Social Responsibility, Consumerism, and the Marketing Concept

Topics: Economics

SOCIAL RESPONSIBILITY, CONSUMERISM, AND THE MARKETING CONCEPT Robert D. Winsor, Loyola Marymount University ABSTRACT This paper compares the often-criticized “selling orientation” or “selling concept” with the commonly-praised “societal marketing concept “from the perspectives of consumer rationality and persuasibility. It is suggested that both orientations view consumers as relatively irrational and as easily prone to manipulation by marketers. The implications of this similarity are explored from the perspectives of consumerism and social responsibility. INTRODUCTION

Critics of marketing have consistently attacked the discipline for discounting consumers’ intelligence and capacity for rational choice and for deliberately confounding consumers in their efforts to make rational, informed, unbiased, and free economic choices.

At the same time, societal trends have pushed U. S. businesses in the direction of increasing concern for social issues and attention to long-run consumer welfare. The aforementioned criticisms and pressures for increasing social responsibility are largely driven by the same social paradigms and constituents.

Yet, it is noteworthy that the ultimate result of an expanded social responsibility of business is the concomitant diminishment of free consumer choice.

Moreover, this obstruction of consumer discretion is the inevitable consequence of presumptions of consumer irrationality. Thus, while groups such as consumerists have often criticized marketers explicitly for rejecting notions of consumer rationality, these same groups and sentiments have forcefully promoted the social responsibility of business and the societal marketing concept as advancements in business thought and practice.

As a result, contradictions can be seen to exist within the consumerist agenda, and are apparent (but unacknowledged) in the “societal marketing concept” and calls for increasing the responsibility of business toward social issues and concerns.

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The goal of this paper is to expose these contradictions and to elaborate upon their implications for business and society in general. THE EVOLUTION OF THE MARKETING CONCEPT In January of 1960, the marketing discipline entered a new age.

In this year, we were presented with no ground-breaking theory, no pioneering methodology, no brilliant adaptation of another discipline’s construct, and no monumental grant. We were, however, given something we would come to treasure much more highly than any of these. We were provided a raison d’etre and a philosophical foundation. It was on this date that the Journal of Marketing published an article by Robert Keith (1960) entitled “The Marketing Revolution. And, since its publication, marketers have been able to feel justified in believing that their efforts were not only indispensable, but that they have been instrumental in bringing about sweeping improvements in the evolution of business practice. Although the revolution described by Keith has been tamed to become the “evolution” of the marketing concept, and the generalizablity of the evolution it described has been questioned by some (e. g. Fullerton, 1988), the transformation in American business described by Keith’s model has nonetheless served as a source of explanation and justification for marketing academicians.

The “post-evolution” marketers have been lent a degree of dignity and a sense of purpose which was conspicuously lacking before. Prior to this date, marketers were perceived to be at best superfluous, and at worst dishonest or unscrupulous. Not that the average citizen considers marketing in any different light today, but the belief in an evolution of the marketing concept has allowed the academic marketing community a certain degree of self-respect. In his article, Keith described four “eras” or periods of thought and practice through which his organization, The Pillsbury Company, progressed.

Keith believed that these eras were characteristic of most businesses which were contemporaries of Pillsbury, and thus speculated that an overall movement was in evidence. Since the publication of Keith’s article, other writers have modified, refined, and extended the basic thesis advancing this evolutionary process: The most noteworthy and well-known of these descriptions is that of Philip Kotler. Kotler describes five alternative concepts or philosophies through which most businesses have evolved.

Although any given business can operate under any of the philosophies, the underlying precept of the evolution thesis is that these philosophies form a hierarchy, with later philosophies being superior to those of earlier eras (Keith, 1960; Kotler, 1994). The implication is that to move from a lower level (earlier) philosophy to that on a higher level (later) is not only insightful, but also good business. The first eras or business philosophies are termed the “product” and the “production” concepts.

The product concept emphasizes product quality and/or performance, and assumes that at least some consumers are knowledgeable enough to recognize and respect superior attributes in these areas. The production concept focuses upon systems for producing large volumes of products in an effort to drive down costs by exploiting economies of scale. This philosophy is based upon the assumption that most consumers not only recognize, but prefer high value (benefits – price) offerings and are knowledgeable and rational in selecting among alternative products.

A later era is known as the selling concept, and is based upon the premise that consumers are relatively uninformed regarding product attributes, or base their selection upon fashion or other “non-rational” criteria. Moreover, this orientation assumes that consumers are easily influenced. As a result, organizations employing the selling concept typically resort to aggressive selling and promotional efforts, with the goal of seducing or coercing customers into purchasing the product. A considerably higher plane of enlightenment is represented by the marketing concept era.

The marketing concept is considered to be a quantum leap up the evolutionary hierarchy, and continues to be embraced by a great number of marketing scholars and businesses. The marketing concept “holds that the key to achieving organizational goals consists in determining the needs and wants of target markets and delivering the desired satisfactions more effectively and efficiently than competitors” (Kotler, 1994, p. 18; 1977a). The motto of the marketing concept is “find a need and fill it,” and its credo is “The Customer is King. Like the product and production concepts, but unlike the selling concept, the marketing concept is founded upon the assumption that consumers are knowledgeable, intelligent, and rational, and base their product purchases upon a careful consideration of the relationship between their own needs and product attributes. As a result, the fundamental premise of the marketing concept becomes a focus on the consumer as the pivotal point for all business activity (Barksdale and Darden, 1971).

The thinking underlying the marketing concept was espoused as early as the 1940’s and 1950’s (Samli, Palda, and Barker, 1987; Bell and Emory, 1971). In 1958 the term “marketing concept” was coined to describe the philosophy behind this approach (see McKitterick, 1958), and “by 1965 practically all introductory marketing texts included some discussion of the ‘new’ marketing concept” (Bell & Emory, 197 1). The reason that the marketing concept was considered a major breakthrough in business philosophy is that it represented the antithesis of the product, production, and selling concepts.

Rather than taking an existing product and endeavoring to modify demand for it by adding features, reducing price, or varying promotional technique, the marketing concept holds that businesses should first determine the existing needs in the marketplace and then design and produce a product to satisfy this need. In this sense the marketing concept is driven by the needs of the marketplace, rather than the existing abilities of the firm.

The fifth, and supposedly highest stage of evolution in marketing philosophies is what Kotler terms the societal marketing concept. In each of his writings referencing the marketing concept, Kotler (1972, 1977b, 1994) clearly states his belief that the societal marketing concept embodies a higher and more enlightened plane of marketing thought and practice, and suggests that this new concept represents an attempt to harmonize the goals of business to the occasionally conflicting goals of society.

As such, it postulates that the “the organization’s task is to determine the needs, wants, and interests of target markets and to deliver the desired satisfactions more effectively and efficiently than competitors in a way that preserves or enhances the consumer’s and society’s well-being (Kotler, 1994, p. 29). It should be noted that the societal marketing concept is founded upon one dominant and critical proposition.

This is the assumption that “consumers’ wants do not always coincide with their long-run interests or society’s long-run interests,” and that, given this, marketers should place the “emphasis on ‘long-run consumer and societal well being” (Kotler, 1977b). As a result, the societal marketing concept represents an endorsement and justification for the social responsibility of business in contemporary society, and a refutation of Milton Friedman’s infamous assertion that “the social responsibility of business is to make a profit” (Friedman, 1962). THE CONSUMERISM MOVEMENT AS THE CATALYST FOR THE

SOCIETAL MARKETING CONCEPT The latest consumerism movement is a cause that has been accumulating momentum for over 30 years in the U. S. , and its disciples assert that all consumers have an inherent right to products which are: safe in use (and even misuse), effective for the use designed, economical, reliable, honestly labeled and advertised, and benign in their impacts upon the environment. Moreover, consumerists have been very proactive in seeing that these “rights” are guaranteed to individual consumers, either by the firms selling the products, or by the government of this country.

Adherents of consumerism tend to believe that businesses are so overwhelmingly motivated by the desire to make a profit that they commonly compromise the quality of the product offerings, thereby jeopardizing the safety of consumers. Consumerists cite examples of this “greed,” such as the Beech-Nut case involving the sale over 10 years of millions of cases of “apple juice” which was in reality only sweetened, flavored water (Business Week, 1988).

The fact that such a large number and variety of these cases exist and continue to be exposed on a regular basis lends a great deal of credibility to the consumerism movement and its underlying assumptions. In explaining the rise of consumerism, Peter Drucker blamed the marketers for failing their consumers and publics in using the marketing concept: We have asked ourselves where in the marketing concept consumerism fits or belongs. I have come to the conclusion that, so far, the only way one can really define it within the total marketing concept is as the shame of the total marketing concept.

It is essentially a mark of failure of the concept… (Drucker, 1969) This quote is now famous to marketing practitioners, scholars, and critics alike, and the legitimacy of Drucker’s view is generally conceded. In the same year that Drucker made this accusation, Business Week (1969) also asserted that “In the very broadest sense, consumerism can be defined as the bankruptcy of what the business schools have been calling the ‘marketing concept. “‘ These condemnations of the marketing concept reflected a general assumption within both the business and academic spheres regarding the implications of consumerism’s growing popularity.

A substantial portion of scholars and managers surveyed in 1971, for example, believed that the rise in consumerism was a direct reflection of the inadequacy of the marketing concept (Barksdale and Darden, 1971). As the presumed response to the failure of the marketing concept, then, the consumerist movement became the foundation for “a revised marketing concept” which Kotler (1972) proposed as the successor to the “failed” marketing concept. As in earlier stages of the marketing philosophy evolution, the “societal marketing concept” was ostensibly constructed upon the ruins of its immediate predecessor.

Since the most recent consumerist movement in the U. S. served as the catalyst for today’s conceptualization and implementation of the societal marketing concept, it would seem important to understand the modern origins of this movement. ORIGINS OF THE MODERN CONSUMERISM MOVEMENT Writing in 1987, the Auto Editors of Consumer Guide described one car as “perhaps the most sophisticated (certainly one of the most ambitious) cars ever to come from Detroit” (Langworth and Robson, 1987, p. 51). These authors went on to proclaim that these were “the kind of cars we should have had in the 1970’s, and didn’t. The car was the Chevrolet Corvair of the 1960’s, and its conspicuous absence in the 1970’s was the direct result of what many consider to be both consumerism’s explosive postwar debut and also its finest hour. Indeed, the tomb of the Corvair became the foundation of consumerism as we know it today. While business historian’s (e. g. , Halberstam, 1986) are eager to criticize Detroit’s apparent indifference and ineptitude regarding the 1970’s invasion of small, economical automobiles from foreign countries and the oil crisis which precipitated this invasion, this blame has been clearly misplaced and undeserved.

In 1959, General Motors, acknowledging an existing need in the marketplace for a small, inexpensive, sporty, and fuel-efficient automobile, designed and marketed a vehicle to fill this need. This automobile, the Corvair, was indeed revolutionary in many respects, having four-wheel independent suspension, a rear-mounted air-cooled six-cylinder engine, the option of turbo-charging (a first), and an exhaust system design which would be used on a majority of automobiles for years to come.

Both the Corvair and its functional, but considerably more primitive predecessor, the Volkswagen Beetle, were designed, built, and marketed with the highest regard for the marketing concept–offering lower-income consumers the opportunity to own an economical, reliable, and fun-todrive automobile. Both cars were strong sellers, and appeared to satisfy a number of preexisting needs in the marketplace. In 1960, Consumer Reports praised the Volkswagen for its good workmanship, and handling and roadability which were “well ahead of the U.

S. average”. Additionally, about the worst thing that Consumer Reports could find to say about the Corvair was a remark about its “unimpressive trim quality” (cf. Abernathy, Clark, and Kantrow, 1983). Unfortunately for many consumers, Ralph Nader would use these cars as a catapult for his career, and in so doing, would become synonymous with the consumerism movement. In 1965 he wrote a book entitled Unsafe at Any Speed, in which he criticized General Motors as being irresponsible, greedy, and unconcerned for the public’s safety.

Nader used the Corvair as the book’s primary example, developing an elaborate, scathing, but also relatively misplaced criticism of the Corvair. Due to the negative publicity which the book generated, the book dealt a death blow to the Corvair, which immediately began a downward sales spiral toward its eventual extinction in 1969. Inspired by the “success” of Unsafe at Any Speed, an equivalently brutal and faulty criticism of the Volkswagen Beetle was written in 1971 by a colleague and ally of Nader, and was entitled Small—On Safety (Dodge, 197 1).

Since, by the time of this book’s publication, millions of Volkswagens were on the road and were well-regarded as providing reliable, economical, and serviceable transportation, the book failed to achieve any credibility, and did little harm to Volkswagen’s sales. What should have been evident to readers of either book and to consumers in general, but was perhaps not appreciated until much later, was that it was physically impossible to construct a small economy car which was as safe as the leviathan Cadillacs, Lincolns, and Chryslers of the same period.

Had a well-designed car such as the Honda Civic (or any other contemporary compact automobile) been introduced into the market in the 1960’s, it too would have certainly been labeled as unsafe, and forced off the market. THE SOCIETAL MARKETING CONCEPT AND THEORY X The societal marketing concept is largely congruent with the “multiple constituency model of organizations” (Kimery and Rinehart, 1998), and general notions of the responsibility or obligation of businesses to social and environmental stakeholders.

Contrasted to the marketing concept or orientation, which posits the direct and simple relationship between organizational profitability and responsiveness to customer needs and concerns, the societal marketing concept or multiple constituency model suggests that success is highly dependent upon an organization’s attentiveness to all constituencies simultaneously (Kimery and Rinehart, 1998). Yet due to the common opposition between immediate consumer needs and long-term societal and individual needs, the simultaneous “satisfaction” of all of these demands is frequently difficult if not impossible.

Moreover, the focus upon “un-stated” or long-term customer needs and a concomitant discounting of stated consumer desires have distinct overtones of corporate or governmental paternalism and the assumptions of producer or governmental sovereignty, which this perspective necessarily implies. In short, where the marketing concept is the economic equivalent of the democratic process, the societal marketing concept is antithetical to the tenets of democratic equality and more comparable to economic fascism.

In an eloquent paper outlining the conceptual foundations of his societal marketing concept, Kotler adapted Douglas McGregor’s managerial “Theory X / Theory Y” to illustrate alternative perspectives of customers (Kotler, 1977b). According to McGregor, Theory X managers view their employees as being lazy, ignorant, gullible, suspicious, and disloyal. In contrast, Theory Y managers view their employees as informed, intelligent, motivated, unique, and rational (McGregor, 1957, 1985).

In his adaptation, Kotler makes the assertion that businesses subscribing to the philosophy embodied within the societal marketing concept make assumptions about their customers which are consistent with Theory Y (as opposed to Theory X). In other words, Kotler believes that the societal marketing concept is philosophically consonant with a perspective of the consumer as informed, intelligent, and rational, suggesting the higher plane of enlightenment shared by adopters of this concept and alluding to the concept’s supposed capacity for consumer empowerment.

Although Kotler makes a valuable contribution in adapting this managerial framework to the marketing discipline, he grossly errs in his interpretation. A far more plausible observation is that the societal marketing concept is solidly built upon Theory X assumptions about consumers on the part of the marketer. According to Kotler (1977b), “societal marketers are more attuned to the buyers’ unexpressed needs than overexpressed wants,” and place an emphasis upon “long-run consumer and societal well being. Because of this, the societal marketing concept clearly forces or compels marketers to make judgments about what is “best” for consumers, and what needs are valid (as opposed to those that are spurious or unwholesome). It is in this way that the societal marketing concept becomes the ultimate subscriber and underwriter to the Theory X mentality. The conceptual foundation of the societal marketing concept (as well as of the consumerism movement) rests eavily upon the belief that the individual consumer is unable to “look out for him/herself,” is gullible, ignorant, easily misled, does not know what is actually in his/her own best interest, and thus needs to be protected from powerful and unscrupulous marketers. In this way, the belief that the role of the marketer is to interpret what is “best” for society and individuals necessitates the assumption that individuals do not and cannot know what is best for themselves. Nor is this an overstatement of the societal marketing concept’s goals and assumptions.

Bell and Emory (1971, p. 40), proponents of this concept, assert that “The typical consumer is at such a disadvantage that he cannot assure his own effectiveness. Business has the responsibility to help him, and if business fails then the government or other parties must act on the consumer’s behalf. ” In addition, in circumstances “where the buyer is unwilling or unable to make rational decisions,” Bell and Emory believe that “It is the duty of business to promote proper consumption values” (Bell & Emory, 197 1, p. 40, emphasis added).

Yet these are precisely the “paternalistic” attitudes which characterize the Theory X “manager” according to McGregor. The fact that some consumers may choose to buy a subcompact automobile because they prefer economy over a certain degree of safety, or that some choose to subsist on McDonald’s hamburgers, fries and milkshakes despite their “unhealthfullness” does not imply that these individuals are stupid, or gullible, or that they need to be “enlightened” by consumerism or societal marketing techniques, This is in fact the precise point at which the “evolution” of the marketing concept breaks down.

The marketing concept holds that marketers should strive to supply products for every consumer need, provided these needs are not grossly threatening to society, and that “any decision the customer makes to serve his own perceived selfinterest is rational” (Bauer & Greyser, 1967). It is thus impossible to interpret the societal marketing concept as anything but a move backward into the period where the selling concept ruled–where consumers were “ignorant,” “irrational,” and easily anipulated by more insightful marketers. CONCLUSIONS AND IMPLICATIONS While consumerists and other critics of the selling concept regularly and loudly chastise business organizations for employing marketing strategies and campaigns which are ostensibly based upon assumptions of consumer ignorance and irrationality, these same guardians of consumer interest are typically synonymous with those pushing organizations most forcefully into programs of social responsibility and the societal marketing concept.

Yet, as noted above, the agenda of social responsibility in business is clearly based upon assumptions of equal (or even greater) degrees of consumer ignorance and irrationality. Disciples of the societal marketing concept appear to be largely oblivious to the relatively absurd levels that businesses have been pushed by forces in concert with their agenda. (Witness the warning on McDonald’s coffee cups: “Caution: HOT! . . . CAUTION: CONTENTS HOT! … Caution: HOT! . . . Caution: HOT! . . . WARNING: HOT! … /! .. ” which are combined with a corollary reduction in the temperature of the liquid itself — actions which were necessitated by the infamous multimillion dollar legal claim against the company — a lawsuit which was applauded by numerous consumerist groups. ) But, as Levitt noted in 1958, “self-conscious dedication to social responsibility may have started as a purely defensive maneuver against strident attacks on big corporations and on the moral efficacy of the profit system. But defense alone no longer explains the motive. The motive for corporate social responsibility and the overwhelming push for social responsibility in the pursuit of sales now arises out of the industrial sector’s near-total dependence on social trends and the sentiment of a minority of consumers. Corporations that have been beaten into submission by frivolous lawsuits and that are afraid to arouse consumerist accusations of indifference have been forced to pander to the lowest common denominator of consumer passivity, ignorance, and laziness.

As predicted by McGregor, these Theory X attitudes and actions have subsequently bred and reinforced the very passivity, ignorance, and laziness in consumers they were designed to anticipate and amend. Ironically, the similarities between the selling concept and the societal marketing concept regarding their shared assumption of consumer ignorance can be seen as forming the perfect foundation for either societal altruism or, alternatively, opportunistic exploitation.

In many cases, these efforts can be difficult to distinguish from one another, and apparent acts of altruism or social responsibility can provide the perfect camouflage for exploitation. Because organizations are rapidly becoming aware of the power of “greenconsumers,” for example, there is a significant temptation to advance this agenda through the marketing program as a powerful device for cultivating customer loyalty and anesthetizing consumer prudence and vigilance.

As Kotler (1994, p. 30) notes, “a number of companies have achieved notable sales and profit gains through adopting and practicing the societal marketing concept. ” One of the two shining examples Kotler cites is The Body Shop, started by Anita Roddick in 1976. This organization has experienced phenomenal sales growth by actively promoting its products as all-natural, environmentally friendly, and non-animal-tested, and its business practices as sociallyconcerned.

Moreover, Roddick has frequently and publicly ridiculed other cosmetics companies, noting that they are “run by men who create needs that don’t exist” (Zinn, 1991). Indeed, The Body Shop became in the 1980’s the prototype that all “earth-friendly” businesses would seek to emulate. As the vanguard of social responsibility, The Body Shop and its founder became the beneficiary of huge volumes of positive publicity, international acclaim, and consumer goodwill.

Yet recent explorations into The Body Shop’s products and business practices have found elements which yield a stark contrast to the public images and perceptions noted above. Products of the company have been found to be largely petrochemical-based and of relatively poor-quality, and a large proportion of them have been tested on animals. In addition, the “socially-enlightened” business practices of this company have been exposed as creative public relations efforts, and the FTC has nvestigated the firm for fraudulent business dealings (Entine, 1993; Buszka, 1997). Clearly, it must inevitably be those organizations which are encouraged to view their consumers as ignorant or irrational that can and will most easily extend that notion to discover opportunities for exploiting that ignorance and irrationality. It is for this reason that those espousing the societal marketing concept and the social responsibility of business can be seen as the greatest danger to consumer sovereignty and consumer welfare.

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Social Responsibility, Consumerism, and the Marketing Concept
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