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The Trouble with Food: Ethics and Integrity in Food Marketing

Many years ago I visited a processing plant operated by one of largest U.S. food companies. I met with the plant manager and asked him about quality control at his facility. “It is my most important job,” he said.

He went on to explain that if American consumers buy an expensive luxury automobile and experience a mechanical failure, they angrily return it to the dealership for repair. But, if those same consumers buy a one-dollar can of tomato sauce and find it spoiled (or worse, discover a rodent hair), they are going to be more than angry. . .they are going to sue someone and tell the world why that food processor should be put out of business. Food, the plant manager said, is always an emotionally-charged subject because we put it in our mouths.

This article will discuss some of the many issues related to the ethics of food marketing, with an eye toward how emotion-laden that subject is. In doing so, the author wishes to acknowledge up-front that unethical behavior in the food business is likely very limited to a small number of individuals and companies. On the other hand, what is ethical or unethical in food marketing is far from settled, so it is also possible that many more instances of purportedly unethical behavior in the food industry may occur in the future.

The Trouble with Food

The trouble with food is that we all need it, we all want it to taste good, we all want it to be safe and beneficial, and we all want it to be reasonably priced. That balance is often difficult to achieve, and even more difficult to market in a hyper-competitive selling environment that always seems to attract controversy.

But are quality and price/value the most important goals for consumers? Consumers of the past, perhaps, but a 2002 study among 6,000 consumers around the world reported that, “(global shoppers demand) honesty and respect from retailers and brand manufacturers more (author’s emphasis) than they expect the highest-quality merchandise or the lowest prices.” 1 That same year the Gallup organization polled 36,000 people in 47 countries statistically representing 1.3 billion souls and found that business executives from multi-national companies are among the least trusted leaders when it comes to acting for the benefit of society. 2

It appears that the spate of corporate governance scandals has hardened public opinion about the veracity of business leaders and the integrity of their intentions. Business in most countries is under more scrutiny than it has ever been, and food brands are regularly in the spotlight. Some past and recent problems with food and beverages (such as the persistent infant formula controversy, mad cow disease scares in the UK and US, and the soft drink/pesticide scandal in India) are simply fanning the flames.

Why Business Ethics is Always a Challenge

Business ethics is always a difficult subject because there is often a fine line between what is admirably aggressive “good business”, and business practice that is harmful to one party or another. Let’s first look at some of the reasons why ethical standards are stretched, bent, or broken:

  • Ignorance: Although ethics has certainly become a more common topic of discussion in offices and boardrooms, it’s likely that most marketers believe that they are honestly presenting what they have to sell to consumers. Unfortunately, not all of them have actually explored just what consumers believe about their products and compared those opinions to the realities of product delivery. Ignorance, as the saying goes, is no excuse for mistakes, and ethical breaches cannot be excused because marketers were ostensibly unaware of their deceptions.
  • Naiveté: Some unethical behavior happens because the violator just doesn’t understand where the line is. Young executives at any number of packaged goods companies have inadvertently approved dubious advertising or promotions without the consent of their more experienced superiors. It will always happen as long as authority for potentially explosive issues is delegated to those who don’t realize the full ramifications of their actions. Unfortunately for those in charge, like the proverbial captain, they are responsible for all that happens on the ship.
  • Competition: In a typical US grocery store, there are more than 50,000 brands, line extensions, and flanker products. An average US consumer can be exposed to hundreds, if not thousands, of commercial messages each day. While such numbers might not be that enormous in other countries, it is a universal fact of the global marketplace that success attracts competition and competition forces all players to do things they might not otherwise do. The Oakland Raiders, an American football team, operate under a simple charge from their founder: “Just win, baby.” That also happens to be the mantra of most companies in a market-driven economy and it is the single most common reason why some marketers believe that virtually any means are justified by the end. Nothing will make some marketing executives consider offering more than can be delivered than to hear that the competition has already done so.
  • Expediency: Some government regulations or approval delays or confirmatory research studies just don’t seem to be worth waiting for. Successful leaders have a “bias for action” and occasionally that means cutting corners as well as red tape. Lawyers are often employed to help companies avoid legal pitfalls and/or explain their way out of ethical quagmires. Nevertheless, more than one enterprising executive has skirted ethical boundaries because he/she believes in asking for forgiveness, not permission.
  • Accommodation: Ethics can sometimes take a backseat to the need to please. A marketer’s supervisor, and that supervisor’s supervisor, and the CEO, and the company investors, are all looking for the same thing: profitable revenue. Although they may be ethical professionals who want to operate accordingly, they are compensated for financial results. The scandals they read about in newspaper certainly may give them pause, but an ethical company that loses money is still unacceptable. This is when ethics can be stretched, and considered no more harmful than a white lie.
  • Financial Gain: This is the most obvious reason to stretch the rules. Market economies demand success and promise rewards commensurate with effort, often regardless of the intent of that effort. And, let’s keep in mind that chief marketing officers within public companies are often held personally accountable for increasing shareholder value. There’s nothing wrong with that. . .unless it is accomplished in a less-than-ethical manner.

As we examine various examples of business ethics violations, one way that they appear is along two planes: those that are intentionally committed versus those that are inadvertent, and those whose impact is more visible versus those that are more subtle. As the graphic to the right indicates, they create several combinations that can present a challenge to the unaware.

While we are all shocked (if not surprised) by the blatant and intentional forms of ethical violations that are becoming more common today, it may be the more subtle types that are the most insidious. Trust between buyer and seller can be seriously damaged in either case, but the subtle unethical actions can do considerable damage to valuable brand equity before anyone notices that something is not quite right. And, if such actions are intentional, the violators are every bit as culpable as those we read about in headlines.

Whatever the type or motivation, ethical behavior is now permanently on the minds of customers in virtually all industries, including food.

Integrity as a Working Discipline

While the larger field we are discussing is called “ethics”, it is rooted in the more elemental attribute of “integrity.” The issues discussed throughout this paper, and many more that are not, could be effectively addressed by companies if they treat integrity less as an idealistic backdrop and more as a practical, working discipline.

I would propose that such a discipline should at least include the following “Points of Integrity” that could serve as the superstructure for honorable decision-making:

1. Integrity of Targeting – The marketer seeks a fully equitable partnership with the potential customer. Marketers who target those who are not old or mature enough to know that they are being marketed to, are not acting responsibly. Neither are those who market to consumers who are not knowledgeable enough about a subject to make intelligent choices. Some may believe that children are “fair game” for all types of advertising and that it is the parents’ responsibility to monitor what they see and do. Anyone who has a child over the age of five knows that such a challenge is difficult, if not impossible. One premise of food ethics is that it is the responsibility of the marketers to ensure that their audiences are capable of understanding the marketing transaction.

In food marketing, children and others who are not sophisticated in their assessment abilities can be the unsuspecting victims of marketers who encourage sales with no regard to their customers’ well-being. It has long been considered a harmless technique in retailing, for instance, to stock impulse items such as candy and gum near the check stand so that children will grab them before their parents leave the store. Is that just good, old-fashioned opportunistic marketing, or is it taking advantage of children (who reflexively grab candy) and their parents (who have to battle with their children at the same time they’re trying to pay the grocery bill and leave)?

At the corporate level, these issues might be more thoughtfully considered if the company establishes a “targeting code of ethics” that lays out specific ethical guidelines regarding the age, maturity, vulnerability, and general capability of marketing targets. This is not necessarily a policy that has a deleterious impact on sales, but even if it is, it will convince the people of the marketing company believe that their organization is doing all that it can to market responsibly.

2. Integrity of Performance – The marketer ensures that the products/services achieve the highest possible performance standards. This is a goal that is simple to envision and difficult to pull off. In brief, integrity of performance means that performance standards are set as high as is feasible, which has several business benefits, including: 1) it helps erect higher barriers to entry, thus insulating against competitive inroads; 2) it discourages loosely loyal customers from jumping ship to a competitor; and 3) it attracts the highest quality employees who want to work for a company that makes top-flight products.

But why is superior performance an integrity issue? Because superior performing products do not need to be promoted or sold with questionable methods. Their quality speaks for itself, and quality and integrity always seem to go hand-in-hand.

To borrow some examples from non-food industries, Lexus is an example of a brand that is driven by product and service integrity. Obsessive adherence to performance integrity has been one reason why Lexus is one of the largest selling luxury lines in the world.

When Steve Jobs returned to Apple in 1997 and promptly returned the company to its roots as a company with superior product integrity (something they had been missing for nearly a decade). Apple is now astonishingly profitable, given their previous circumstance, and they are being talked about as a possible successor to the troubled Sony brand in the huge consumer electronics industry.

We’ve seen the same dedication to unrelenting product integrity in such food brands as Haagen-Dazs ice cream, Whole Foods retailers, and India’s Hindustan brands.
Everyone in a company wants the products and services to work well, but profitability and resource constraints often prevent marketing from delivering the best possible versions to customers. Integrity of performance can become a certainty, however, if the company eliminates any and all flaws in its products that could compromise the customers’ faith in that company.

3. Brand Integrity – The marketer builds brands of authenticity and sincerity, and only makes brand promises that can be met or exceeded, which is the mortar of solid customer-marketer partnerships.

Establishing promise-keeping can be approached from two angles: delivering what is promised and promising only what can be delivered. A brand is fundamentally a promise that is continually kept. Simply by being marketed, a food brand makes certain promises. . . on its label, through its name and other nomenclature, by what aisle at the grocery store it is shelved, and by its marketing communications (see below).

A food company can avoid credibility gaps with its customers by installing a fool-proof system for filtering out unrealizable promises before they are released to those who might actually believe them. Most food companies have legal and technical clearance departments that routinely check for errors in specifications and consumer usage information. In addition, the chief marketing officer might also establish one or more “ombudsmen” whose role is to ensure that any and all brand contacts accurately and honestly reflect what is actually being delivered.

4. Promotional Integrity – The marketer promotes honestly, not just legally. Marketers in regulated industries, including food, have slipped into the habit of believing that they are operating ethically if they obey the law. But there are plenty of opportunities to do one and not the other.

When there are disparities between a food product’s claims and its capabilities, a brand may be delivering legal information that borders on the unethical. For example, every carbohydrate-laden food product delivers “energy in the sense that carbohydrates are converted to a form of sugar known as glucose, producing energy for the body. But how much more valuable to the body is a so-called “energy bar” compared to a similarly constituted “candy bar”? Is that honest repositioning or a marketing sleight of hand?

And, as in the pharmaceutical industry, there may be potentially harmful side-effects from some foods and beverages. If so, should the public be reminded about those side-effects in their marketing promotions, or should it be a policy of caveat emptor (let the buyer beware) because we can’t warn everybody about all the dangers of a myriad of food products?

Despite what might seem to be onerous government regulation of the food industry in many countries, it is generally impossible for government agencies to know as much as a manufacturer about what can go right or wrong with its products once put into consumer hands. That’s why it’s important for such companies to carefully review existing regulations and general promotion guidelines for their industries and determine if they are meeting those criteria. Ideally, the company would then set even higher promotion standards that address such issues as honesty of claims, instances of exaggeration (advertising “puffery”) and generalization that are questionable, and the balance between aggressive and misleading marketing promotion.

5. Value/price Integrity – The marketer fields prices that fit the value offered, and value that is fairly priced. A few years ago a major global ready-to-eat cereal manufacturer was the target of a consumer backlash when its steady pricing increases far exceeded the rise of inflation. The company was forced to roll back prices because consumers knew that the marketer was selling relatively inexpensive grains for exorbitant prices. In short, as in other similar cases, the integrity of the price/value relationship was violated because the price far exceeded the perceived and real value of the product sold.

It certainly can be argued that this is nothing more than the market economy at work. Price elasticity is ultimately determined by the consumer, that view would argue, and the consumer spoke. But is there no limit from an ethical standpoint to what the marketer should make on a box of cereal? Should marketers charge whatever they can get away with and have no concern for what is patently unfair to consumers?

Returning to the issue of children, many teens and “tweens” (9-12 years) in advanced economies have inordinate amounts of spending money made available by their parents. Youngsters this age are often more interested in conspicuous consumption than in getting the best value for their money. Is it ethical for companies to charge whatever the market will bear, even if those buying the food products are unwilling or incapable to make good value decisions?

Food companies need to consider researching this issue more thoroughly and then defining appropriate value and price parameters. They might also consider analyzing existing pricing structures and refocus those guidelines that are purely based on profitability goals to better reflect customers’ own views on value.

Integrity of Intent — All of the above “Points of Integrity” would be driven by a single motivation that I call “Integrity of Intent.” By that I mean that the individual marketer is committed to integrity and honesty with each decision that he or she makes. This is often an acquired instinct that becomes second-nature after awhile, serving as either a gratifying reminder or a built-in alarm system, depending on what ethically difficult decisions are to be made.

Marketing Ethics and the Individual Marketer

Hopefully this paper has provided marketers with some new ideas and approaches that will help them deal effectively with the ethical challenges they may face in food marketing. However, the final arbiters of what is ethical, and what actions should ensue, are the individual marketers themselves. It is those marketers – with the help of their partners, the customers – who must challenge conventional wisdom about what is, and define the new boundaries of what should be. One common sense litmus test for that challenge was proposed by Ken Goodman, co-director of the ethics program at University of Miami. Goodman suggested that, when confronting ethically sticky issues, “. . . all you have to do is ask yourself: ‘What would your grandmother think?’” 3

Philip Kotler, Professor Emeritus of Marketing at Northwestern’s Kellogg School of Management puts the challenge to marketers another way: “As professional marketers, we should have the same ambivalence as nuclear scientists who help build nuclear bombs or pilots who spray DDT over crops from the airplane. Some of us, in fact, are independent enough to tell (our internal and external clients) that we will not work for them to find ways to sell more of what hurts people. We can tell them that we’re willing to use our marketing toolkit to help them build new businesses around substitute products that are much healthier and safer.” 4

To those sage words, I can only add what I tell MBAs on the final day of my marketing courses: When you move up through the ranks of your future organizations you will be asked to report to those in higher and higher executive levels. But no matter who you report to, no one has the right to ask you to do something that would compromise your integrity.