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Globalisation - ethical issues (4 key issues of globalisation relating to…
Globalisation - ethical issues
4 key issues of globalisation relating to consumers
different consumer protection standards
exporting of consumerism & increase in cultural homogenisation
marketing targeted at low income consumers in developing nations
business operations geographically segregated
1. Different standards of consumer protection
taking advantage of countries with few legal restrictions to market its offering
e.g. pharmaceuticals - suppressing side effects
USA has less legal restrictions meaning Pharma's can market direct to consumers
(mass advertising)
aim is to encourage consumers to ask doctors to prescribe product
simultaneously indirectly marketing to developing nations
social objection to advertising may be limited if standards bodies are self-regulatory & lack resources vs more powerful industries
international co-ordination on standardising marketing restrictions on certain industries/ products have been attempted by org's such as WHO, however differences still exist
e.g. Tabacco, automobiles, medicines, food & drink
2. exporting of consumerism & increase in cultural homogenisation
spread of consumerism by spreading of values through trade
outcomes = large scales consumption changes
e.g. China
concerns
wellbeing of consumers
consumers seeking wealth, fame and image will not fulfil true psychological needs
increase cultural homogenisation is diminishing local culture
similarities of shops & offerings in cities globally
dominance of global brands
entertainment & sports
e.g strong link between preference to foreign brands rather than local brands in India because middle class consumers admired life styles in economically developed countries
i.e. a status enhancing culture
aggressive tactics by MNCs
squeezing out local providers
the role of int. marketing on exporting consumerism
e.g. increase in plastic surgery in Shangai is directly related to a young female's view on Western beauty & thereby attempting to mimic
plastic surgery also attributed to success, traditional family values (honour) & creating a bond between mothers & their daughters
fashion
increase in affluence and decrease in price stimulates consumption (incl. in emerging countries such as India
traditional forms of clothing being replace by global fashion
spending habits increasing
form of leisure activity
attitudes towards fashion changing
helps construct self-identity
negative results
e.g. marginalisation of traditional garment wearing individuals by western dressed individuals
other consequences
brand dilution
changing too much of core brand to suit local needs
offensive marketing
customers may view attempts to localise products as an insult
developed countries consume more than their share
impossible for the world to support all countries behaving in a similar manner
growth in 'throwaway society'
exporting of consumption
e-waste
accounts for high % of global non-recyclable waste
has hazardous elements
waste methods
open fires, acid stripping
Asian countries have high adoption rate for tech but does not have sufficient waste infrastructure to cope with increase in e-waste
all types of electrical equipment
e.g. food, fashion
possible short-term solutions to minmise waste
product leasing or sharing
product recapture
recycling, refurbishing, re-manufacturing
developing products which are less environmentally harmful
3. marketing targeted at low income consumers in developing nations
two key concerns
products marketed are beyond the reach of low income consumers - perpetuating dissatisfaction
issues
detrimental impact
marginalisation from people who are able to afford offerings
exclusion from targeting can increase gap between affluent and the poor
Predominantly health
poor normally impacted
e.g. Pharmaceuticals target the affluent consumers thereby focus R&D for these consumers only
possible exploitation of low income consumers
issues
low income communities more vulnerable
lack of education or information
unable to make informed decisions on certain products
economically restricted = less choices available vs affluent areas
contrasting & arguable benefits
large MNCs have ability to transform lives
stimulate commerce & development at the bottom
creates stability, less dangerous
basic offerings & low cost but also profitable
sources of new & rapid growth
outsourcing & innovation potential being transferred back to developed nations
pioneering of commercial & tech innovation as a result of adapting to local needs
barriers to this
corrupt intermediaries
lack of or poor infrastructure
4. business operations geographically segregated
Issues
demand for products due to consumers being shielded from negative elements of offering being manufactured in developed nation
e.g. depletion of raw materials, poor & dangerous working conditions
loss of jobs in developed economy
consumers downplay the negative effects of their consumption behaviour
long & complicated supply chains make it difficult to ascertain the ethical credential of a product
monitoring by parent company = difficult
employment standards
MNCs exploiting countries with lower tax
lower barriers to entry