Customer Relationship Marketing

Customer Relationship Marketing

INTRODUCTION

Relationship management is a special field of its own, it is as important as preserving and enhancing the intangible asset known as “goodwill” as the management of hard assets.  The fact that it is probably harder to do is that much more reason hard effort be expended to do it                                                                                                                                                                                                                      –Theodre Levitt.

Relationship Marketing is one of the hottest trends in marketing today. Relationship marketing is a philosophy of doing business.  It is gaining increasing popularity in the business world. Relationship Marketing is the process of attracting, maintaining and enhancing relationship with key parties – customers, suppliers and distributors in order to earn and retain their business and honor their long term preference. The main purpose of relationship marketing is to build a unique company asset known as ‘Marketing Network’. The underlying idea is to simply build an effective and efficient network of relationship with key stakeholders and the profits will follow automatically.

Two Basic tasks;

  • Increasing the number of those factors which lead to customer satisfaction and loyalty
  • Avoiding those factors, which lead to customer dissatisfaction and brand switching;

Objectives of Relationship Marketing

  • The primary objective of relationship marketing is to build and maintain a group of committed customers
    • To find out the group of new customers, which hold better promise than the others. 
    • To know the Loyal customers can be even better customers if they buy more products and Services
  • To know about customers move from one life cycle stage from another, needs
  • To know about buying pattern fluctuates and product choices shift.
  • To know the customer  relationship of the Company should recognize such change of needs and wants
  • To achieve this firm will focus on attraction and retention of the customer
  • To enhancement of customer relationship.

Importance of CRM  

  • CRM is an integrated information system that brings together information about consumers, marketing effectiveness, sales and market trends.
  • It enables business to combine technology and human resources to understand the consumer behavior.
  • Relationship marketing uses improved information technology to regularly interact with firm consumers and to base product offerings on the consumer’s buying habits.

Traditional Marketing V/S Relationship Marketing

                        The traditional marketing, known as Transactional marketing focused. On mass production, mass marketing and standardized products and service. Relationship marketing, the focus has now shifted to highly customized and personalized products and service.

The Difference Between Traditional and Relationship Marketing

TRDITIONAL

RELATIONSHIP MARKETING

1.

Prominence on single sale transaction.

Prominence on retaining the customers.

2.

Quality of the product is the sole

 Responsibility of production.

Quality of the product is a concern for everyone.

3.

Direction on product or service features.

Direction on product or service benefits.

4.

Little importance on customer service

Strong importance on customer service.

5.

Short time scale.

Long time service.

Model of Relationship Marketing

                        The Model of Relationship Marketing the cost of acquiring a new customer is almost ten times the cost of retention of a customer which means that it’s much easier and more inexpensive to make an additional sale to an existing customer than to make a new sale to a new customer. As per Pareto’s Law, 80% of the total sales come from 20% of the customers. The need for relationship marketing, the core of which is customer retention.

 Relationship Marketing Model

INPUT

PROCESS

OUTPUT

Value–added products and Service

High customer satisfaction

One-on-one relationship

Increased customer share

Individual care and attention

Relationship Marketing

Lower marketing costs

Special facilities and services

Positive word –of –mouth

Structural ties

High brand equity

Information sharing

High customer loyalty

 Benefits of Customer Relationship Marketing:

  • It gives good image
  • It developed brand equity, customer retention and loyalty.
  • It Builds goodwill in the market,
  • It Keeps competitors away from customers’ sight,
  • It gives more customer satisfaction,
  •  Satisfied customers bring other  potential new customer
  • Facilitates employee retention for strong base of satisfied customers
  • Positive word of mouth
  • Turns customer into your friend.

To Customers:

               Customers will remain loyal to a firm when they receive greater value relative to what they expect competing firms. 

  • Customers will comfortable in the relationship.
  • Firm knows what to expect the Customers,
  • Customers has a good working relationship with the organization
  • Customers know Firm will be taken care of even for an unusual request.

To Confidence Benefit:

               These benefits comprise feelings of trust or confidence in the provider, along with a sense of reduced anxiety and comfort in knowing what to expect.

To Social Benefit:

               In some long-tern customer – firm relationship a service provider may actually become part of the consumer’s social support system. 

 Benefit to the Organization:                                       

  • To Increase in purchase:

The consumers are satisfied with the quality and services provided by the company they will give more business to the firm.

  • To Lower Costs:

               It is important fact for retaining old customers and gets new customers. Services are normally complex and difficult to evaluate before actually buying it, consumers most often look to others for advice on which providers to be considered.  Satisfied, loyal customers are likely to provide a firm with strong word-of-mouth endorsements.

Suggestions for Effective Relationship Marketing            

  • Companies should set up an independent relationship marketing department.
  • Confidence should be placed not only on technical people but also on relationship managers.
  • Provide additional compensation and incentives to sales personnel dealing with customers.
  • There should be an integrated marketing system to build relationship with customers , suppliers, dealers and other parties
  • Companies should keep a look out for value building approaches on an ongoing basis
  • Regular interaction with customers
  • Be proactive, not reactive in marketing the product or service.

Conclusion

            Modern marketing revolves around the customer.  It is an old and by-now universally accepted concept that the Customer is the King.  Customers are treated as the eyeballs of all major companies in the world. The primary of relationship marketing is to build and maintain a group of committed customers who are profitable for the organization.  With the advent of relationship marketing, companies are prepared to do anything and everything to keep their customers happy and satisfied.  A satisfied customer is not going to shift his loyalty to the competition’s grab for additional sales.  Business firms are now willingly engaged in constant improvisation, personalization and customization, marking a visible shift form “marketing myopia” to “marketing hypermetropia”.  Present scenario of the business in the world relationship marketing is very important to retain old customers and get new customers.

 Reference:

  1. Payne. A (1996), The Essence of Service Marketing, Prentice Hall India, Eastern     Economy Edition New Delhi.

2. Crosby, L, A., Eavans. K.R .and Cowles D… (1990), Relationship Quality in Service Selling: an Interpersonal Influence Perspective, Journal of Marketing, July, pp 68-81.

  1. 3. Dr.AtulDhyani, Relationship Marketing a New Challenge, Indian Journal of      Marketing, February, 2003

4. Sudhir Chowdhary, Customer Relationship Management (CRM) One-to-One Marketing,

   Computers Today

Source by venkatachalam

FAMILY LIFE CYCLES AMD ITS IMPACT ON MARKETING

FAMILY LIFE CYCLES AMD ITS IMPACT ON MARKETING

Families pass through a series of stages that change them over time. This process historically has been called the family life cycle (FLC). The concept may need to be changed to household life cycle (HLC) or consumer life cycle (CLC) in the future to reflect changes in society. However, we will use the term FLC to show how the life cycle affects consumer behavior.

Family Life Cycle Characteristics

The traditional FLC describes family patterns as consumers marry, have children, leave home, lose a spouse, and retire. But consumers don’t necessarily have to pass through all these stages-thy can skip multiple stages

Stages in Family Life Cycle

Young Singles

Young singles may live alone, with their nuclear families, or with friends, or they may co-habitate with partners in this stage. Although earnings tend to be relatively low, these consumers usually don’t have many financial obligations and don’t feel the need to save for their futures or retirement. Many of them find themselves spending as much as they make on cars, furnishings for first residences away from home, fashions, recreation, alcoholic beverages, food away from home, vacations, and other products.

Newly Married Couples

Newly married couples without children are usually better off financially than they were when they were single, since they often have two incomes available to spend on one household. These families tend to spend a substantial amount of their incomes on cars, clothing, vacations, and other leisure activities. They also have the highest purchase rate and highest average purchases of durable good (particularly furniture and appliances) and appear to be more susceptible to advertising.

Full Nest I

With the arrival of the first child, parents begin to change their roles in the family, and decide if one parent will stay to care for the child or if they will both work and buy daycare services. In this stage, families are likely to move into their first home; purchases furniture and furnishings for the child; and purchase new items such as baby food, toys, sleds, and skates. These requirements reduce families’ ability to save, and the husband and wife are often dissatisfied with their financial position.

Full Nest II

In this stage, the youngest child has reached school age, the employed spouse’s income has improved. Consequently, the family’s financial position usually improves, but the family finds itself consuming more and in larger quantities Consumption patterns continue to be heavily influenced by the children, since the family tends to buy large-sized packages of food and cleaning suppliers, bicycles, music lessons, clothing, sports equipment, and a computer.

Full Nest III

As the family grows older and parents enter their min-40s, their financial position usually continues to improve because the primary wage earner’s income rises, the second wage earner is receiving a higher salary, and the children earn from occasional and part-time employment. The family typically replaces some worn pieces of furniture, buys some luxury appliances, and spends money on education. Families also spend more on computers in this stage, buying additional PCs for their older children. Depending on where children go to college and how many are seeking higher education, the financial position of the family may be tighter than other instances.

Married, No Kids

Couples who marry and do not have children are likely to have more disposable income to spend on charities, travel, and entertainment than others in their age range. Not only do they have fewer expenses, these couples are more likely to be dual-wage earners, making it easier for them to retire earlier if they save appropriately.

Older Singles

Single, age 40 or older, may be single again (ending married status because of divorce or death of a spouse), or never married (because they prefer to live  independently or because they co-habitate with partners), either group of whichmay or may not have children living in the household. This group now has more available income to spend on travel and leisure but feels the pressure to save for the future, since there is no second income on which to rely as they get older.

Empty Nest I

At this stage, the family is most satisfied with its financial position. The children have left home and are financially independent allowing the family to save more. In this stage discretionary income is spent on what the couple wants rather  than on what the children need. Therefore, they spend on home improvements,luxury items, vacations, sports utility vehicles, food away from home, travel, and product for their grand children.

Empty Nest II

But this time, the income earners have retired, usually resulting in a reduction in income and disposable income. Expenditures become health oriented, centering on such items as medical appliances and health, and medicines. But many of these families continue to be active and in good health, allowing them to spend time traveling, exercising, and volunteering. Many continue working part time to supplement their retirement and keep them socially involved.

Solitary Survivor

Solitary survivors be either employed or not employed. If the surviving spouse has worked outside the home in the past, he or she usually continues employment or goes back to work to live on earned income (rather than saving) and remain socially active. Expenditures for clothing and food usually decline in this stage, with income spent on health care, sickness care, travel entertainment, and services.. Those who are not employed are often on fixed incomes and may move in with friends to share housing expenses and companionship, and some may choose to remarry.

Retired Solitary Survivor

Retired solitary survivors follow the same general consumption patterns as solitary survivors; however, their income may not be as high. Depending on how much they have been able to save throughout their lifetimes, they can afford to buy a wide range of products. These individuals have special needs for attention, affection, and security based on their lifestyle choices. Marketers use the descriptions of these FLC stages when analyzing marketing and communication strategies for products and services, but they often add additional information about consumer markets to analyze their needs, identify

niches, and develop consumer-specific marketing strategies. A look at these roles provides further insight into how family members act in their various consumption-related roles:

1. Influencers: Those family members who provide information and advice and thus influence the purchase. The housewife tells her family about the new eatery that has opened in the neighborhood and her favorable description about it influences her husband and teenaged children.

2. Gatekeepers: Those family members who control the flow of information about a product/service thus influencing the decisions of other family members. The teenaged son who wants a racing bicycle, may withhold from his father much of the relevant information on all brands except the one that he fancies, thereby influencing his father’s decision in favour of his preferred brand.

3. Deciders: Family members who have the power to unilaterally or jointly decide whether or not to buy a product or service. The husband and wife may jointly decide about the purchase of a new refrigerator.

4. Buyers: Those family members who actually buy a particular product or service. A housewife may be the person who actually buys all the foodstuffs, rations and toiletries, which are consumed by all the family members.

5. Preparers: Those family members who transform or prepare the product into the form in which it is actually consumed. The housewife may prepare the family meal using raw vegetables, lentils, spices, oil and other ingredients.

6. Users: Those family members who use or consume a particular product or service. All family members may use the car, watch the television, and listen to the stereo music system

7. Maintainers: Family member(s) who service or repair the product so that it will provide continued satisfaction.

8. Disposers: Family member(s) who initiate or carry out the disposal or discontinuation of a particular product or service.

Influencing Spouses and Resolving Consumer Conflicts

When making consumer decisions, husbands and wives commonly attempt to influence each other to arrive at what they feel to be the best outcome. Six influence strategies for resolving husband/wife consumption-related conflicts have been identified:

??Expert: At attempt by a spouse to use his or her superior information about decision alternatives to influence the other spouse.

??Legitimacy: An attempt by a spouse to influence the other spouse on the basis of position in the household.

??Bargaining: An attempt by a spouse to secure influence now that will be exchanged with the other spouse at some future date.

??Reward: An attempt by a spouse to influence the behaviour of the other spouse by offering a reward.

??Emotional: An attempt by spouse to use an emotion-laden reaction to influence the other spouse’s behaviour.

??Impression: Any persuasive attempts by one spouse to influence the behaviour of the other.

These influence strategies tend to be used by either husbands or wives when they find themselves in disagreement or in conflict with the other spouse regarding specific consumer decision. For instance, we all have experienced occasions on which different restaurants to visit, see different movies, or go on a different type of family vacation. These are only a few examples of the almost endless possibilities of potential family consumption conflicts that might need to be resolved.

Children

As any parent knows, young children attempt to influence family decisions as soon as they possess the basic communication skills needed to interact with other family members (“Buy me a cookie”, “I want a Barbie doll”, “Let’s eat at McDonald’s”.). Older children are likely to participate more directly in family consumption activities. In a study of children aged 6 to 14, more than half indicated that they influenced family purchase decisions, such as choice of vacations, stereo equipment, and home computers. Other research indicates that children play relatively important roles when it comes to initiating interest in a new computer and in the actual purchase decision. The parent-child relationship, as it relates to consumer behaviour, can be viewed as an influence versus yield situation. Specifically, children attempt to influence their parents to make a purchase (to yield). In observing shoppers in a supermarket, it is quite evident that children attempt to influence their parents to make purchases of special interest (e.g., laundry detergents) for which they see ads on TV.

Teenagers and Post teens

A significant number of teenagers have discretionary spending in terms of spending patterns. High school students (those in grades 7 through 12) are most interested in sports and fitness. Boys between the ages of 16 and 19 spend most of their money on movies, dating, entertainment, vehicle expenses, and clothing, while girls of that age spend most of their money on clothing, cosmetics, and fragrances. The teen market can be segmented in terms of lifestyle groups. Figure below presents a four-category segmentation schema of the teenage market. Such segmentation framework has value for marketers who wish to focus their marketing efforts on a particular subgroup of teens.

Segment

Name Key Characteristics

1. Socially driven.

2. Versatile Participant

3. Passive Introverts

4. Sports Oriented

Primarily female; active and extroverted. They are optimistic and plan to attend College. Slightly more females than males: responsible teens, but less optimistic and less likely to plan to attend college than the Social Driven. They are comfortable in social and solitary situations. Slightly more males than females: withdrawn, self-conscious, and the least comfortable in social situations. They are less optimistic about, the future, and spend the least. Primarily males: outgoing, active, and greatly interested in participating in and watching sports. Sports influence their self-image and what they buy.

Lifestyle segmentation of the teen market Family marketing

Family marketing focuses on the relationships between family members based on the roles they assume, including the relationship between purchaser and family consumer and between purchaser and purchase decision maker. Family marketing identifies scenarios where some purchase might have more than one decision maker, whereas some have more than one consumer. The family marketing model, as see in Figure 3.1, represents nine cells describing various purchaser-consumer relationships. Depending on where in the matrix various products fall, marketers can advertise and position products differently

according to their  purchaser-consumer relationships. The family purchase decision-making process can be complex, but answering the following questions helps identify different purchaser-consumer relationships.

 The Family Marketing Model

Although these answers may not identify all essential relationships marketers should consider, they do identify a family marketing plan, which creates a relationship between individuals and products based on the role each individual has in the influence or purchase of products. In the restaurant industry, the trend has been to focus on marketing to the family as a single unit. Admittedly, the appeal to families arose from the restaurant industry’s desire to grow sales and profits.

R.yuvarani, M.phil Scholar,
Department of Commerce,
Periyar University, Salem-11

Source by R.Yuvarani

Marketing; Channels And Types

A channel of distribution can be described as being either short or long.  Short channel mostly involves few intermediaries and long  channel distribution involves  many intermediaries working in siccession  to move goods from producers to consumers.  Channel of distribution of service firms is promarily short because they mostly sell intagible products and need to maintain personal relationships within their channels. Intermediaries in marketing helps in the following;many producers lack financial resources to carry out direct marketing,in some cases direct marketing simply is not feasible,makes/assists in efficiency making goods be widely available and accessible to target market,they smoothen the flow of goods and services.

There are so many factors that a company should consider choice of distribution;product consideratio which are;unit value,bulk and weight,technical nature,age of the product,product line,etc. Market considerations which are nature and type of consumers is an important consideration in choice of a channel of distribution. Companys channel of distribution  directly affect every other marketing decision . Sometimes distribution decisions can give a product a distinct position in the market. The choice of retailers and other intermediaries is strongly tied to the product itself.(Philiph,2002)

Understanding customer needs help marketers to manage  the market and meet their demands. Customer needs indetifications leads to customer retention whch is important. This also helps in attracting lost customers. When all departments works together this industry will  definately improve and this results to integrated marketing. By producing goods which will suit the market and meeting their needs and expectations will help in improving the industry.

Direct channel involves where producer distributes his goods or services to consumers directly or by himself,by doing this the cost of distributing this products is cut short. Only one middleman e.g in supermarket  buys directly buys good from manufacturers and sell them to consumers. It is the shortest and most direct,the channel is fast and economical . producer has direct contact with his customers and has full control over contribution.Indirect channel of distribution involves middlemen who assists in promotion,transporting,packaging and grading,storage,selling and dispersing and financing.

Consumer behaviours may also affect the choice of channel of distribution,there is complex buying behaviour where consumer engages in complex buying behaviour ,this is when the product is highly expensive,it is infrequently bought,it is risky and is highly self expressive onother type of buying behaviour that affects channel of distribution is reffered to as variety seeking behaviour,this is when there is low consumer involvment in the purchase because the product is inexpensive and frequently bought.(Irwin,1996)

The first step in selecting a marketing channel is determining which type of channel will best meet both the seller’s objectives and the distribution needs of customers. choice of retailers and other intermediaries is strongly tied to the product itself. Manufacturers select mass merchandisers to sell mid-price-range products while they distribute top-of-the-line products through high-end department and specialty stores. The firm’s sales force and communications decisions depend on how much persuasion, training, motivation, and support its channel partners need. Whether a company develops or acquires certain new products may depend on how well those products fit the capabilities of its channel members.(Kevin,1994)

The best channel members to use in telamarketing industry is that one from producer to retailer,this is because various marketing functions are performed by producers and retailers, in this way the customer also are in a better position to ask questions about the services or products being offered to them. There are many criterias of selecting members of channels of distribution they are:Intensive distribution – Where the majority of resellers stock the ‘product’ (with convenience products, for example, and particularly the brand leaders in consumer goods marprice competition may be evident.Selective distribution – This is the normal pattern  where ‘suitable’ resellers stock the product.

Exclusive distribution – Only specially selected resellers or authorized dealers are allowed to sell the ‘product’. The most appropriate  channel distributor to use in this industry is intensive distributio because the market share is large.

A number of alternate ‘channels’ of distribution may be available in telemarketing industry, this include;distributor who sells to retailers,retailer who in otherword is  known as dealer or reseller who normally sells to the end customer or consumer,advertisement which is typically used for consumption goods.Distribution channels may not be restricted to physical products alone. They may be just as important for moving a service from producer to consumer in certain sectors, since both direct and indirect channels may be used.

Source by LindaMiller

How to write Marketing Communications Plans?

Marketing communications are all strategies, tactics, and activities involved in getting the desired marketing messages to intended target markets, regardless of the media used. It is the process by which a marketer develops and presents stimuli to a defined target audience with a purpose of eliciting a desired set of responses. Marketing communications is: adverting, sales promotions, personal selling, PR and direct and interactive marketing.

When writing marketing communications plan it is important to:
1. Set corporate, marketing and marketing communications objectives, which would support and integrate with each other.
2. Develop segmentation, targeting and positioning strategies
3. Develop creative message with which Marketing Communications Plan with communicate with target audience
4. Select and justify one or combination of marketing strategies (push, pull or profile)
5. Develop well-rounded and creative set of promotional mediums and allocate appropriate budget for each medium.
6. Create contingency planning strategy (in case something goes wrong)
7. Set strict set of evaluation and control mediums which would include milestones and continuous evaluation

 

 

Ethical Issues When Marketing To Children

Introduction

Marketing ethics is an area that deals with the moral principles behind marketing. Ethics in marketing applies to different spheres such as in advertising, promotion, pricing. However, for purposes of this essay, the ethics of advertisements will be dealt with especially in relation to children. (Mohandeep, 2001))

Many marketers and analysts have agreed that children are marketer’s best friend. This is backed up by evidence from watch groups such as Media Channel. In the year 2007, they highlighted the fact that in the United States, close to two billion dollars was spent on advertisements to children. It was also revealed that children greatly affect the commodities their parents buy. Estimates done in this field show that projects tailored for children in the year 2006 totalled fifty two billion dollars. (McGee and Heubusch, 1997)

Regardless of all this potential returns that children can give manufacturers and their marketers, there are key ethical issues that arise in the discussion. For example, do children have the capability of understanding some of the intricate marketing tactics? Do children posses the final buying power? Do marketers need to get permission from their parents? And do children understand the negative effects of some of the products advertised to them? These key questions will be analysed in relation to business pressures then recommendations will be made.

Key ethical issues in marketing to children

Involving psychologists in market research

Some companies have become notorious for the utilisation of psychologists in their advertising and marketing campaigns. Normally what such companies do is that when trying to create marketing strategy, they will involve psychologist to tell them about tactics that they can use to influence children. Since psychologists understand the way child’s mind works, they can help marketers create campaigns that will be directly aimed at them and those ones that can easily influence their choices. This trend has becoming so alarming that the American Psychological Association has raised an alarm about it. They have set up a committee to estimate the effect that the involvement of psychologists in the marketing process of children’s products has on them. The group has asserted that no psychological principles should be used when marketing to children. They are also recommending that there should be some sort of strategy to protect the young ones from exploitation though the use of psychological ploys. (Beder, 1998)

The basic framework which steers marketing ethics revolves around three main issues. These are;

  • values
  • stakeholders
  • processes

Marketing ethics that are done on a value inclined framework are those one that involve the analysis of the kind of value that the marketing idea creates. So advertisements may instil in their target audiences positive or negative attributes. This all depends on their implementation. For example, an advertising targeting a child may become a problem if it violates the right to privacy, transparency, honesty or autonomy. By using psychologists in the process of creating advertisements for children, marketers are imposing upon children’s right to autonomy and transparency. They try studying children’s behavioural trends and then use this to exploit those children. This is quite unethical.

The process oriented framework in marketing ethics is founded on the basis of analysing marketing ethics through the categories that marketers use. For example research, promotion and placement must be done in an ethical manner. This is something that marketers have chosen to ignore because their research is not done in an ethical manner. Their research involves using psychological experts who may use their knowledge to take advantage of children who belong to vulnerable groups (Lizabeth, 2001)

Targeting children alone

Marketers who create marketing campaigns that are just directed towards children only are engaging in unethical marketing practices. This is because children are naive. They are at a stage of development called proximal development. At this stage, children simply take up elements of what they perceive in the world around them and then use it in various aspects of their lives. There is a certain level of trust that children have over and above than one of adults. They lack the ability to weigh arguments in a sober and even sometimes a cynical way. Consequently, this makes them very vulnerable to exploitation. (Murphy et al, 2004)

Examples of advertisements that are directed towards children alone are those ones that have cartoon characters and are seen as specifically meant for children. At that point, children will feel like they are the only ones with the ability of purchasing the item yet it is their parents who have to foot the bill. Unethical advertisements are those ones that do not involve getting consent from parents. Most of the time such advertisements are usually aired in the afternoon during kid’s programming sessions. They usually create desires in children to have those advertisements at all costs. When advertising is done without parental consent; that is when children are watching shows on their own then it become unethical. Children are too young to realise the manipulations that are going on through television or media advertisements. They also do not realise the financial pressures that come with the purchase of items. It would therefore be unethical for marketers to leave parents out of their marketing strategies. Normally, ethical advertisements are those ones that require children to get their parents involved in the marketing place. This can be achieved by stating it directly in the advertisement. It can also be achieved by limiting some children’s products in parental magazines or targeting families in general instead of just children. (Waymack, 2000)

Advertisements targeting children alone have shown their effects in a number of ways. In the year 2007, it was found that about fifty eight percent of all the items purchased by children (through their allowances) are sweets and toys were the next highest items to be purchased by children. This took up a whooping thirty percent. Toys and candy are all items that are advertised directly children hence the staggering statistics. (Davidson, 2002)

Advertising to children alone brings out very fundamental ethical issue. It highlights the power analysis issue in marketing. Any form of marketing that claims to be ethical must adhere to the power balance principle. The scales must not be tipped towards the consumer neither should they favour the marketer either. When marketers target vulnerable markets, they tend to make the situation favour them. This is what is called caveat emptor in marketing. It is an unfair scenario and is also exploitative in nature. (McGee and Heubusch, 1997)

Types of products, manner of advertisements and other qualities can indicate whether or not an advertisement is targeting children. It should be noted that there are certain elements that if conducted by marketers may be deemed unethical for example, when an advertisement is made in such a manner as to imply that it is meant for children. Some elements to watch out for are;

  • music
  • images
  • voices
  • colour

These are all elements that are meant to draw on children’s attention. Besides this, there may be certain activities expected to captivate children such a drawing, then those advertisements may be meant for them. Besides that, some advertisements may have characters that are designed for that demographic group. Sometimes some advertisements may be placed in publications that are usually read by children alone. They may also be placed in areas that have children. (Murphy et al, 2004)

All these features can be deemed unethical if they will be seen or heard by children exclusively, For example, if the advertisement is placed in a publication that is read by children alone then this is unethical because there is not parental consent there or if it is broadcast at times when children could be watching without parental consent. (Lizabeth, 2001)

Sometimes the kind of content in the advertisements matters too. Advertisements that are created in such ways as to make children feel less about themselves if they lack that product may be deemed unethical. Also advertisements that will promote harmful products to children are also unethical. For example, there were certain toys from China that had an excess of chemical elements and exposed certain risks to children who were playing with them. If advertisements posses those characteristics, then they may be considered unethical.

Recommendations

Responsible marketing

The issue of marketing itself has two main components. The first group is made up of the abolitionists and the second are the libertarians. The abolitionists believe that all advertising to children is wrong and that it should be completely eliminated. But this is something that is unrealistic and cannot be feasible in today’s fast paced and commercial world. The other extreme is held by the liberalists who believe that advertisements to children should be left as they are. They insist that society shapes advertisements and that advertisements do not change moral values. But this is denying the obvious. The fact that children in the UK and even in other parts of the world spend the largest portion of their leisure time watching television implies that they will pick up some of the habits depicted on their screens. (Waymack, 2000)

In light of the above facts, it is important to come up with a compromise on the issue through taking up responsible marketing. Children can still be considered as a target audience for marketing of retail products, however, this should be conducted in such a responsible and socially sustainable manner.

There are three main alternatives available for marketers targeting children and these are;

  • viewing children as docile consumers
  • viewing children as non- consumers
  • viewing children as informed consumers

Choosing the non-consumer part would not be very market friendly because as it has been seen from earlier parts of the essay; children have substantial levels of buyer power. It is would therefore be uneconomical not to tap this very valuable market resource. On the other hand, viewing children as docile consumers causes a lot of ethical controversies that have been raised earlier. Consequently, the most sustainable form of marketing should be viewing children as informed consumers. Marketers need to advertise and market their products in such a way that there will still be room for them in the future. This will be effectively achieved by informing children about marketing ideas. This will enlighten them and give them a very valuable asset; choice. (McGee and Heubusch, 1997)

Informing children about the intricacies of marketing at an early age will go a long way in ensuring that children can understand the fundamentals of the commercial world. It will mean that children’s naivety will not be taken advantage of and that they will have the power to decide for themselves whether or not products are good for them. The ethical issues that have been brought forward stem from the fact that children are too young to understand the main reasons behind marketing displays. Informing them about this will drastically reduce those ethical concerns and will at the same time still allow marketers to go about marketing their products. (Beder, 1998)

It should be noted that some countries like Sweden have argued that children can understand the effects of commercial marketing after reaching the age of twelve; some have suggested four and others ten. They claim that at that point, be it 4, 10, or 12, children can understand the commercial world and the exploitation tendencies that their worlds present them. Consequently, human rights groups claim that marketers should not target children that fall below that group. But that debate can be eliminated if children below those established ages are made aware of the commercial world.

Regulations

This is something that is already in place, but still needs more emphasis. Advertisements should not be aired during children’s programming as they are likely to be unsupervised at that point. Governments should institute statutory regulations on television advertisements. Advertisements should also be edited such that they do not seem to appeal to the child directly. They should be made in such a way that they will involve the parent or family. (Mohandeep, 2001))

Conclusion

Advertisements to children have sparked off lot of controversy resulting in various reactions in various countries. However, experts agree that unethical marketing occurs when advertisements are directly aimed at children without getting consent from parents. Organisations can go about this issue through regulating their content, changing their times and embarking on a consumer education to make their young audiences aware. (Waymack, 2000)

Reference:

Beder, S. (1998): Marketing to Children, University of Wollongong Journal

Lizabeth E. (2001): Marketing With A Conscience: Sales and Ethics; Journal for the US Dept. of State

Mohandeep S. (2001): Ethics in Marketing; Encyclopedia of Business and Finance

Davidson, D. (2002): The Moral Dimension of Marketing; South-Western Educational Journal

Murphy, P. et al (2004): Ethical Marketing; Prentice Hall

Waymack, M. (2000): The ethics of selectively marketing the Health Maintenance Organization, Journal of Theoretical Medicine and Bioethics, Issue 8, Volume 11, Pages 301-309

McGee, T. and Heubusch, K. (1997): Getting Inside Kids’ Heads; American Demographics, Vol. 19, No. 1

Source by Carolyn Smith

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