Ethical principles and rules have a great impact on buyer behavior and relations with potential customers. B2C and B2B companies must identify where their own best opportunities lie. For consumer product companies this may merely involve promoting their product and its safety or environmental benefits. Perhaps comparing the relationships between marketing and ethics will shed some light on the profitability considerations. Although being ethical for the sake of being ethical is an admirable goal, it must be remembered that businesses are in existence to make money.
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It is possible to say that for B2C businesses, ethical regulations are more importance because these companies sell an end-product to the end consumer. Among them is the “weights and measures type” to whom the most important fact about a product label is the net weight, preferably evened off to avoid fractional ounces (Elliot, 2002). It is B2C responsibility to bring to the marketplace an expert point of view. Decisions must in fact constitute what the consumer would do or choose: if a customer has the best technical education, or if a customer has the most modern tools for testing and evaluating. Ethical standards and quality must apply, for the average consumer, the kinds of tests and standards they cannot apply for themselves (Carson, 2003).
B2B are responsible for product quality and high standards, on time delivery and the privacy of partners. The pressures imply the development of rules and standards by which business actions may be judged as “right” or “wrong”. In other words, ethical decisions for B2B are “moral decisions”, impelled by social sanctions, but modified by economics and environmental requirements (Minett 2001). The growing professionalism in marketing is also stimulating the development and acceptance of pervasive “socially conscious” standards of ethics. There are many types of consumers in the marketplace (Frederick 2003). B2B businesses should respond thoughtfully and rationally to the issues rather than react negatively or not at all.
In contrast to B2B, B2C companies should pay a special attention to advertising and promotion. Consumers are also demanding that business firms listen to them and their complaints and desires, and that firms seek out such information. Consumers desire an effective two-way communications channel between firms and themselves. This channel, if properly utilized by the firm, could lead to quicker reactions to consumer communications and complaints. Such action may also help the business community avoid further governmental intervention (Elliot, 2002). For B2C, any appraisal of advertising must recognize that it cannot be viewed in total isolation.
After all, it is but one, albeit to the consumer the most common, of numerous forms of marketing communications, including personal selling, packaging, point-of-sale materials, and sales promotion (such as coupons and premiums) (Sims 2002). Further, advertising is but one in the constellation of elements that constitute the familiar marketing mix, including price, product policy, distribution, and others, which every successful marketer must develop and adjust for his products and brands.
Difference between B2B and B2C
In contrast to B2B, B2C companies should pay more attention to cultural values and individual differences of consumers. For B2C, day-to-day pressures are extremely critical because they are related to the immediate survival instincts of the individual decision maker. Even though the product may be accepted well and be very popular in the marketplace, it should not be considered consumer friendly unless it provides adequate consumer information, it is designed with consumer protection in mind, and its features are such that the product provides a maximum amount of short-run and long-run benefits for the user without hurting other consumers who will not buy or use this product. B2B is responsible for social good and strict industry standards (Frederick 2003).
Also, for B2B logistics efficiency is related primarily to reduced cost. Being able to handle physically the same volume of business at a lower cost and/or with minimum amount of resource utilization is basically a display of efficiency in physical distribution. The area of inventory control has become sophisticated substantially. Because of recent progress, retailers have minimized inventory outages that mean lost business.
Furthermore, improved knowledge of inventory controls enabled the retailers to minimize the inventory levels that are carried by these stores. Decentralized warehousing has increased wholesaling efficiency by minimizing the waiting time for deliveries. Thus, the retailing sector benefits from reduced waiting time and increased efficiency. These innovations allow B2B companies to meet industry standards and ethical principles (Treviño et al 1999).
The same aspects for two companies
For both B2C and B2B companies, it is important to apply ethical principles to all spheres of business activity and relationships with customer. Although being ethical for the sake of being ethical is an admirable goal, it must be remembered that businesses are in existence to make money. The main difference between B2B and B2C is found in their approach to buyers: B2C is responsible for possible health and safety hazards while quality and truthfulness are more important for B2B dealing with greater volumes of products and limited number of buyers.
Carson, Th. L. 2003, Self-interest and business ethics: Some lessons of the recent corporate scandals. Journal of Business Ethics; (43), 4; p. 389-394.
Elliot, S. 2002, Electronic Commerce: B2c Strategies and Models. Wiley; 1st edition.
Frederick, R. (ed.). 2002, A companion to business Ethics. Blackwell Publishers.
Minett, S. 2001, B2B Marketing: A radically different approach for business-to-business marketers. Financial Times Prentice Hall.
Sims, R.R. 2003, Ethics and Corporate Social Responsibility: Why Giants Fall. Praeger.
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Treviño, L.K., Weaver, G.R., Gibson, D.G., et al. 1999, “Managing ethics and legal compliance: what works and what hurts”, California Management Review, vol. 41, iss. 2, pp. 131-151.