CONTEMPORARY ISSUES IN CONSUMER RESEARCH

MSc. MARKETING

TOPIC – Ethical Consumerism & Marketing Opportunities

TUTORS – Dr. Effi Raftapoulou & Dr. Morven McEacher

STUDENT ID - @00478856
Introduction:
In an age of information, the ethical consideration set that is found in the
consumer decision making process is posing a challenge for the marketing
companies around the world. The rise digital media especially social media has
increased the level of brand awareness that is affecting the consumers preferences
and choices (Doane, 2001). While marketing firms are resorting to honest branding,
and underpin their advertising communication with a set of value that evokes ethical
awareness and sympathy in the consumers, the whole process of ethical
consumption however is based on consumer perception and patronage factors. In
this essay, we try to take real life examples and discuss how the ethical
consumerism is affecting the marketing opportunities.

Variety of ethical concerns and its growth.

Over the last two decades, the concern about the ethics are increasing among
the consumer as well as in the organisation, as the consumer brings profit to the
organisation, it expects honest and fair practice from the organisation towards the
society (Hamelin, Harcar & Benhari, 2013). The millennium consumer’s approach to
narrow down the choices as the credibility of the product in highlighting the ethical
benefits have now taken prime position. Thus, the labelling of the product attributes
and positioning along with the advertising cues is important to shape the perception
of the customers. The issue of the consumer choosing one above the other refers to
the buying motive of a particular brand and in a free market where choices are there,
it marks the competitiveness of the normal and ethical products. Over the years the
concern of the consumer has extended to other issues like animal welfare, fair trade,
human rights, fair wages paid to the workers. The branding strategy therefore in
many products and services has undergone a considerable change in order to clarify
their role and position regarding the ethical factors. On the other side, Natural
resources are depleting due to its excessive consumption causing large amount of
wastage, it has been argued that the most effective solution for to reduce
environment degradation is to reduce the level of consumption, resulting in less use
of resources. Even though the significance of waste disposal, recycle, reuse and
green production did not help in preserving the natural resources (Souza, Taghian &
Polonsky, 2011). Ethical concern can be reflected in consumption of food and
production of goods, which include source of raw material, raw material used, labour,
effect on environment and government policy and the labelling (Charter & Polonsky,
1999). According to the consumers ethical behaviour, consumers have been divided
into five categories, at the top is the basic brown, who do not wish to make any
changes while at the bottom lies the true-blue green who are actively green
consumers and can be seen at various environmental moment (Sethna & Blythe,
2016)

The awareness has gained to reach a momentum where the use of

descriptive research shows that most of the research focus on the customer
preferences, attitudes. The ethical augmentation theory relates to the act of the
customers to turn away from those products which are unethical and rather not
conduct themselves unethically. The other side of consumerism and marketing is the
concerns of consumers pointing to the anti-exploitation of the business practices.
Thompson and Coskuner-Balli (2007) argued that the increased level of customer
consciousness regarding the differential treatment of the farmers and marketing
firms has led to creation of FairTrade practices. The case of Ghana cocoa plantation
workers getting their dues as multinational companies are outsourcing their farm
products has been a brighter side of ethical marketing (Bird and Hughes, 1997). On
the other side, shoe company like Nike has been caught in Thailand for violating the
protocol of engaging below the legal age workers in sweat shops that has led to
stringent penalty and tarnished brand image (Nisen, 2017). Thus, the breadth of the
consumer understanding the ethical side of product and services has grown which
has led to changes in portfolio.

The growth of this trend can be seen increasing due to the consumption of
food produce from the local retailers as research recognised that local consumption
has helped in lowering exploitation of employees and suppliers and use of chemical
free food (McEachern & Carrigan, 2014). Information plays a vital role related to
ethical consumption. Better knowledge helps the consumer choosing the appropriate
alternative of their desired product, supporting the ethical retailers (Souza, Taghian &
Polonsky, 2011). The issue is more relevant when the brand is an edible product and
the legal control, in trade mechanisms is the other facet which the marketers and
retailers need to focus. The horse meat scandal in Tesco supermarket chain in UK
showed the lapses in quality inspection in food across borders (Horsemeat scandal:
Tesco, 2017, Lawrence, 2017), due to this the consumers whose health was at risk
rejected the frozen meat section for over a year, which shows the demand side is
likely to react fast when unethical practices are abound in food that affects consumer
health. The otherside side McDonalds offering salads to its calorie high burgers that
is impacting the consumer base health. It has been able to shift the consumer focus
of obesity and cholesterol to be compensated with lemonades, salads shifting to
healthier choices of food (Lenzo, 2017)

Factors that affect these choices

The marketing logic needs to align the product attributes to that of the
consumption desires based on ethical lines. This is likely to help the consumers to
take decision based on the theory of planned behaviour while making the final
consumption choices (Shaw et al. 2000; Cho and Krasser, 2011). However, in
marketing these, the reliable ‘validation process’ is a critical element that helps to
attract the target segment to the product and services usage. It is therefore
advertised in highlighting the universal morals that govern our belief system as there
is wide range of gap in the consumer’s attitude, intentions and purchase intentions of
ethical product (Szmigin et al. 2009). The role of powerful brand has failed in the
past when ethical flaws are out in the open. This proves the point of the capitalist
tendencies of consumerism which can be labelled as destructive as it is leading to
creating groups and sub groups of ethical consumers. Newholm and Shaw (2007)
added that creating opportunities to improve the marketing and ethical domain
linking the product/service based moral values need to be displayed in the form of
quality, convenience, price and lastly the brand repositioned to attract prestige value.
Though there is marketing environment which plays a big role, the social surrounding
and physical surrounding, the consumer’s state of mind, type of product or service,
purchase intention that leads to the cognitive modelling (Cho and Krasser, 2011).
Szmigin et al. (2007). concluded that rationalisation helps to consumer to decide,
bypass those unethical products which otherwise would have given feelings of guilt.
Firms like IKEA have shown exemplary vison and commitment to honour throughout
the decades. It also supports the tenant of ‘consumer is king’ and the ethical
magnifying glass forces the individual functions of the company to contribute to the
aggregate sum of ethical product. Changes in the policies at the institutional level as
mentioned earlier at national or international level also forces the company to
change the stand point. It puts to the end of selfish motive as cited by Keynes that
profit for personal advantage leads to greatest good to the masses is rest when the
end users are aware of the ethical reality in the consumerism (Chatzidakis and
Mitussis, 2007). The shock to the economic system of existing production hence
requires a redefined approach and philosophy to contradict the existing practices
and adopt best practices that are ethical marketing oriented.
There are pressures to conform in societal relationships, and it forces the
consumers, to succumb to socio emotional values (Carrington et al. 2015). The
psychology of consumers opting for counterfeits show economic value superseding
their decision making and consciousness. This attitude to support unethical product
as against the theory explained above is to break the rules, social pressure to
perform acts that improves personal style and image, helps in expressing their
ideology and self-identity. Here the ethical judgment of the consumer falters as the
belief system, self-perception is very different. For example, a person thinks to buy a
product which is cheap and under budget, but on the other side he might think that
the product might me cheap due to unfair trade practices. The aspect of social
responsibility when added to nullify the proprietor’s self-interest makes the approach
more holistic though economic sense, it challenges the profit motive strongly
(McEachern & Carrigan, 2014, Chatzidakis and Mitussis, 2007). Increasingly the
companies are therefore focussing on the origin of products, trade related issues,
fortifying their intellectual property rights as a part of WTO (world trade organisation)
that bears the authenticity approval (Hussain, 2012). Thus, throughout the entire
value chain all the functions that are contributing to the product origin, processing
and till it reaches the end user has undergone changes to meet the consumer
conscious levels. Shaw et al. (2005) stated that to reach and address consumer
ethical concerns, it needs a behavioural approach to the economics, which
contradicts that whatever is best for the society means sacrificing profits. This level
of consumerism therefore needs a market change, where the sustainability of the
brand is dependent on the honest acknowledgement of what it stands for (Harrison
et al. 2005). Though the argument is that consumers are unlikely to reward the brand
for being honest, which can be translated to loyalty or repeat purchases but to think
of a long-term solution regulation at legal side can be a credible move.
 The challenge however is that morals differ as per age, socio economic
status, culture, country (Cho and Krasser, 2011). The choice of one individual to
support and buy illicit trade, or buy counterfeit luxury product may not be accepted in
a collectivist society (Bedford, 1999). Thus, engaging in piracy or counterfeit trade in
Islamic nations is banned and it is not found in middle east, with consumers
expressing unwillingness to buy anything which is not genuine.

The future of the products and services is likely to see regulations which are
flowing into the trade for both products and services with the consumers driving the
change. Though there is no measurement of scale for the social ethical practices or
consumer ethical sentiment, but the reference of the CSR (corporate social
responsibility) can play a big part in future. This has mostly concentrated on the
pollution and waste, as it forces the marketing function to play a bigger role in
responding to the rising facets of consumer ethical standpoint. There has been
already a host of regulations like SA8000, Organic trade association, Vegan,
recycled/recyclable, Rainforest Alliance certified, FSC certified (wood) that has
emerged in different product categories (Harper and Makatouni, 2002). Even in the
services sector, hospitality sector has opened up to ecotourism, ecotels which are
concerned about customer’s concerns regarding environment protection and
preservation (Goodwin and Francis, 2003).

Marketing opportunities
Carrington et al. (2014) stated that currently there is the morality gap that
exists in the consumer and product, can be bridged. This need to be done on an
urgent footing, as it is an opportunity for the marketing firms to reposition the
products and services that has no orientation of ethical angle in it. The challenge
however is more, as consumers perception about ethical dimension is unlikely to be
based on just one issue but two or more. This is likely to be affect, the ethical
attitudes of the consumers and the marketing firm need to set aside the ethical
considerations in every stage of production (Szmigin et al. 2007), The ability to
develop the capability of showcasing the employee and management contribution in
channelizing the alternate production strategies, setting standards of compliance is
the right step to address the ethical consideration set that lies in the buying
behaviour. The aspect of generating social desirability that tests the customer’s liking
to the ethical purchase can be closely linked to corporate level strategy using CSR
approach (Devinney et al. 2006). Projecting the ethical angle as an obligation, helps
to reposition the existing product, thereby creating opportunities to tap the growing
conscious consumers. The consumption intention with the new positioning also need
to be tested as the consumers self-identity and the perceived ethical positioning
need to match that is likely to drive the product offtake. (Cho and Krasser, 2011 :
Szmigin et al. 2007).
However, the repositioned product or the brand and shift towards ethical
standpoint should be marked visibly, as it is the core issue of the whole
transformation process towards ethical positioning. The consumer sovereignty rules
there as every customer has the right to demand a product that creates welfare for
workers producing it, consuming lesser energy, using recyclable processes and that
is forcing the companies to shift gears (Carrigan and Attalla, 2001). The companies
therefore need to find out the ethical gaps in every process, stage, part of the end to
end procurement, production and distribution process. This stance shows how the
power of ethical consumerism that is class leading and affecting incremental
changes in each function in a company. The level of ethical consumerism can be
increased with stringent measures taken for industries in the following areas:
environment, people, animals, politics, product sustainability. There can be a global
agency which can drive nation wise, ethical concern creating index for each
industrial sector, company. The collection of data over a period of time will allow to
understand the range of issues and share the best practices over the ethical
network. It can also give rise to ethical environmental reporting standards which is
carried out in nuclear power, waste toxins levels measurement. (Souza, Taghian &
Polonsky, 2011). The inclusivity of employee contribution in the work area, with fresh
ideas, creativity and innovation is bound to change each function and align ethical
angle towards redesigning the product portfolio. The aspect of control at top
management supporting the belief, through corporate governance and as a practice
is essential in order to roll out the change in ethical practices within a firm
(Schroeder, 2002). This would ideally reflect in the ethical brands as companies
increasingly adopt practices to make the process aligned starting from the
purchasing to selling (end to end) process.
Conclusion
Today business ethics is considered as the new definition of consumerism,
the consumers of today are rational human beings who are willing to forego
consumption in order to support a good cause which is affecting the marketing
function around the world. In this essay the many facets of consumerism, the
manufacturers side, the consumer as an individual, ethical dimensions have been
explored which explores the power of change which is driven by consumer and
regulations, which in fact is forcing the firms to adopt practices which are shunning
the profit motive. The sustainability in business is more profitable when the products
and services intended do not harm environment, people (consumer and employees)
and animals,
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