rewriting work

2018

Social, Ethical and Legal Implications

Nike had outlined its social, ethical and legal issues within its target market section of its marketing plan. The consequences of not addressing these key areas are inherently understood and not tolerable by Nike domestically or internationally. Also expressed are the marketing performance monitoring and control aspects Nike uses to improve its marketing plan.

Target Market

Social Issues

Nike takes social responsibility seriously and understands the repercussions if lacking. Nike wants to continue to be the company that is respected for its strong values and high standards. “A new approach to social responsibility is needed to move the emphasis from the company to society as a whole” (Chitakornkijsil, 2012, pgs. 110-111). Even though Nike’s strategic goal is to earn a profit and satisfy stakeholders, there is a conscious effort to support employees, community and ecology, simultaneously placing focus on building lasting relationships and partnerships. Nike initiated corporate social responsibility (CSR) and had embedded this into their marketing objectives and strategy.

Engaging the company in the public eye domestically in the U.S. and becoming transparent with compliance reporting has boosted Nike’s image and supported its marketing efforts. Domestically Nike has also instituted donating sportswear to lower income school sports programs abroad. Within the international market in Asia, Nike has increased employee pay to exceed their established minimum wage requirement. Within the European international market, Nike has raised the bar supporting the environment and reduced its carbon footprint drastically.

Ethical Issues

“Research into Marketing Ethics has been defined as ‘the systematic study of how moral standards are applied to marketing decisions, behaviors and institutions” (Williams & Aitken, 2011, p. 446). Nike has endured criticism for outsourcing much of its product manufacturing overseas in various foreign countries through independent contractors. Although this is a not an illegal business practice, it does depict an ethical dilemma. In the past, Nike has also faced boycotts and protests for labor practices and environmental concerns. Nike substantiated many of its company strategic decisions to outsource manufacturing from the U.S. to the Asian market not only because of cheap labor but because many Americans turn down minimum wage jobs and the employee turnover rate is astronomical. Nike also requires employees to complete ethics training annually ensuring everyone understands standard operating procedures. Employees from the top down are expected to be virtuous and obligated to do what is right even when no one is looking.

Legal Issues

Nike has seen its share of legal battles domestic and international. U.S. based operations have faced a copyright violation over the Jordan brand symbol because it originated by using National Basketball Association (NBA) photos. The European market has encountered stringent environmental laws that are different from the U.S. The Asian market has been plagued by workers low pay and abusive labor practices. Nike rebutted these lawsuits and eventually paid millions of dollars to settle claims. The fundamental aspect for Nike where operating within the global markets is they have established regional headquarters such as Europe in the Netherlands and Asia in China to mitigate legal issues by conforming to international laws with oversight from its U.S. domestic-based world headquarters in Oregon.

Monitoring and Control

Nike has established programs, processes, and systems along with inspections, evaluations, audits, and training to use in monitoring and improving marketing performance. Nike tracks performance on a balanced scorecard and it is maintained within the company dashboard intranet database. Metrics have been created to measure marketing activities against past and expected current performance results. Metrics used are goals, strategy, sales, budget, marketing mix, past performance ratings, etc. Nike also uses customer surveys to gain valuable information from consumers. Benchmarking of competitors within the industry is another way Nike achieves baseline insight. Nike’s market performance monitoring and controlling feedback and follow-up results are used to update not only objectives and strategy but also the marketing plan itself. Nike’s marketing plan is a living document that is persistently updated to reflect actual company marketing activities. Nike monitors the market within the U.S. and its international geographical locations separately but blends them in the end for a total view of market performance. Below is Nike’s monitoring metric and control flowcharts.

Nike not only realizes the impact but is a good steward of socially, ethically and legality issues domestically and internationally. Nike has expressed its social interaction, ethical awareness, and legal compliance. Nike continually attempts to find ways to improve its marketing performance through monitoring and controlling to be a constantly growing company.

References

Chitakornkijsil, P. (2012). Brand integrity, advertising, and marketing ethics as well as social responsibility. International Journal of Organizational Innovation (Online), 4(4), 109-130. Retrieved from The University of Phoenix MKT571 website.

Kotler, P. & Keller, K. L. (2016). Marketing Management (15th ed.). Retrieved from The University of Phoenix eBook Collection database.

Mintz, O., & Currim, I. S. (2015). When does metric use matter less. European Journal of Marketing, 49(11/12), 1809-1856. doi:10.1108/EJM-08-2014-0488. Retrieved from The University of Phoenix MKT571 website.

Williams, J., & Aitken, R. (2011). The service-dominant logic of marketing and marketing ethics. Journal of Business Ethics, 102(3), 439-454. doi:10.1007/s10551-011-0823-z. Retrieved from The University of Phoenix MKT571 website.