Branding tells people about your product or service. However, the aggressive competition that exists in the world of business sometimes clouds the boundaries between what is questionable and what is ethical.
Effective branding may have a short-term effect of getting customers excited about a product and wanting more. However, if there is no ethical dimension to a branding strategy, the long-term consequences can be dire and counter-productive.
The key to long-term success in branding your product or service is to create a code of ethical principles that your organisation will always adhere to. Customers, stakeholders and stockholders will then associate these ethical values with your organisation.
To ensure that there is an ethical dimension to your branding strategy, you and your organisation should consider the following issues:
There are case studies of multinational companies in America and Europe who whip up excitement for their products and services through aggressive advertising strategies. These may make exaggerated claims about a product’s effectiveness.
When too much money is spent on such advertising and marketing at the expense of research and development, the long-term sustainability of the product and business will be compromised.
Deceptive branding will not work in the long run. Your organisation will lose the trust and confidence of its customers, and its credibility will suffer.
The dangers of ethical relativism
The simplest definition of ethical relativism is that ethical values and judgments depend to a large extent on one’s culture, society or personal perception of the way things should be.
In other words, there is no absolute standard of right and wrong, and whatever is acceptable to the majority is considered as acceptable and good practice even if it is considered unethical by a few.
For example, to save on labour costs, an organisation secretly hires children who are willing to work for lower wages. It is naive to think the practice is acceptable just because the management and the majority of staff think it is.
International labour rights groups, child protection agencies and customers alike will be outraged by what they consider child exploitation. Think of the fallout from such negative publicity on that organisation, its brand and its products.
To become a global organisation, a company must operate according to internationally accepted ethical standards. Then, it has to get its people to believe in the brand promise and embrace these ethical standards.
The reliability principle
Working within an ethical dimension also means delivering on reliability. You earn your customers’ trust and loyalty by honouring your commitments to them. This also means that your employees are clear about their commitment to the company and its customers, and are able to deliver on the company’s brand promise.
The “fish rots from the head” principle
Effective ethical branding is only possible if the key policy makers of the organisation act according to the agreed code of ethics.
Having a fantastic brand and a good mission statement is only part of a larger and complex equation. Every person, from the chief executive officer down, has to be committed to the ethical dimension in the company’s branding strategy.
Consider Enron, the American scandal-hit multinational that collapsed. The company had a powerful code of ethics, but the people at the top were not practising it.
There is no panacea to address every ethical issue and dilemma that a company will face. But an organisation’s real road to success lies in its ability to work within an ethical dimension, which will equip its leaders to take the right course of action — one that enhances the brand and enables the company to achieve long-term sustainability.