Ethical considerations as an element of a marketing system and their correlation with system efficiency

• Importance and Key Contribution The article analyzes the notion of a marketing system with regards to its adherence to ethical principles. This may expand the boundaries of marketing as a social and macro-level discipline... [ view full abstract ]

• Importance and Key Contribution
The article analyzes the notion of a marketing system with regards to its adherence to ethical principles. This may expand the boundaries of marketing as a social and macro-level discipline and improve its image in the modern world. The importance of this article lies in an effort to address the questions of interaction between marketing systems and ethical principles.

• Theoretical Base
A marketing system may be roughly defined as a network of entities engaged in economic exchange to create economic value in response to customer demand (Layton 2007, 230). In Layton’s MAS theory, marketing systems comprise the following: a) a set of primary and secondary social mechanisms; b) relevant marketing structures within a contextualized environment; c) networks of system participants and their relationships clustered around strategic action fields (SAFs); d) general system purpose, which is co-creation of economic value, increasing assortment diversity and improving quality of life (Layton 2015, 307). The latter means that marketing systems should contribute to general welfare. Reversely, there is enormous literature on how marketing systems are detrimental for general welfare and may contradict ethical, environmental and social principles, which gave rise to several marketing schools, including macromarketing, critical marketing, social marketing and macro-level social marketing, as well as business ethics or corporate social responsibility (CSR) (Schwartz and Carroll, 2003; Polonsky et al, 2003; Anker and Kappel, 2012; Boulouta and Pitelis, 2014; Hastings and Domegan, 2014; French and Gordon, 2015; Kennedy, 2015; Melé, 2016). Layton (2015) provided examples of how marketing systems can cause social disruption, conflict, inequality and environmental concerns, while reverse effects, such as social fabric invigoration, conflict settlement, diversity and positive socialization, can also transpire. However, what might be left out of the scope of the MAS theory, is the question whether marketing systems may be considered as possessing inherently anti-ethical or ethical features deeply embedded in their nature. If the intrinsic ethical-unethical duality of a marketing system is a case, it means the presence of a strong negative intrinsic component in marketing systems. In contrast to viewing marketing system via such ethical-unethical duality, the MAS theory allows us to consider marketing system in a positive key [what it is approach, according to Hunt (2010) three-dichotomy model], and, by understating its complex nature, we may mitigate unethical consequences of marketing systems. The latter should be primarily a concern of businesses, which start to understand the strategic relevance of ethical issues (Hansen and Schaltegger, 2016: 195). However, macro-social marketing and systems theory point to the fact that the mitigation of detrimental impacts of marketing systems is not limited to just changes in businesses because of the interconnectedness of wicked problems throughout the social, cultural and other systems (Kennedy, 2015).
Adherence to CSR-based principles becomes a matter of raising company or even national competitiveness (Porter and Kramer, 2006; Boulouta and Pitelis, 2014). However, it raises questions about the degree of such efficiency or genuineness of these efforts on behalf of companies. Business entities often only declare these principles and want to just look ethical (Crocker and Lehmann, 2014). Quite commonly, they understand these principles through their own lens. The association between adherence to ethical principles and business efficiency is complex, non-direct and sometimes negative. Ethicality can increase or decrease marketing system efficiency (Kennedy, 2015: 3). There are a number of concerns that are associated with the link between CSR and business competitiveness, including definitional elusiveness, ontological controversies, difficulty in scaling-up the link from firm-based to national levels (Boulouta and Pitelis, 2014). The present analysis confirms that adherence of marketing systems to ethical principles is a complex multi-dimensional issue, with elements of unethicality deeply entrenched in the very nature of marketing systems. A marketing system can behave ethically and/or unethically in a non-linear and context-dependent manner. Nevertheless, the present article advocates the idea that orientation of marketing systems towards ethical goals is highly plausible and desirable.

• Research Questions & Method
The marketing system concept gives rise to several important questions:
1) Can marketing systems be contradictory to ethics by nature?
2) To which extent can marketing systems be normative?
3) Do marketing systems need to implement ethics to be effective?
4) Can the link between ethicality and marketing system efficiency be strengthened?
Literature review and some elements of modelling, via feedback loop diagrams, are utilized.

• Findings (if relevant)
The analysis of a marketing system with the help of Layton’s MAS theory allows to single out a number of marketing system elements that may be clearly contradictory or complimentary to ethical principles. Table 1 summarizes some of these MAS-related elements, as well as ethics-related challenges and opportunities corresponding to them (Fligstein and McAdam, 2011; Layton 2015). It tells that a marketing system by its nature can have discrepancies with principles of social justice, equality and ethics. However, these discrepancies are not absolute and can be reversible through the application of mechanisms embedded into a marketing system itself, which means that marketing systems could be part of a problem, but also part of a solution. To mitigate the former, we need to adequately understand the underling mechanisms and complex feedback relationships that characterize marketing systems, and use this for our benefits.

Table 1. Marketing systems: ethicality-related challenges and opportunities.

'Table 1 e-mailed to conference chair'

Table 1 confirms that contradiction with ethical principles may be considered as lying at the very heart of any marketing system, but it does not mean that marketing systems should necessarily contradict ethical principles. Marketing system unethicality is associated with specific context and different viewpoints. The ethical component in a marketing system can be harnessed. The article provides an example how the MAS theory, backed by systems thinking and modelling techniques, can be used to model system elements associated with raising ethical component of the marketing system.

• Implications
Analysis of the link between marketing systems and ethical principles is considered of interest. This link is complex, dynamic and non-linear. The ethical component in marketing systems can be increased. The modelling of the factors that can increase this component is viewed as initial but important step towards raising general ethicality of marketing systems.

• References
Anker, T.B. and Kappel, K. (2012) “Ethical Challenges in Commercial Social Marketing,” in The Sage Handbook of Social Marketing, G. Hastings, K. Angus and C. Bryant, eds. London: Sage, 284-297.
Boulouta, I. and Pitelis, C.N. (2014) “Who Needs CSR? The Impact of Corporate Social Responsibility on National Competitiveness,” Journal of Business Ethics, 119 (3), 349-364.
Crocker, R. and Lehmann, S. (2014) “Prologue: Motivating change in consumption and behaviour” in Motivating Change: Sustainable Design and Behaviour in the Built Environment, R. Crocker, S. Lehmann, eds. London: Routledge, 1-9.
Fligstein, N, and McAdam, D. (2011) “Toward a General Theory of Strategic Action Field,” Sociological Theory, 29 (1): 1-26.
French, J. and Gordon, R. (2015) Strategic Social Marketing. London: SAGE.
Hansen, E.G. and Schaltegger, S. (2016) “The Sustainability Balanced Scorecard: A Systematic Review of Architectures,” Journal of Business Ethics, 133 (2), 193-221.
Hastings, G. and Domegan, C.T. (2014) Social Marketing: From Tunes to Symphonies. Abingdon: Routledge.
Hunt, S.D. (2010) Marketing Theory: Foundations, Controversy, Strategy, Resource-Advantage Theory, Armonk, NY: M.E. Sharpe.
Kennedy, A.-M. (2015) “Macro-social Marketing,” Journal of Macromarketing, 35, 1-12.
Layton, R.A. (2007) “Marketing Systems: A Core Macromarketing Concept,” Journal of Macromarketing, 27 (3), 227-42.
Layton, R.A. (2015) “Formation, Growth and Adaptive Change in Marketing Systems,” Journal of Macromarketing, 35 (3), 302-319.
Melé, D. (2016) “Re-thinking Capitalism: What We can Learn from Scholasticism?” Journal of Business Ethics, 133 (2), 293-304.
Polonsky, M.J., Carlson, L. and Fry, M.-L. (2003) “The Harm Chain: A Public Policy Development and Stakeholder Perspective,” Marketing Theory, 3 (3), 345-364.
Porter, M.E., and Kramer, M.R. (2006) “Strategy and society: The link between competitive advantage and corporate social responsibility,” Harvard Business Review, 84 (12), 78-92.
Schwartz, M.S. and Carroll, A.B. (2003) “Corporate Social Responsibility: A Three-Domain Approach,” Business Ethics Quarterly, 13 (4), 503-530.

marketing system, ethics, MAS theory [ view full abstract ]

marketing system, ethics, MAS theory