Ethical Leadership and The Lack Thereof

Tips for those looking to do business in intergrated marketing communications (social media advertising, promotions, digital marketing, etc).

The AMA, or American Marketing Association sets the tone for how marketers should communicate their offerings; following their ethical best practices can also ensure compliance with the FTC, or Federal Trade Commision. To better explain the importance that any future entrepenure and general businessperson should adhere to to avoid the possible consquences beyond monetary damage- Let’s examine a recent example from 2014 with a major telecommunications company, AT&T.

Before diving into the incident that occured in 2014 it is important to note the ethical values that are upheld by the American Marketing Association:

1. Responsibility– This value in marketing means to “accept the consequences of our marketing decisions and strategies.
   1. Strive to serve the needs of customers
   2. Avoid using corecion with all stakeholders
   3. Acknowledge the social obligations to stakeholders that come with increased marketing and economic power
   4. recognize our special commitments to vunerable market segments such as children, seniors, indivuals with low socioeconomic status, indiviuals not familar with marketing, and others who may be historically disadvantaged (AMA,2021)

In intergrated marketing communications this would mean that businesses have an obligation to take ownership for the results of there marketing decisions and strategies. In 2014 AT&T was sued by the FTC after their promotion of “unlimited” data speeds. What AT&T failed to disclose properly to consumers that their speeds would be throttled with as little as 2 gigbytes worth of usage (Fair,2019). This caused common devices to be nearly unusable in the beggining of the consumers data cycle. The judment of the lawsuit would not come to be until late 2019 due to AT&T fighting back against the cases validity since it is considered to be a “common carrier” (Fair,2019).

Fairness: To balance justly the needs of buyers and the interest of the sellers

1. Represent products in a clear way in selling, advertising, and other forms of communication. This includes the avoidance of false, misleading, and deceptive promotion
2. Reject the manipulations and sales tactics that harm customers trust.
3. Refuse to engage in price fixing, predatory pricing, price gouging, or “bait and switch” tactics (AMA,2021)

To a new business the way you fairly represent your business sets the tone of the brand; which the public (consumers) have control of. It is harmful and negates the actual value of your organization, and offering if there is a miscommunication in advertising. For example, major businesses will use third party vendors to sell or market their offerings to different targeted markets beyond the typical brand’s normal reach to gegnerate more revenue. In these instances there are times where ethical morals can be lost for a commission on the marketers behalf. This causes harm to the organizations name, as the represenative may withold the truth and use manipulation tactics that could cause financial harm to consumers, and develop a negative relationship between consumers and the organization.

Respect- To acknowledge the basic human dignity of all stakeholders

1. Value indviual difference and avoid sterotyping customers, or depicting demograpghic groups ( race, gender, sexual orientation, religious, etc) in a negative or dehumanzing way.
2. Listen to the needs of customers and make all reasonable efforts to monitor and improve their satisfaction an ongoing basis.
3. Make every effort to understand and respectfully treat buyers, suppliers, intermediaries, and distributors of all cultures
4. Acknowlege contributons of others
5. Treat everyone; including competitors how we wish to be treated. (AMA, 2021)

This value in intergrated marketing can be seen in a recent issue that Meta formerly known as Facebook just encoutered with the Justice Department that challenged the algorthrimic biases that were deployed when determining which users recieve housing ads; violating the Fair Housing Act. The technology added a “lookalike” filter for marketers to target potential consumers based soley on prohibited characterisitics (Wiggers, 2022). When deciding on a target market, or even a niche it is important not to be discriminatory in practices, and to maintain satisfaction, acknowlegment to certain influences and overall mindful of how the organization treats others.

Transparency: To create a spirit of openess in marketing operations.

1. strive to communicate clearly with all constituates
2. Accept constructive criticisms from customers and other stakeholders
3. Explain and take appropriate action regarding subsitutions or other foreseeable eventualities that could affect customers or their preception of the purchase decision.
4. Disclose list prices and terms of financing as well as available price deals and adjustments (AMA, 2021).

In an intergrated marketing campaign this simply means to make information clear and accesible to all who may do business with the comapny. It is important to note here that stakeholders include those that are crucial to your business such as consumers, investors, executives, employess and so forth.

Citizenship: To fulfill the economic, legal, philanthropic and societal responsibilities that serve stakeholders.

1. Strive to protect the ecological enviroment and communicate sustainability efforts and aspirations honesly and transparently in the exection of marketing campaigns.
2. contribute to the overall betterment of marketing and its reputation
3. give back through volunteerism and chartiable donations (AMA,2021).

Finally citizenship is important to in mind as it shows that a major coporation is ensuring that they are helping the very consumers that they depend on to survive. For new incoming business owners this would be one of the most important ethical best practices that should become an intergral part of operations and vision. By giving back to those that the organzation impacts shows a level of humanistic morality and supports consumption.

If these values are ignored by coporations and businesses concerns of legality arrise. These concerns can cause investigation into practices to ensure that they are in the best interest of the consumers and business partners alike. Monetary damages to repuational devestation, and legal issues can all be a consquence of neglecting to follow the ethical best practices listed above.

For more information feel free to visit the sources listed below! Good luck on your professional journey and remain in your ethical best!

Sources

AMA. (2021). AMA Statement of Ethics. AMA Online Portal. Retrieved June 26, 2022, from https://myama.force.com/s/article/AMA-Statement-of-Ethics

Staff, the P. N. O., Staff, D. P. I. P. and C. T. O., Fair, L., Guest, ell, S., AnitaO, Staff, F. T. C., Sheppard, E., Sherryann, Gill, C., Dg, MsC, Kincer, W., Cathy, Emerson, B., Emerson, C., Harris, V., Cook, C., Chanel, … Fair, L. (2022, June 9). FTC settlement returns $60 million to consumers affected by AT&T’s throttling practices. Federal Trade Commission. Retrieved June 26, 2022, from https://www.ftc.gov/business-guidance/blog/2019/11/ftc-settlement-returns-60-million-consumers-affected-atts-throttling-practices#:~:text=In%202014%20the%20FTC%20sued%20AT%26T%20Mobility%2C%20LLC%2C,web%20browsing%20and%20video%20streaming%29%20became%20nearly%20impossible.

Wiggers, K. (2022, June 21). Meta settles lawsuit with Justice Department over ad-serving algorithms. TechCrunch. Retrieved June 26, 2022, from https://techcrunch.com/2022/06/21/meta-settles-lawsuit-with-justice-department-over-ad-serving-algorithms/