Ethical Dilemmas in Marketing Research

Although ethical difficulties in marketing have previously been addressed, the expanding scope of consumer research necessitates a re-examination of ethical questions. By broadening the scope of consumer research to encompass social issues and employing qualitative research methods, researchers are becoming more physically and emotionally close to their respondents.

 

You, as a conscientious consumer researcher, have heeded the call for socially responsible consumer research and are investigating people who overspend. You have, of course, ensured the secrecy of all information exchanged during the interview process by scrupulously looking out for your respondents' best interests. During an interview, one respondent casually admits that when he is frustrated with his spending habits and debt, he frequently "cuts loose" and physically abuses his child. You're in the awkward and potentially unlawful situation of knowing more than you want to know. You are required by law to report child abuse; but, you have offered your respondent secrecy in exchange for his readiness to reveal sensitive information.

 

Introduction to Marketing Research 

 

Marketing research is defined as any technique or set of practises used by businesses to acquire information in order to better understand their target market. Companies use this data to improve their products, improve their user experience, and provide a better product to their customers. Marketing research is performed to find out what people desire and how they react to items or features.

 

Market research is the process of determining the viability of a new service or product through direct research with potential customers. It enables a corporation to identify its target market and obtain consumer comments and other input about their interest in a product or service.

 

The research might be done in-house or by a third-party market research firm. Surveys and focus groups, among other methods, can be used. For their time, test subjects are frequently provided with product samples or a small stipend.

 

Market research is performed to examine the potential of a new product or service. The findings could be utilized to alter the product design and fine-tune the approach for exposing it to the market. This can include information obtained for the aim of calculating market segmentation. It also informs product distinction, which is used to adapt advertising. The market research services industry is fast expanding, indicating a significant interest in market research as we approach 2023. The market is predicted to increase at a compound annual growth rate of 5% from around $75 billion in 2021 to $90.79 billion in 2025.

 

Why is it needed?

 

Market research assists you in identifying your most serious risks. It also provides you with a clear picture of potential for improved returns on your business investments, or ROI.

 

Understanding your specific market on multiple levels and from various viewpoints allows you to make well-informed, data-driven decisions. There may be several stages to the process. However, if you take a systematic approach and use a market research template, your efforts will be rewarded.

 

Market research enables you to meet your buyer where he or she is. This is becoming increasingly valuable as our world (both digital and analogue) becomes noisier and demands more and more of our attention. You may construct your product or service to organically appeal to your buyer by understanding their challenges, pain points, and desired answers. When you're ready to extend your organization, market research can also assist you build a market expansion strategy.

 

Now that we've defined market research and the various types of it, it's time to learn why it's important and why you should invest in it if you want to be a successful entrepreneur. 

 

1. Determine the Problem Areas 

 

Knowing what you are and are not excellent at allows you to take lucrative risks in life. It is also true in business. Accurate market research assists you in identifying business sectors that are operating well, those that require additional attention, and those that you might consider abandoning. In 2010, two young computer enthusiasts founded Burbn, a location-based app that allows users to check-in, organise hangouts with friends, share photos, and more. They realized a few weeks after the launch, through internal conversations and reevaluation of the market, that Burbn is cluttered and their target market is more into Foursquare, and they won't be able to sway them.

 

2. Recognise Your Customers' Requirements

 

It is not enough to understand your business; you must also understand what your consumers are saying about you - and your competitors. If you know what your customers are thinking, you will build products that solve their problems, reach out to them when they are most open to listening, and help them become your dedicated ambassadors.

 

A significant portion of commercial market research is always devoted to determining consumer satisfaction levels, reactions to new products, and what they are searching for next. 

 

3. Based on informed decisions, conduct your marketing.

 

Starting and sustaining a business requires daily decisions on products, services, growth, HR, and so much more. Without solid market research to back up your decisions, you're just winging it and hope for the best.

 

With research assisting your business, you are more educated about areas to invest in, gauging the potential success of new goods, testing new markets to grow into, and determining what types of products/services will be most popular with your clients.

 

This is unquestionably what Starbucks does. The corporation has a dedicated site called 'My Starbucks Idea,' where employees, customers, and anybody else interested can weigh in and submit their ideas for what the company should do next.

 

4. It allows you to keep an eye on your competitors.

 

As a company creator, you may believe that being unique entails focusing on what you're doing and not worrying about what others are doing. This strategy will lead to long-term devastation. While you should focus on your own efforts, it is vital - and prudent - to maintain tabs on your competitors and know what they are thinking or doing. With solid market research on your side, you can better plan for what your opponent may do next and ensure they don't eat into your market share. 

 

5. Allows you to grow and innovate

 

Market research can assist you in identifying markets and geographical locations into which you can expand. It can also assist you in investing in concepts that have the greatest chance of success based on what customers want and what the market lacks.

 

For example, if you own a retail business, conducting market research can help you find places where you can make the most money. If you want to buy a business to enhance your market share, market research can help you identify companies that are ripe for acquisition. Furthermore, completing market research prior to launching your firm might assist you in determining how to put your best foot forward.

 

Also Read | 8 Strategies of Customer Retention Marketing

 

Ethical Issues in Marketing Research 

 

Ethical marketing is the practice of selling items or services not just for the advantage of the client, but also for the benefit of social and environmental concerns. Its goal is to build long-term customer-brand partnerships based on shared values and goals.

 

An ethical dilemma (also known as an ethical paradox or moral dilemma) is an issue in the decision-making process when there are two viable solutions, neither of which is completely acceptable from an ethical standpoint. Although we face many ethical and moral dilemmas in our daily lives, the majority of them have simple solutions.

 

1. Selling a product as opposed to selling a solution.

 

Many marketers have been tasked with selling things that were conceived and/or manufactured with a certain target market in mind, but in order to increase sales, those products are subsequently promoted to an audience that does not desire or need that product. Many marketers "push product" rather than develop valuable solutions, rather than take the time to properly understand the demands and conditions of the new market. This leads to dissatisfied clients, who, in today's world of social media complaining, wind up harming the brand by publicizing their unpleasant experiences with the products they were sold.

 

2. False Promises

 

They push products into different marketplaces without sufficient research in order to sell more and generate more income. 

 

They're aiming to find a willing market by reaching out to as many people as possible. This is a wasteful strategy that could stymie your growth and ruin your reputation. Products are not the same as solutions. Concentrate on the solution rather than the sell. 

 

3. Making Assumptions and Making Guesses

 

We discussed the dangers of blanket selling to uninterested markets. Making assumptions about a target market might be equally damaging. 

 

Instead of attempting to appeal to everyone, it is better to focus on a certain market. However, if you rely on statistics based on your own hunches and assumptions about that industry, you risk hurting your brand and squandering marketing dollars. 

 

4. Marketing Policies That Are Deceptive

 

Deceptive marketing policies do not target a specific market sector or demographic, and they typically go unnoticed by the general public. There are various methods of deceptive marketing. It can be conveyed to customers in a variety of ways, one of which is through humor. Humour provides an escape or relief from a number of human boundaries, and some advertisers may take advantage of this by using deceptive advertising tactics to push a product that may harm or relieve the constraints.

 

5. Transparency is lacking.

 

According to an Ovum survey, 68% of consumers stated they would utilize a do-not-track function on their search engine if one was available. Furthermore, only 14% feel Internet corporations are truthful about how they utilize customer data. 

 

Privacy concerns have risen to the fore in the recent decade, as consumers have grown cautious of corporate practices that follow their movements and collect personal information. However, as marketers, we need this data to understand our market's interests and requirements, as well as to create goods that people love and want. 

 

6. Misleading Claims and Messaging

 

Everything from inconsistent and misleading messaging and advertising to making false promises regarding the quality of your items might be considered deceptive marketing. 

 

For example, it's deceptive to announce a 50%-off holiday sale but then raise your prices by 50% to compensate for the reduction. It's also deceptive to offer a three-day bargain to your most loyal consumers first. However, because the sale was so successful, you should offer the same discount the next weekend to customers who aren't enrolled in your reward programme. 

 

7. Misuse of Consumer Information

 

Either accidentally utilizing consumer data or manipulating it for your own gain are unethical marketing practices. 
 

If you are not technologically competent, you may be unaware of how you (or third parties) are exploiting your consumer data. The problem is that the consequences of these practices will affect your company, not the guilty person. Your customers will blame you for not knowing what was going on.  Make sure your website and the data you collect are secure and hidden from third parties. Consult a professional if necessary to verify that your customer data is not corrupted or sold to third parties. 

 

8. Subliminal Communication

 

Subliminal messages are utilized in marketing materials to influence the consumer's thinking. Subliminal advertising may be illegal depending on how it is carried out. Advertisers can use attractive visuals, familiar music, and other messages that make customers feel good to send positive subliminal signals that do not breach ethical bounds. Learning how to efficiently use subliminal messaging while following ethical norms will help you increase your sales.

 

To conclude, Ethical quandaries are especially important in professional life since they occur regularly in the workplace. Some businesses and professional organizations (for example, CFA) have their own codes of conduct and ethical standards. Infractions of the standards may result in disciplinary action.

 

Almost every facet of business can become a source of ethical quandaries. Relationships with coworkers, management, clients, and business partners may be included.

 

By raising ethical issues, the discipline of consumer behavior may be able to evolve and spread in order to make a beneficial contribution to peace: "the one to which all thought, feeling, and finally all research should aim" (Hirschman and Holbrook 1992, p.126). It would be a tragic irony if, in their efforts to make a good difference, consumer researchers ethically violated the society they are aiming to help. Perhaps the researcher in the first case would not be wondering what to do now if he or she had examined the difficulties stated above.

Also Read | What is Service Marketing? Characteristics and Types