MBA 500 9-1 Project Three Submission Applying Legal and Ethical Frameworks

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School

Southern New Hampshire University *

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Course

500

Subject

Marketing

Date

Apr 3, 2024

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docx

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5

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MEMO To : Don Washington, Director of Marketing, Rewards Membership Alva Ramirez, Director of Sales, Rewards Membership Anne Hernandez, Chief Executive Officer From : Jessica Daniels – Sales and Marketing Consultant Subject : Addressing Legal Team Concerns on Low-Income Marketing and Sales Plan Executive Summary Recently the legal departments conducted a review of our proposal in which we would like to expand the rewards programs into the lower income communities. Through their memo they provided a legal requirement that that issued a cause for concern. The legal requirement was in regard to the collection of certain privacy data. In addition, there was an ethical concern which alluded to the direct marketing to the lower income populations. At this time, both of these issues need to be addressed in effort to move forward with the expansion. Addressing the Two Legal Requirements Truth in advertising: Analysis and recommendations According to the FTC, Federal Trade Commission, “Under the law, claims in advertisements must be truthful, cannot be deceptive or unfair, and must be evidence-based. For some specialized products or services, additional rules may apply”. When it comes to our proposal, there were certain ad lines that we could include in advertising the memberships to the new targeted audience. For example, the themes that are stated in the ‘ad lines” section mention
in the legal memo fail that test of the FTC’s requirements. These issues must be considered when rewriting our ads to avoid violating the FTCs requirements. The recommendation is to review the lines and update then to fit the requirements. An ethical concern that will arise as stated by the legal team is our slogan as it relates to charitable donations. The statement of “there is no better way to give”. Our ad lines need appeal and should remain interesting to the consumer. It does not provide insight into our rewards program or offers that we have. The new proposal of ad lines should be as clear as possible. An example of this can be to provide the actual percentage of membership sign-ups will be donated and to what said organizations. Lastly, to address the recommendations for transparency amongst the different tiers of loyalty programs, we should outline the difference in accrual of points that the members would receive per dollars spent. Data collection and privacy: Analysis and recommendations Majority of the legal concern surrounds the California Consumer Privacy Act. This exposed the fact that we are not limiting the data collection based on those rights. We would need to make sure that we are only taking relevant information, offering the option for our members to opt out of providing said information, and lastly consider the vulnerabilities that we face when it comes to our younger consumer base and the potential consumer base that we are attempting to expand to, the lower income population. It is crucial to implement necessary practices, so we do not lose a consumer base by making them feel forced to provide such information. The importance of reviewing and considering the CCPA will assist us in making sure that we are taking information that we actually need and not invading the privacy of our consumer.
Additionally, not making them feel forced to do so. One of the recommendations as it relates to under aged consumers, is to create a fun and child-like membership that only asks for them to provide their name and birthday to join. This membership would be completely free. They would still be able to accrue point and rewards, but they will not be able to pay for a regular loyalty membership. We can expand on the rewards of the point more in a later meeting however this is a start to making sure that we remain within legal requirements. Addressing the Three Ethical Concerns Direct marketing to low-income populations: Analysis and recommendations I wanted to make sure that we treaded carefully as discussing the lower income population can be tricky. With that being said, the main ethical concern as it relates to the expansion to the lower income population was the fact that if we are expanding it needs to be in a way that we are providing value to their lives. This involves communicating with them in a way they understand when we are marketing our product to them. We must really consider their backgrounds and what they may have faced. In other words, we do not want them to feel as though we are targeting them in effort to add to our consumer based. We want them to know that we value their business just as much as we do our other customers. In effort to not collect too much information and make these consumers feel like targeted, it is recommended that we provide them with tier that are appealing due to the cost without changing the benefits. This would involve possibly lowering the cost for all the members in such a way that profit remains the same with more memberships becoming appealing and our new members being able to reap some of the same benefits. Transparency in language: Analysis and recommendations
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