MKTG 7050/6 - Study Questions
"Social & Legal Environment of Marketing"
A focus on misplaced marketing

These questions indicate possible directions for class discussions and should be used to prepare for class. Outreach students should use these to help them send in their required email discussions on the materials. As initially prepared by past students in the class, the readings or class might not provide direct and concrete "answers" to some of these items simply because many of these questions do not have a single concrete answer. The questions are presented to stimulate your thinking and to serve as a starting point for discussing many concepts that will be presented during the semester This fits with the general goals of the course: to develop your ability to analyze problems that arise when making marketing communications decisions.

Topic 1. History & Perspectives on Consumer Protection

1. In each "wave" of consumerism, the focus of "protection" was different, as what drove the movements. What was being protected in the early 1900s, during the 1930s? And just what is the difference between protecting the customer and protecting competition? How does it help us relate to issues today?

2. How did the initial consumerism movement change the market place forever? Was this change positive for the consumer? For the "big business"?

3. Why did government entities such as the FDA or the FTC really come about? Why would marketers want FTC or FDA regulation?

4. Just after the Civil War, there was no branding or advertising of products. In order to sell more, companies simply made more. In this type of environment, why would one even start marketing?

5. A major impact or impetus of the consumer movement was the so-called "guinea pig" books and, in an earlier time, Upton Sinclair's The Jungle. Why?

6. Is it possible to align the profit driven strategies of many businesses with a perspective that would place consumer protection as the forefront of the majority of business decisions? If so, what can be done to promote this?

7. In some senses, those who say "all government regulations are unnecessary" are using the perspectives of a century ago. How is this so and why do they want to turn back the clock?

Topic 2. The Modern Marketplace and Competition

1. What did Nader's book "Unsafe at Any Speed" do to the consumer movement in the early 1970s? How is similar to the earlier consumerism waves?

2. So just what was being protected in modern consumerism? And how are the following items related to these concerns:

SLAPP suits
Class action law suits
Anti-trust law enforcement (or non enforcement)
Misplaced Marketing

3. Why is competition in today's marketplace limited, and what limits it? Consider the soft drink industry: is this industry really competitive? With all the mergers that are taking place today, does competition really exist in telecommunications, radio broadcasting, cable television, soft drinks or some other industries? Is it more beneficial for the consumer (in a price sense) to have numerous products to choose from even if they are from fewer companies?

4. How do power relationships among corporations in American business affect the flow of information to consumers?

5. Why and in what ways do companies that are dominant in a marketplace or industry lose their marketing focus, with the absence of viable competition?

6. Is the modern consumer "king" or "serf" and why ?

Topic 3. A Marketing Perspective on Consumer "Rights"

1. Apply the concept of misplaced market to interpret the "Barnum" case. What were some of the misconceptions and misunderstandings of the success of P.T. Barnum? According to the St. Phineas Reading, how did P.T. Barnum help to discover business ethics? Did he really do that?

3. Some people like to assert that the only way to run a long-term successful business is through following a strict code of business ethics. Is an honest approach to business is the best way to achieve long-term success?

4. In the modern scene of business' relationship with consumers, there are three forms of misbehavior from businesses: Nonfeasance, misfeasance, and malfeasance. How are marketing and regulation a deterrence to corporate misbehavior? Car Salesmen often try to pull a fast one on unknowing customers. St. Phineas suggests that it would be better for the shady dealership to just sell cars honestly. From the perspective of the dealership, is this necessarily true?

5. Which entity (the government, consumerism activists, or businesses) has the most power in promoting and ensuring "proper" business behavior?

6. If you can make a lot of money while being dishonest, why be honest?

7. What do you think is the most misconceived attitude about marketing? What do you think causes these misconceptions? In what ways is the marketing point of view different from other points of view such as financial and legal implications that seem to underlie most business decisions. Does a marketing orientation really act to be protecting consumers?

Topic 4. The "Lost" Marketing Perspective

1. Is there a time when a production orientation is appropriate? Does it serve consumers?

2. What some examples of products that have extras/options that many consumers might never use? What are some of your own examples of products which contain unnecessary features or don't have feature combinations that your intuitively think should be desirable? In all cases, why do manufacturers do this? Between what divisions of the firm is communication about what the consumer "wants" and what the consumer "gets" severely breaking down?

3. Why do so many electronic firms take an engineering-over-marketing mentality? Are they following a product orientation to satisfy their customers' needs and wants? How does the average consumer probably respond to unnecessary features?

4. What is the root cause of having an employee who is improperly trained? Give a real life example in which one company is severely better in the service area than the other (both are attempting to serve the same customers) and the effects that it may have on the poorer company.

5. As a service department manager, is it possible to eliminate unhappy customers - not kill them, but make them happy?

6. "Relationship marketing" is a phrase used to refer to the use of marketing for the purpose of building of long-term relationships with the customer. Discuss how the information gathered for this purpose is used. Does this use necessarily tend to lead to the formation of long-term relationships? Why or why not?

Topic 5. Marketing Myths: The Case of Advertising

1. What defines a "good ad" or a "bad ad"? Do sexy or funny or star studded or very creative advertising messages always to the marketing job? Give some examples of advertising programs that seemed to be well produced and executed but seemed a waste of money. Or to put it another way, why do so many advertising campaigns seem to focus on getting attention for the advertisement but not the advertising object, and is this strategy an effective way of selling a product?

2. From a marketing communications point, when can sex sell? When should it be avoided?

3. Can you effectively advertise a political issue? A social issue? What are the bounds of advertising?

4. Advertising is often used as a way to counteract so-called "problem behaviors" (e.g. illegal drug use, road rage, date rape). Is advertising an effective way of fighting these behaviors? After all, advertising must "work" or else companies would not spend all that money on it, would they?

5. People like to blame advertisements for various problems or social ills. Does advertising really have this power, is it really just the ethical standards of the business practitioners that some people find offensive, or maybe, there is something else that engenders the complaints?

Topic 6. Perspectives on Modern Government Regulation

1. How do the governmental agencies (such as FDA, FCC) succeed and fail to serve the consumers' interest? Why (or when) are government regulations of advertising ineffective?

2. In terms of the consumers' interest, what is the difference between the FTC having to prove actual deception versus a potential or capacity to deceive? Is the difference bad for business?

3. Why would telemarketers like for there to be a do-not-call list? Which benefits the telemarketer most, consumers placing themselves on the list or having the ability to contact whomever they please?

4. "A person's education and vocation influence how problems and potential solutions are perceived." Who are traditionally the types of people that make up our government's regulatory agencies? What point of view do these people bring to the job and how does that influence the regulations they impose? Who should regulate business?

5. Advertising restrictions are sometimes used as a regulatory tool for some product categories (e.g. cigarettes). Is this an effective way of influencing demand for generic product categories?

6. Why might a business group lobby for industry wide regulations? What does the business stand to gain from increased regulation?

7. Sometimes, certain products are expressed to the consumer in legal jargon, that more often than not is misunderstood. This is bad marketing, why do particular firms within particular industries have trouble connecting with the average consumer?

7. Business Self-regulation

1. Is self-regulation a more effective marketing tool than governmental regulations in terms of serving the consumers' interest? What are the limits of self-regulation as a marketing tool? What could make self-regulation successful from a consumer's point of view?

2. How can TV broadcasters be encouraged to self-regulate? What is the reason most companies (in any industry) cooperate with self-regulation? Without the threat of government interaction, how would self-regulation ever work?

3. What role does self-regulation have in stopping false claims, and helping protect the public, is it effective by itself?

4. Self-regulation organizations claim their activities make them responsible corporate citizens, even though they do not possess any real power. Discuss how this statement pertains to the advertising practices of the distilled liquor industry.

5. Why are the NAD and NARB been efficient or effective in in controlling advertising deception? Could it also be asserted that they are not that effective? What is their relationship with the FTC?

6. As the housing bubble burst  and financial markets self-destructed, Alan Greenspan went before Congress to apologize. The blanket deregulation of financial marketing he had advocated for the prior two decades were based on a statement that "competition" and self-regulation would eliminate the need for government oversight. Why should he not have been surprised? Why didn't self-regulation take over and make government activity unnecessary?

8. Risk: Regulation, Self-Regulation and Marketing

1. Define perceived risk and how to evaluate perceived risk. What' the relationship between perceived risk and fear? What's the role of fears in cigarette marketing? How can (or should) corporations use consumer's fear to market their product? Targeting specific audience segments is a typical marketing strategy, but is it wrong to appeal to certain fears held by audiences?

2. Would marketing a safer cigarette be a good idea for a cigarette company? How would this help or hurt the company?

3. When an industry is self-regulated, is it possible to argue that it is better to break the rules than to miss out on possible sales?

4. Apply the cost-benefit analysis to a real life regulatory debate. What is the single problem with using the Cost-Benefit Analysis for regulations? What criteria should the government use when determining what should be regulated and what should be left alone? Is it a company or government duty to protect people from themselves, if so how should each address public safety/health issues?

5. Why are useless warnings put on labels? Do they serve a purpose? If so, for whom?

6. How does the public's perception of risk differ from products such as smoking, drinking, hunting, etc. than that of experts? Why is this a difference and how does it impact marketing decisions?

9. Marketing Abused

1. Discuss the difference between immoral and amoral decisions? What implications do the two have on current business practices? From the consumer's point of view, does the difference matter? How does this relate to common practice in movies or on TV to make a business person that hero's protagonist?

2. If many business practices and decision making is inherently amoral, where does that leave self-regulation ? What else you suggest could be done to protect consumer in an amoral marketplace? Why are so many business practitioners exhibiting a "whatever works" attitude?

3. In what cases could marketing actually help to maximize profits but also cause a business to lose customers at the same time?

4. What is the conflict between being socially responsible and providing a product your customers demand?

5. Why do so many companies continue to use "eye catching" but distracting ads in spite of the confusion they cause?

6. Some businesses use various methods to "trick" the consumer into purchasing a product. Confusion, frustration, offensiveness, and other tactics are considered bad marketing. Other businesses mislead consumers in an attempt to portray their firm in a good light. However, if they increase sales and provide returns for the company, is it successful marketing?

10. Marketing and Its Paranoid Critics

1. Why do people fear marketing, sometimes moreso than the dangerous products that use it? Even if marketing was clear and honest, would it still face critics?

2. Why is the advertising of some legal products so controversial? Is it fair to say that advertising is the motivation for these purchases? If not, what is the underlying reason for the criticisms? It could be said that the often-misunderstood distinction between generic and brand demand fuel the critics' fears - what does that mean?

3. How might some critics see market segmentation as an abused marketing tool with a possibility of being a destructive cultural force?

4. Does marketing have some subliminal power over consumers who view these advertisements? Beyond the power of suggestion, what power does advertising really have? Why do consumer's have the perception that marketers try to manipulate their minds? Could there be any validity to the question of whether or not marketing activities possess the ability to cause people to act in a fashion contrary to their own self-interest?

5. Controversial products are legal when purchased by responsible adults. How do you safely identify "vulnerable" groups? How do you keep your product away from those groups while selling to responsible adults? Or can you? Does advertising lead to higher consumption of criticized or dangerous products? (Note that criticized and dangerous are not synonyms!)

11. When Customers Aren't Right

1. Should a business satisfy the needs of all consumers? Why should there ever be exceptions?

2. Marketing has become an increasingly important aspect of political campaigns. What are some of the potential concerns of marketing being a driving force in elections? Do negative political ads work? If the ads persuade voters, are they effective? How is leadership lost when a political candidate uses a marketing strategy to gain an upper hand on their opponents?

3. How can the misuse or abuse of marketing detract from the overall message and image of a product? For example, The chapters talk about a drink that changed its composition in order to make the marketing slogan true. Is this an acceptable approach? What other options would marketers face in marketing the unaltered drink?

4. It was pointed out early in the semester that "consumerists" (in the consumer activist sense of the word) are not always the same as a company's consumers. Would government agencies provide an effective means of consumer protection without the actions of consumerists? Does responding to critics sometimes send an agency in the "wrong" directions?

5. How might allowing parents to choose which school their children attend hurt education as a whole? New Zealand stopped requiring students to attend neighborhood schools. How will these changes affect the overall quality of education?

6. How would marketing in education cause some major problems for society i.e., what are some implications of schools "giving out grades" and students only wanting the diploma without actually doing any work?

7. Is sports really a benefit for universities when looking at the aspect of education? What would a university be like without sports? Would education be better off?

8. Some say that students should be treated as the customers of their colleges. What problems might this "misplaced" relationship cause? What do you think should ultimately be the most influential characteristics offered by a school to encourage students to attend?

12. Specific Issues, Criticism & Consumer Protection

Marketing to children: Why do children really want certain products? Given that parents are often times "gatekeepers" to their children's purchases, what potential concerns arise from marketing to children? Can companies ethically market products directly to children?

Condom marketing: In certain industries, several marketing questions exist about marketing practices, or even that it should not be marketed at all. One of these industries is the condom industry. Should condom companies worry about parents who like to believe their kids do not have sex, or should the companies try to educate kids on the effects of unprotected sex? Does one have a greater benefit to society over the other, or are they both equally bad/good?

Alcohol marketing: Who should be responsible for controlling advertising for alcohol companies? How should they control such as advertising? Whose responsibility is it to monitor children from watching TV and seeing these commercials?

Credit & credit card marketing: Are credit card companies responsible for protecting college students from the dangers of credit? Is it socially irresponsible to issue credit cards to college students when you know both that current college students will have greater incomes in the future and that college students will use the cards irresponsibly? Is it possible to only issue credit cards to juniors and older? What is wrong with credit card companies marketing to college students, and can this ultimately hurt the credit card provider?

Pharmaceutical marketing to doctors: How might certain "loopholes" be filled in the pharmaceutical industry regarding the prescribing of a drug that is designed to treat one illness to treat something else? How might regulations be set up for drug reps handing out free samples of newly developed experimental drugs? Do you think that a doctor should receive gifts from sales representatives? Is there another way for pharmaceutical sales companies to market their drugs to doctors?

Non-drug Supplements: What might be some future implications of the supplement industry not being regulated by the FDA. Also, the problems associated with the labeling only having to read: "Not to be taken to treat or cure any disease only as a supplement to your daily diet"? How can marketers of dietary supplements get away with false advertising? What are the benefits dietary supplement companies receive for being able to deceive their customers in this way?

Product safety & marketing of SUVs: What motivates people to buy SUVs? Based on your answer, how should SUVs be marketed? In light of SUVs' poor safety records, is your marketing recommendation an acceptable one for car companies to take?

Manufacturer outsourcing overseas: What could a maker of a shoe or clothing brand do to enhance their public position when it comes to the manufacturing of their products in facilities overseas? Given their position in the marketplace, does a company like Nike have the power to affect change with respect to this practice? How can a company steer away from this bad stigma of sweatshops associated with them?