example, Primark’s rating fell in the consumer polls drastically in 2008 after it was discovered that a few of Primark’ suppliers were using child labor. On the other hand, Marks & Spencer had a high rating in consumer polls due to their –‘plan A’ initiative, which comprised of performing life-cycle assessment on their clothing and included carrying out life-cycle assessments on their clothing and developing a clothes recycling arrangement with Oxfam. Primark changing its suppliers and creating a website for the promotion of marketing ethics and its ethical trading records as a comeback for the child labor allegations highlights the significance of showing customers that you are sourcing responsibly.
Every day, a variety of new goods are produced and sold in different geographical boundaries and on virtual markets i.e. online. Increased trading and more refined designs can make it challenging to determine the products consumer purchases are safe for them or not. Product safety is an ethical obligation for every company in the retail business as they have a responsibility to provide consumers with products of value that they pay for and that are safe for use.
An example can be taken of the Yamaha group; it ensures that products and services are not harmful in any way to the consumer’s well-being. If an issue of the sort arises it is immediately dealt with and steps are taken to compensate and prevent the recurrence. In the contemporary retail industry online trading has reached its apex. However, new online products could often be unsafe and cause serious injuries or death if they fail to meet safety standards. Consumers cannot assess the products safety, toughness and inspect labels as the goods are not physically available when purchasing online. Second-hand products available online could also be unsafe as they may fail to meet the desired standards, have damaged or missing parts vital for safe operation, may not be sold with a manual for safe use and assembly instructions or may have been modified by the prior owner causing it to be unsafe.
Products that are sold through non-authorized channels are known as “grey or parallel imports’. These grey imports may appear to be cheap on surface, yet they may be far from cheap when it comes to compliance issues being addressed. They raise financial as well as safety concerns for the purchasers. As these products are not imported with the consent of the manufacturer they do not fall under the manufacturer’s warranty.
Also since these non-authorized products may not pass through regular safety checks that authorized products do they could have potential harmful impact on oneself and one’s family. Moreover, no after sales support is provided as dealer and brokers are not allowed to provide service and spare parts to grey imports which mean maintenance cannot be done by specialized professionals. Grey or parallel imports often have little or no value when reselling as compared to authorized products.
Corporate Social Responsibility (CSR)
The concept of corporate social responsibility is very often linked with the concept of business ethics. Therefore, the main aim of many retailers’ ethics is focused upon the role ethical responsibility plays in order to contribute to the sustainable economic development; healthy work environment for employees, safe society for individuals, the local community and society at large to improve their quality of life. Marketing and marketers play an imperative part in the growth of corporate strategy and respond to the corporate social responsibility agenda.
Business organizations make use of scarce resources in order to produce goods and services to satisfy the customers. To carry out these activities companies need to be cost effective, innovative productive in operations. In order to become successful companies should portray sensitivity to the expectations of the customers when it comes to social issues and environmental well-being (Kotler, 2003). In order to be operating in a socially responsible manner organizations should be concerned for the people and the environment in which the business activity takes place. It is expected that firms that are socially responsible will outperform those less responsible financially in the long run. This can be as a result of customer loyalty and trust, better employee morale or public policies in favor of ethical conduct and overall marketing ethics.
According to an article by Lichtenstein and et al., theory and recent evidence indicated by researchers suggests that a corporation that is socially responsible can have a relatively positive effect on customer attitudes towards the particular corporation (Lichtenstein and et al, 2004). International companies take initiative by donating millions of dollars to non-profit organizations in the form of philanthropy, cause related marketing, employee voluntarism and various novel marketing programs. An example can be of Avon, cosmetic company which raised $200 million for education regarding breast cancer and early diagnosis services through breast cancer awareness crusade.
Consumers are in need of ways to attain information about the products and services they purchase without having the expertise to judge. The fact that consumers are not well-informed anymore and neither are they self-sufficient; both have a significant impact on the the importance of business ethics when dealing with consumers. Firstly, there was a time when customers could analyze and judge on their own whether the quality of a product or service was up to mark. However, now products and services are created by experts with specialized skills. This results in difficulty to judge the quality by a layman, hence companies need to be honest with the consumers and tell them if the product is of acceptable quality standards and performs the functions they need it for. Secondly, people were self-sufficient previously and could produce what they needed to in order to survive on their own. This situation has changed as people have become progressively dependent on goods that have been created by experts, machinery and high quality resources. As a result the customer has little choice but to accept the product as an honest one and trust the organization’s intentions. Hence, this makes it essential for the companies to look out for what falls under the best interest of their customers.
Other Socially Responsible Clothing Retailers
Marks and Spencer is a British retailer which specializes in clothing items and luxury food products. In 2007, this retailing giant announced a five-year plan which made serious vows and commitments to becoming “a carbon neutral, zero-waste-to-landfill, ethical-trading, sustainable-sourcing, health-promoting business.” ASOS is the second largest online retailer in the world, and its brand under the name of green room acts as a podium devoted to collections with an ethical or eco-conscious story to tell. Offering a range of organic recycled and fair trade clothing, accessories, footwear and beauty, ASOS green room makes it easy to shop more responsibly without the sharp price tag. As of 2012, H&M has raised over $4.5 million USD, through a 5 year partner program with UN charity organization UNICEF. Starting in February 2013, H&M will offer patrons a voucher in exchange for used garments. Donated garments will be processed by I:CO, a retailer that recycles used clothing with the goal of creating a zero-waste economy. The initiative is similar to a clothes-collection voucher program launched in April 2012 by Marks & Spencer in partnership with Oxfam.
Marketing Ethics Conclusion
Companies have a moral obligation towards their consumers or potential customers. They must not be deceitful and sell products that are safe for the users. However, it is not entirely clear as to what is morally preferable and where does the advertising cross the overly deceptive boundary and the extent of harm that manipulative advertising can do to people. Hence, it is better to be on the safe side and take extra precautions where the well-being of human life is concerned. The responsibilities of a business are further illustrated in the steps that should be taken by manufacturers in order to ensure that goods of acceptable safety standards are provided to customers. Firstly business should give priority to safety. If costs are being raised in order to meet safety requirements that does not mean they should dismiss it. Products that may lead to serious injuries are often are often the ones that need the highest safety standards. Secondly, businesses should take responsibility of any accidents caused by the product rather than blame it on product misuse. Consumers should be made aware about the proper usage of products that have a tendency to be harmful. Some consumers can still be harmed if they use products appropriately. Also, if products are continuously being misused there should be ways to make the misusing of it less harmful to the user. Thirdly, business must monitor and check the manufacturing process on its own. Often products produced are defected as a result of mismanagement in the manufacturing process. Companies must keep a check on its activities and have a quality control team to ensure that safe and non-defected products pass through to the consumers. Sometimes external quality assessment teams or companies can be hired for an unbiased testing process.
Fourthly, when a product is prepared to be marketed, companies should have a product safety staff in-line to assess the market strategy and advertising for potential safety problem. How a product is being used in an advertisement can have a significant impact in encouraging people to use the product that way. Hence, advertisers should refrain from portraying the usage of product in a harmful manner such as showing people driving cars while texting at the same time.
Fifthly, when a product lands in the marketplace, firms should make sure that written information about the products performance is readily available to the consumers. In order to ensure the product is used in the proper manner and not misused information should be explained in detail about its proper use and made public. Warning labels are found on many products as a result of this. Lastly, companies should investigate and respond to consumer complaints. Consumers being the users can provide a good source of product safety testing and complaints can help the company determine where it lacks and what safety standards the product may lack.
In conclusion, it can be determined that the contemporary retail industry has evolved over the past decade. Previously little importance was given to matters of environmental well-being; the main objective being to maximize profits no matter what the impact it had on one’s surroundings. However, the situation is more subtle now with the consumer becoming more conscious of the environment and sensitive towards its sustainability. Retail businesses have realized the need to be socially responsible in order to gain the consumers trust, loyalty and to satisfy the market. It may incur a cost yet the outcome is far reaching for the overall growth and sustainability of not only the business but the society as a whole.
Gundlach, G.T. and Murphy, P.E. (1993), “Ethical and legal foundations of relational marketing ethics exchanges”, Journal of Marketing, Vol. 57 No. 4, pp. 35-46.
Kotler, P. 2003. A Framework for Marketing Ethics Management. (11th Ed). Pearson Custom Publishing.
Lichtenstein, Donald R., Minette E. Drumwright, and Bridgette M. Braig. 2004. “The Effect of Corporate Social Responsibility on Customer Donations to Corporate-Supported Nonprofits.”Journal of Marketing 68 (October): 16-33.
Murphy, P.E., Laczniak, G.R., Bowie, N.E. and Klein, T.A. (2005), Marketing Ethics, Pearson Prentice Hall, Upper Saddle River, NJ.
Nantel, J. and Weeks, W.A. (1996), “Marketing Ethics is there more to it than the utilitarian approach?” European Journal of Marketing, Vol. 30 No. 5, pp. 9-19.
Urban, G.L. (2005a), “Customer advocacy: a new era in marketing?”, Journal of Public Policy and Marketing, Vol. 24, Spring, pp. 155-9.
Social Media Influence In Consumer Decision Making
The impact reference groups or social connections have in an online marketing environment, on the product purchase decisions of consumers is analyzed in this article. The influence of social media in the decision making process of consumers is investigated, and the influence of the strength of social ties on the final decision are discussed. The article discusses theories and concepts related to social relations, social media, and consumer purchase decision making process. To understand the impact social media has on consumer purchase decision, interview is conducted with micro and macro business owners using Facebook business pages, and having over 50 fans for their fan page. To analyze the data statistical analysis, and descriptive analysis methods are used. The research concludes that a strong tie in social relations serves to influence the purchase decision making process of consumers positively. To create a successful business by adopting an online marketing strategy, building strong social relations is important.
Social scientists have for a long duration highlighted the importance of group membership when it comes to determining individual or group behavior. The fact that individuals act according to a reference frame produced by groups to which they have widely been accepted has been perceived as a sound premise for some time. Marketers have widely accepted the construct of a reference group as critical in at least some forms of consumer decision-making. With the growth of the internet, and online marketing, social media is becoming an indispensable part in everyday lives of people. People are social beings, and at present, consumers are participating in activities like sharing experiences, knowledge, and opinions online. They also take part in online discussions to share their experiences with a product or a service.
The speed with which information transfers has increased with the electronic word of mouth growing more rapidly. Positive recommendations and discussions online have the potential to bring in increased business volume for firms in a short time. There is also the probability of a negative complaint online that can cause mistrust in a service or a product. A new form of social communication has been made possible by online media. Groups or individuals who might never meet in person are able to influence consumer behavior and their purchase decisions. The increasing use of social media is evident from the growth in online population using social network sites. Facebook the leading social media website has observed 23% growth in its user population during 2013, with 1.1 billion users making use of the site each month.
This study investigates the influence of reference groups online brand and product purchase decisions by looking at the interrelations between forms of product use conspicuousness and forms of influence from reference groups in social media. Consumers have a wide access to different types of social media, tools, and platforms. Social media significantly impacts the process of information sharing amongst individuals in the online shopping environment. Through this research, the role played by social media reference groups in forming strong or weak relationships with consumers that can influence the consumer decision making process are investigated.
The study proposes to investigate the relationship between the social media influence of online users, the behavior intentions of consumers, and the role of social media influence in consumer decision making process. The strategy of information search online is adopted by consumers to reduce the risks involved in a purchase decision. Increasing technological advancements lead to ease of information access. Consumers can easily obtain information about services or products through social media before making a purchase. This research is focused on making both practical and academic contributions. Academically, it serves to bridge the gap between consumer decision making and the influence of social media reference groups in forming weak or strong relationship with consumers. Practically, social media marketers benefit from the research results. They can gain a deeper understanding of an online shopping consumer’s decision making process.
Research questions to be explored to investigate the social media phenomenon in online shopping are;
What are the characteristics of social and online influence groups and references?
Personal and demographic factors like gender, age, education, and profession have an influence on information shared through social media. Their experience and prior knowledge influences their level of social influence.
What are the ways through which information and ideas travel through such a reference group or an online community?
The credibility of the source depends on the reference group and the way in which information is conveyed. An understanding of how information or ideas travel through the reference community helps in identifying factors that have a high level of influence on consumer decision making.
What are some forms of ties or connections do consumers have to other consumers in the communities?
Consumers form ties in the online community, resulting in the establishment of a reference group or community. By investigating in what ways and how such communities are formed, social media marketers can leverage their online advertising campaigns.
How is consumer decision making influenced by social media reference groups and communities.
Social media reference groups, and communities alike, are proposed hypothesized to play a major role in the purchase decision of consumers.
Research Aims and Objectives
The research aims to investigate the ways in which social media influences consumer decision making during an online purchase. The various ways in which a social media group or community is used as a reference, the ways through which such groups or communities are accessed, and ways in which information is accessed from these groups by consumers are investigated. Main objectives of research are;
To identify the ways in which social media has established a source of power and leveled the playing field for consumers?
To investigate in what ways leaders of these reference groups or opinion leaders develop in online communities or any other reference group.
To analyze what some of the roles of social capital play when it comes to value of the social communities created on social media?
To offer recommendations to social media marketers on how reference groups and communities can be leveraged to their firm’s advantage.
Rationale for Research
The results obtained from this research could offer considerable evidence on the influence social media has on online marketing. The overall process of consumer decision making while making an online purchase decision, combined with the influence of social media helps managers reduce risks involved in social media marketing, at the same time offering recommendations on the ways in which they can increase their online credibility. Research on social media marketing is relatively new in marketing research. Negligible research exists on interrelating social media marketing and its influence in the consumer decision making process. This research focuses mainly on online shopping, social media, and reference group influence on consumer decision making. So, the theoretical contribution of this research helps fill in the gap in previous literature.
Business pages created on Facebook are the central tool and the key research methodology is action research. Action research involves making systematic observations, and collection of data, that can be used to solve problems, and improve professional business practices. Micro and small businesses are focused. Data is gathered through interview and by using questionnaire. Facebook pages created by small entrepreneurs are used to create a fan base for their small enterprises. As the page continuous to grow and increase in size when it comes to the fan base of about 50 to 60 users data is to be conducted, mainly by carrying out semi- structured interviews.
The research design is action, qualitative research oriented with the conviction that reality is virtual created by factors of socio- economy. Primary data is gathered through semi- structured and open interviews. Data regarding the experiences of the entrepreneur while using and adopting social media like Facebook is focused upon. Secondary data is generated by the recording transcripts from the weekly training and interaction with the participants to understand their requirements and experiences. Tertiary collection of data is carried out through virtual ethnography by carrying out internet-based interviews through Google talk, chat, Skype and blogs.
Structure of Article
To ensure research meets its aims and objectives, clear research questions and research focus are developed first. Analysis of theories and concepts is done in the literature review part. Here theories and concepts relevant to social media as a marketing tool, and consumer decision making process are explored. Research methodology is developed based on literature review, and research aims. This gives a detailed outline of the research methodology to be employed for data collection. The research approach, philosophy, choices, ethical issues and methodologies are explained. Analyzed data gathered from semi – structured interview, and research findings are presented in based on which, conclusion discusses the research concisely, using which suitable recommendations are offered.
The way in which consumers make purchase decision has changed with the advent of social media. Rather than waiting for messages or advertisements giving information about a service or a product from companies, consumers are now seeking information on social media directly. Online community has the greatest amount of influence, especially on online shoppers. Research proposes to investigate the characteristics of online communities and reference groups involved in social media. The ways in which such groups influence the consumer decision making process is explored. For data collection, semi – structured interviews are conducted with online micro and small business entrepreneurs making use of social media tools like Facebook and blogs.
Discuss the purpose of corporate communication strategies
Corporate communication is the overall effort of an organization to communicate effectively and profitably. For the achievement of set goals of an organization, it depends largely on character and organization’s relationship with its stakeholders such as community, employees, clients and suppliers. Thus, it is a strategic tool for an organisation to have competitive advantage over its competitors. It is used to motivate, inform employees, lead and persuade the clients. Corporate communication strategies should be aligned according to different organisation members who may not necessarily be having the same interests. Below are the purposes of corporate communication strategies. Public information: here communication is described as dissemination of information through the media such as bronchus and newsletters. Two ways symmetric: here is a dialog rather than a monolog, communication efforts are seen in terms of its research based and the use of communication in enhancing understanding with stakeholders. Press a gentry: it tries to gain coverage from mass media. Here information is given and no more information is collected from the stakeholders.
Assess how corporate communications link to corporate objectives
Significant relationship between corporate objectives and corporate communication is evident. The top management should ensure that the corporate objectives are clearly communicated to the lower management through the middle. Lack of effective communication may lead to poor or no strategy implementation. Percentage growth, market share in the market, future revenue targets as well as creating more values for stakeholders are examples of corporate objectives, which helps in running of the organization. This makes the organisation have a strong link between the corporate objectives and the corporate communication.
Analyze the relationship between corporate communication and corporate branding
There is a great relationship between the corporate communication and corporate branding. Corporate branding is the symbol used by corporate to identify itself to its audiences or clients. Corporate branding is important as it helps in creating awareness and act as a reminder of the existence of an organization. It is through effective communication in an organization that will enhance corporate branding. In addition to corporate branding, we need to consider the corporate image, which is the perceived sum of organization such as plans and objectives. It includes management style, services, products and communication activities.
Demonstrate how you would plan an internal corporate communication audits
A communication audit is an indicator of a corporate current communication practices and their effectives. A communication audit can cover internal and external communication as separate or both depending on the desired outcome and the objectives of the corporate. An audit points out problems such as information blocks, information duplication and misunderstanding. When planning for a communication audits, formal and informal strategies should be used. For instance use of surveys which is a form of quantities research, use of interviews (qualitative research), analysis and reports and action planning. A communication audit is important in that it helps in highlighting current practices as well as possible lacking elements in an organization.
Explain how you would conduct an internal corporate communications audits
Here we have to consider various steps in corporate communication auditing. Determining key areas to audited. By considering both the internal and the external communications; consider everything from your standard branding pieces such as logos and business cards.
Choose research method. When conduction a corporate communication audits you have to select from a variety of research methods such as online survey, interviews and focus groups. This helps in collecting relevant information.
Collect and evaluate your past communications. Here you have to consider all the types of communications and information passed from the management to the middle and lower management. You need to ask questions like; who were our key audiences? Key messages? Did we reach our clients with the correct information? This helps you in knowing where to start with your corporate communication audits.
Look outward. This is where you focus on the customers and your community. Use questions to analyze your communication from your community and customers point of view. Try to find out what is their perception about your organization.
Look inward. Staffs and volunteers are the most important consideration in this stage. You need to collect their views about your organization’s communication. Ask, what are your reactions of communications during the past year? What could be improved? Did internal documents serve your needs? This helps you to have an overview of what is required of you, Put together a plan for future communications. You need to use your research as the starting point for making a corporate communication audit for your organization.
Critically evaluate the effectiveness of the current levels of practice in your organisation
In evaluating the level of effectiveness, you need to consider the commitment of the organisation. In terms of commitment, the organisation should be effective in that it ensures that all the objectives of organization are achieved through proper communication.
Another effective practice is the human resource. Through effective communication in the organization, various functions such as section, recruitment, in-services training are taken care off. Administration and finance control. In the running of the organization through effective communication of the set objectives, the management is in a position to control how the finances are used.
Explain how you would conduct an external corporate communication audits
An external communication audit is an indicator of current communication practices in an organization. It gives an organization’s information to the external stakeholders such as the local community, the government, the media, clients and suppliers. When planning for an external corporate communication audits you should consider various factors such as the target audiences. This will help in knowing the type of information you are going to pass from your organization to the target audience, thus enhancing the effectiveness of communication.
Demonstrate how you would conduct an external corporate communication audits
When conducting an external corporate communication audits, you have in use things like signage, posters, newspapers, voice messages and bronchus. The following steps are used in achieving it.
Understanding strategic communication practices. This helps in measuring your communication efforts. You need to ask questions that will help you determine strategic communication practices such as what is your communication vision. In addition, how does it relate to your organization’s mission? Are your communication goals well defined and measurable?
Identify the level of practice. There are various levels of practice such as institutional practices that are routine and improved over a time, Optimized practices are continuously evaluated and improved over a considerable period with sufficient resources.
Access the current performance. Here you need to know the levels of your organization performances through interviewing your audiences, use of focus groups. This helps in understanding where to start and what information to change about your organization.
Identify the areas for improvement. Getting feedback from your audiences, you now have an idea of where to change or improve in the organization. This enhances how communication has been done in the organisation. Here you need to ensure that media coverage is taken care off to pass the relevant information to the target audiences. After all this is done, you need to plan for future communication. This increases the effectiveness of your organization.
Critically evaluates the effectiveness of the current levels of practice in your organisation
As a result of effective communication in the organization there is a great change in practices such as community relation. This is as a result of corporate communication branding and imaging in the organization which helps the organization to change a lot. Through enhancement of communication with the local community; the organization has known the tastes and preferences of the community. Program management is another sector that is effective. Due to communication done with various departments in the organization, programs are run effectively thus enhancing the relationship
Financial management: It is through effective communication in the organization that budget administration is taken care of by knowing what the target audiences need you are in a position to budget well.
Demonstrate how you would plan the development of a corporate communication strategy
Having in mind what you need to achieve, you need to know what your communication plans are by asking yourself the following questions; do you want to improve your organization reputation? Do you want to generate more online or offline news coverage? You just need to lay down your organization objectives. The objectives need to be SMART: specific, measureable, achievable, realistic and time.
In planning your strategy, you need to define how you will achieve you objectives. Your strategy should include a profile start such as; do you want to generate maximum or minimum coverage? By having this in mind you are in a position to have an effective corporate communication strategy in your organization.
Selecting the audiences to influence with a corporate strategy
When selecting audiences to influence your corporate communication strategy you need to consider both the internal and external audiences in your organization. First consider how employees who are the internal audiences influence your communication strategy. What information about your organization do you want to pass to your employees? Consider the external audiences such as the media, suppliers’, clients and how they influence your communication strategy. The information about your organization passed to the audiences should be clear information in order to protect the image of your organization. Both the internal and external audiences influence your communication strategy as you need to know how to deal with them.
Plan appropriate measures to monitor a planned corporate communication strategy
Participatory monitoring and evaluation covers any process that allows all stakeholders – particularly the target audience – to take part in the design of a Project, its ongoing assessment and the response to findings. It gives stakeholders the chance to help define a programme’s key messages, set success indicators, and provides them with tools to measure success. They include problem ranking, surveys and mapping. This helps in monitoring your communication strategy.
Hopper M – Organisational Communication Satisfaction (LAP Publishing, 2010) ISBN: 3838317084.
Blundell R and Ippolito K – Effective Organisational Communication: Perspectives, Principles, Practices (FT-Prentice Hall, 2008) ISBN: 0273713752.
Beyerlein M M and Harris C L — Guiding the Journey to Collaborative Work Systems: A Strategic Design Workbook (Jossey Bass Wiley, 2003) ISBN: 0787967882.
Clutterbuck D and Hirst S — Talking Business; Making Communications Work (Butterworth Heinemann 2003) ISBN: 0750654996.
Dawson R — Living Networks: Leading Your Company, Customers and Partners in the Hyper-connected Economy (FT-Prentice Hall, 2003) ISBN: 0130353337.
Daya K T — International Communications: Continuity and Change (Hodder, 2000) ISBN: 0340741317.
McKenzie J and van Winkelen C — Understanding the Knowledgeable Organisation (Thomson Learning, 2004) ISBN: 1861528957.
Preston P — Reshaping Communications (Sage Publications, 2001) ISBN: 0803985630.
Quirke B — Making the Connections: Using Internal Communication to Turn Strategy into Action (Gower, 2002) ISBN: 0566085178.
Quirke B —Communicating Corporate Change (McGraw-Hill, 1996) ISBN: 0077093119.
Stewart J (editor) — Bridges Not Walls; A Book about Interpersonal Communication (McGraw Hill, 2001) ISBN: 007240082X.