1. Identification of Case Issues
Base your issues on theoretical international ethics concepts. As the international marketing manager, what are the ethical issues to be considered in this case? Use journals to help give your response depth
The report aims at launching the new fair trade chocolate brand – Mars, and analysing the current ethical understanding of the Japanese marketing environment. The business viewed the ethical issue which child slavery has created an unethical comparative advantage, and the current market for chocolate lies in the ethical ruin (Nicolas and Gittens, 2010). The result of the influence of fair-trade foods among Japanese shows that the participants in Japan do the ethical purchasing in observable condition much more than the anonymous condition (Kimura et al., 2012; Swaidan, 2012). The ethical purchasing of observable condition is about that about making products in an environment where there is no child abuse or child labour, that is environmentally conscious and where there is a value placed on workers and their safety (Nicholls and Opal, 2005; Impact of adverse economic shocks on the Indian child labour market and the schooling of children of poor households, 2012).
Furthermore, the report claimed that is not only the purchasers’ participation of ethical “fair deal”, but also the corporation participations impact on fair trade as well; especially under the effect of the global economic recession, businesses have great potential to benefit or threaten at the market (Lynch, 2012; McCall-Rosenbluth and Thies,2011; Reed, 2009). According to the report of Swaidan (2012), Japan has suffered painful economic recession and a series of corporate misconducts and scandals over the last decade. In the meantime, people’s interests in business ethics and corporate social responsibility have remarkably increased (Tsalikis and Seaton, 2011). There are many similarities exist between Japanese and American managers which including the respective views on corporate social responsibility and unethical business practices (Tae and Nakano, 2008). Thus the marketing strategy should to consider the nation’s business ethical understandings.
Furthermore, according to a personal perspective, the correct ethical behaviour differs, which includes the relativist, utilitarian, and Universalist perspectives and based on socio-economic status (Fletcher and Crawford, 2011; Lynch, 2012). It states a market where corruption is an issue as Japan ranked eighteenth on the Corruption Perception Index of major emerging markets (Tae and Nakano, 2008; Tsalikis and Seaton, 2011). In Japan, the primarily views business ethics are through relativist and utilitarian perspectives (Fletcher and Crawford, 2011; McCall-Rosenbluth and Thies, 2011; Nicolas and Gittens, 2010).
It will evoke the previous ethical perspectives when business markets a fair trade product to the Japanese. The ethical behaviour differs across nations, influenced by popular attachments to governments, popular customs, level of economic development, relative size of public sector, low income for public servants, obscure legal and political environments, high level of government control and state ownership (Kimura et al., 2012; McCall-Rosenbluth and Thies, 2011; Swaidan, 2012). Moreover, according to Hofstede’s four cultural dimensions, Japan outranks all other countries in the measure of masculinity (Fletcher and Crawford, 2011). Hence, the marketing strategy must cater to the nation’s business ethical behaviours, and cultural dimensions facing fair trade products.
2. Formulation of alternatives or possible solutions with respect As the International marketing manager what are some alternative solutions, based on an ethical platform? Use journals to support your alternatives.
Mars’ first entered the Asian market with a marketing strategy of sponsoring and becoming the official snack food of the 1990 Asian Games in Beijing (McElhatton, 2012). In addition, it claims that Mars has a legacy for aggressive instincts in international expansion, entering the Eastern European markets after the collapse of the Soviet Union in 1991 (Allen, 2010). These movements lead to factories being opened in the Asian markets to better understand the domestic environments, and it is the solid foundation for Mars to target and market the Japanese market which it was successful in combining investment with community activities to relay positive company behaviour in the political environment (McElhatton, 2012). Additionally, it proved that a link exists in successful brands between company ethical and social requirements, and the company’s commitment to protecting consumer rights and interests (Castaldo, Perrini, Misani and Tencati, 2011; Fletcher and Crawford, 2011; McCall-Rosenbluth and Thies, 2011).
Thus, Mars must show it is not only has corporate social responsibility but its interest in the rights of its consumers, in order to market a new fair trade brand of chocolate in Japan (Nicolas and Gittens, 2010). Further, the right for Mars’ consumers to have access to chocolate is fair trade that gives added value and competitive price (Allen, 2011). From the perspective of economies, fair trade marketing may be successful if it is existed that consumers whose additional willingness to pay for fair trade products are greater than the additional marginal costs (Lynch, 2012). However, the consumers who felt greatly affected by the global recession yet want to consume ethically, marketers must deliver value without compromising these social values (Castaldo, Perrini, Misani and Tencati, 2011).
The report confirmed that the Japanese expect companies to stand behind their product well after a sale is made. They are not particularly price conscious, but rather rely on trust (McCall-Rosenbluth and Thies, 2011; McElhatton, 2012). Moreover, there are restraining forces in the market such as political systems, legal requirements, cultural norms and economic development, that hinder the free flow of fair trade in the market (Fletcher and Crawford, 2011). In Japan, it is not simply enough to support the goods, but marketing mix is more important to the Japanese consumers who demand the after-sale services on financial resources, and the weakness of service is not tolerated in the Japanese market (Slavery involved in food production, 2008; Swaidan, 2012; Tsalikis and Seaton, 2011). On the other hand, the benefits of lowering 20 percent tariff of chocolate imports in Japan which is almost three times of the USA levy on imported candy (McCall-Rosenbluth and Thies, 2011; Reed, 2007).
The chocolate potential market for Mars grows as the high tariff is getting lowered, and allowing a new fair trade chocolate brand greater entry. If Japan is a significant leader in the Asian region drops its tariff, Korea as the other major potential market may follow (Allen, 2011; Tae and Nakano, 2008). Japanese have their own take on Valentine’s Day which is a big chocolate buying frenzy (Tsalikis and Seaton, 2011). Gifts of chocolate from women to men on St Valentine’s Day have become a subtle key to gender empowerment in Japan.
In Japan, women nationwide buy chocolates for their male co-workers rather than husbands and loved ones (Lewis, 1995). With this custom, women have successfully monopolized the means of socially defining chocolate, which is a large promoter for the industry. Being a custom based on culture, chocolate sales in Japan on Valentine’s Day continue to increase as cocoa prices soar. It means that the duty is expanding, which could offer the new opportunities for an ethical fair trade choice in the region (Allen, 2011; Fletcher and Crawford, 2011). Thus, marketing to the Japanese based on custom rather than the individual consumer is advised.
3. Recommendation or choice of solution
Make a stand. What would you do as the International marketing manager for this company, based on an ethical platform? What are you going to recommend to the board?
First of all, Japan is a rapidly growing market where corruption is an issue. The stakeholders should be the focus, and holistic and corporate social responsibility marketing is a strategic consideration (Tae and Nakano, 2008; Tsalikis and Seaton, 2011). The chocolate company – Mars is recommended to use value-based labelling in order to increase consumer awareness of the brand. Moreover, individuals’ motivations from extrinsic social factors such as reputation-enhancing opportunities should be moulded around brand appearance and marketing strategy, which is rely on the product add value to the consumer thereby further building and maintaining the loyalty of the consumers (Fletcher and Crawford, 2011; McCall-Rosenbluth and Thies, 2011; Nicolas and Gittens, 2010). Secondly, a market-oriented solution is best for entering and marketing a fair trade chocolate brand in Japan, because Japan is a viable market to launch a brand, currently ranked third in world GDP (McCall-Rosenbluth and Thies, 2011; Tyler, 2012).
The chocolate company – Mars should consider about the ownership attributes, the location attributes and the internalisation for market entry (McElhatton, 2012). Mars could use the host marketers for the purpose of launching the market strategy from within the domestic environment. Furthermore, Mars could report the ethical practises to consumers which include ethical initiatives such as discontinuing marketing to children under age 12, and it is rely on brand integrity through Mars’ philosophy of “mutuality of benefits” for all stakeholders (Reed, 2007). It might offset distribution regulations and prevent ethical, legal and cross-cultural misunderstanding in brand marketing and promotion (Fletcher and Crawford, 2011; McCall-Rosenbluth and Thies, 2011).
Thirdly, Countries differ greatly in their ethical standards and consumer expectations (Tae and Nakano, 2008). In Japan’s political system, dominant economic interests caused deep changes, so in the other word, Japan is the very embodiment of stability (Tsalikis and Seaton, 2011). On the other hand, as approximately ten percent of sales are from the Australasian region, Mars success has resulted from a simply philosophy “go where the consumer economy is growing” and “the consumer is our boss.” (McElhatton, 2012; Tyler, 2012). Thus, the assessment predicts a minor political could impact of the new product brand and low transaction cost (Fletcher and Crawford, 2011).
Last but not least, Japan has greater equality of incomes between higher and lower incomes and market incomes (Kimura et al., 2012). This is ever more present as Japanese consumer social awareness grows and the distance is shortened between company and customer, due to communication advancements (McCall-Rosenbluth and Thies, 2011). The chocolate company – Mars could potentially take a large market segment by marketing a CSR strategy in this high-income country via differentiation (Allen, 2011). Besides, the growth of e-commerce has diminished national barriers, thus advertising campaigns directed at the Japanese market can be optimised online (Fletcher and Crawford, 2011; McElhatton, 2012).
Allen, L.L. (2011). Chocolate fortunes: the battle for the hearts, minds, and wallets of Chinese consumers. Retrieved from http://site.ebrary.com.ezp01.library.qut.edu.au/lib/qut/docDetail.action?doID=10342364 Castaldo, S., Perrini, F., Misani, N., & Tencati, A. (2011). The missing link between corporate responsibility and consumer trust: the case of fair trade products. Journal of Business Ethics, 84, 1-15. doi: 10.1007/s10551-008-9669-4 Fletcher, R., & Crawford, H. (2011). International marketing: an Asia-Pacific perspective 5th edition. Frenchs Forest, NSW: Pearson Australia. Kimura, A., Mukawa, N., Yamamoto, M., Masuda, T., Yuasa, M., Goto, S., Oka, T., & Wada, Y. (2012). The influence of reputational concerns on purchase intention of fair-trade foods among Japanese adults. Food Quality and Preference, 26(2), 204-210.