October 22, 2019

The following is republished with the permission of the Association of National Advertisers. Find this and similar articles on ANA Newsstand.

By Michael J. McDermott

Ethical behavior has long been a concern for responsible marketers. But in a digital age, just what constitutes ethical marketing has become a moving target.

Mark Bartholomew, a professor at the University at Buffalo School of Law and author of Adcreep: The Case Against Modern Marketing, recalls that in the analog age, most ethical concerns centered around how competitors treated each other, not how they treated their customers. "A big concern was not trashing your competitors or framing comparisons in ways that might generate ill will," he says. "Today, that concern is still there, but there is less of it. Competitive advertising is a little more cutthroat than it was pre-2000."

Responsible marketers adhered to other ethical guidelines in the analog age, of course, some of which were intended to protect the interests of their customers and prospects in areas like disclosure and accuracy in advertising images. But it's only in the digital age that the pendulum has fully swung in that direction. "Now there's more of a concern about ethical behavior toward consumers than there was in the past," Bartholomew says.
 
Digital Tech Pushes the Boundaries

As digital ad spending has surged to preeminence — it now accounts for more than half of total U.S. media ad spending, per eMarketer — it's created a host of challenges for organizations trying to determine where the boundaries of ethical marketing now lie and how to stay inside them.

Privacy and transparency are the two biggest issues, and they're closely related around the concept of trust. "There is a crisis of trust in institutions, and without trust you cannot have growth or innovation," says Stephanie Buscemi, CMO at Salesforce, which has been recognized as one of the "World's Most Ethical Companies" by Ethisphere, which defines and codifies standards of ethical business practices that fuel corporate character, marketplace trust, and business success. "Nothing is more important than creating and cultivating communities around your brand, and you create them through shared values," Buscemi adds.

In fact, Buscemi ranks trust as Salesforce's No. 1 value. "Nothing is more important than the open, transparent relationship we have with our customers and all of our stakeholders — employees, partners, and communities," she says. "Brands build trust with authentic communities. The brands that are successful today don't just pitch, they have conversations. They listen."

Salesforce doesn't just talk the talk on these issues, it takes action. Through its office of ethical and humane use, it's established a set of guiding principles on the ethical use of technology to safeguard human rights, data privacy, and human safety. "We know that technology is not always inherently good or bad," Buscemi says. "It's what we do with it that matters. We understand that we have a broader responsibility to society, and we aspire to create technology that not only drives the success of our customers, but also drives positive social change and benefits humanity."

Buscemi points to the Trailblazer program as an illustration of how Salesforce brings to life its commitment to building brand trust with authentic communities. "We have now cleared 1.5 million people who are part of the Trailblazer community," she says. "They are using Trailhead, our free, gamified online platform that empowers anyone — no matter their education level or background — to learn the skills needed to land a top job in tech."

She adds, "We are invested in Trailblazers as the future of Salesforce. We tell stories through the success of our own customers. Who better to tell our story than our customers and partners? Some of our most inspiring and shared content comes from this Trailblazer community, not from Salesforce directly."

Plenty of Ethical Issues to Tackle

While legislation like the GDPR and the CCPA is bringing some standardization to privacy and transparency requirements, marketers are still left to find their own way on a host of related issues, ranging from social and influencer marketing to user-generated content. And no matter how well-intentioned their efforts in those areas might be, marketing that relies, increasingly, on digital technologies remains fraught with risk.

"The risks around big data platforms all have to do with the speed, scale, and reach of these technologies, especially when machine learning is involved," says Jacob Metcalf, a researcher at Data & Society, an independent nonprofit research institute committed to identifying thorny issues at the intersection of technology and society. That speed, scale, and reach means any ethical errors a marketer might make will be dramatically magnified, he warns.

The underlying problem is a disconnect between marketers' intentions and the nature of machine learning. "The thing about machine learning is that it doesn't care at all about your categories," Metcalf says. Datasets that are continually updated are built on the assumption that all datasets can talk to all other datasets, regardless of domain (health, finance, credit, demographic, psychographic, etc.), to find unexpected patterns, so domains end up bleeding into each other.

"The risk for marketers is that you are going to jump into these other elements of people's lives unwittingly in a way that will make them very uncomfortable," Metcalf says, pointing to the Facebook and Cambridge Analytica scandal. "There's also a risk that the platforms you rely on to target individuals for benign marketing will also be used for very nonbenign purposes."

'Known Knowns' and 'Known Unknowns'

Compounding the challenges regarding ethical marketing in the digital age is the issue of "known knowns" and "known unknowns." Joanna L. Jenkins, Ph.D., associate dean of continuing education, graduate studies, and professional studies at Moore College of Art & Design, notes that the current environment is characterized by rapid proliferation of media and technology that contributes to widespread polarization and media fragmentation.

"The more media and technology that users consume, the more likely their tastes and preferences are distinct and fragmented as it relates to their consumption patterns," Jenkins says. Contemporary media, characterized as interactive and real time, further raises the stakes.

"Collectively, this places advertisers and marketers in a different power position than before, one in which they are often forced to react to consumers, which is counterproductive to industry and planning cycles," Jenkins says. As a result, new technologies must constantly be mastered and new strategies constantly deployed, which requires ethical guidelines to be revisited, enforced, modified, and amended to address the needs of the moment, she adds.

The Influencer Marketing Minefield

Influencer and social media marketing are areas that raise numerous ethical concerns for marketers, says Yvette Sterbenk, assistant professor of strategic communication at Ithaca College. "Companies need, first of all, to have FTC-compliant standards about how they'll work with influencers," she says of Federal Trade Commission regulations, "and to communicate those expectations in clear contracts with the influencers. People should always be able to tell if a post is sponsored in some way."

Bartholomew agrees that transparency is the key issue. Marketers have an obligation to make sure that anyone viewing an influencer spot knows not only that the influencer is being paid for it, but also exactly which company is providing that payment. "Marketers need to ask themselves what they need to do to make sure that end users can tell if the ad is placed or organic," he says. "That's difficult, because we haven't always gotten great guidance from the FTC. Norms tend to change online, but that's the main ethical boundary here."

In the absence of more specific regulatory guidance, marketers are taking steps to set their own ethical guidelines in this area. For example, Hilton, another "World's Most Ethical Companies" honoree, partners with influencers to tell the story of its hotel brands and properties, and leverages user-generated content to bring travel experiences to life for other travelers, says CMO Kellyn Smith Kenny.

"In both cases, we have developed guidelines and best practices for our brand and property teams to follow that ensure we are following applicable laws and regulations around the world," Kenny says. "We have a team focused on social governance at Hilton, helping corporate and property teams stay on top of changes in best practices and laws. The governance team communicates with social media users through a weekly email newsletter and through an internal portal called the social hub."

Different Ball Game for Nonprofits

Ethical marketing issues like transparency and the integrity of influencer and social media marketing can be especially important for marketing organizations in the nonprofit sector — perhaps even more so than in the commercial sector.

"We don't have shareholders, we are not a publicly traded company, so what motivates us is very different from some other marketing organizations," says Barbara Shipley, SVP of brand integration at AARP, which is also a "World's Most Ethical Companies" honoree. "Still, we are very attuned to ethical issues. We have a chief privacy officer, and we are extremely focused on transparency and the way we manage data. We are rigorous in monitoring our service providers and partners, especially from the perspective of quality control."

AARP works with subject matter experts and influencers in some areas, but it has never had a paid brand spokesperson, and that's intentional. "One reason is that it's something we can't control," Shipley says. While an individual might be a paragon of ethical behavior at the time they are contracted, their reputation might change in the future. "That said, we do engage with subject matter experts who are credible messengers on topics that matter to the 50-plus cohort, such as caregiving, fraud, work, and jobs," she says. "We have a range of these ambassadors, and they are influencers."

Take Frank Abagnale, author of Scam Me If You Can: Simple Strategies to Outsmart Today's Rip-off Artists and the subject of the hit 2002 movie Catch Me If You Can, in which he was played by Leonardo DiCaprio. "He is a highly credible subject matter expert on fraud," Shipley says. "He advises us and does podcasts and personal events and works with the media."

Staying Ahead of the Ethical Curve

The rapid pace of change in digital technology drives equally rapid change in the realm of ethical practices, and forward-looking marketers are taking steps to keep pace. Hilton, for example, is working to make sure that marketing and all other departments march to the beat of the same drum as far as ethical marketing is concerned.

"We must evolve with the changes in the industry to ensure that Hilton is ethical in our marketing processes," Kenny says. "We work very closely with our legal team and our agencies to ensure that when new laws are enacted, or when new practices are discovered, Hilton is not only aware, but also applying it to our work. We bring stakeholders together to discuss changes and develop a plan of action for implementation, often issuing white papers and guidance through our internal newsletters and portal to ensure awareness across our global team."

Buscemi, from Salesforce, sees the focus on ethical behavior as an opportunity to boost marketing's value to the C-suite by making these issues part of its core and taking the lead in responding to them.

"CMOs and marketers need to look beyond the traditional boundaries of marketing, such as advertising and campaigns, and identify new ways to connect with people, delivering relevant engagement anywhere they touch the brand," she says. "This is a CEO priority — how is the company going to transform and connect with people in a new way? If you look across a CXO leadership team, the CMO is very well-poised to be the person to advocate and lead that charge in an organization."

 

 

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