Project 3

.docx

School

Southern New Hampshire University *

*We aren’t endorsed by this school

Course

500-C

Subject

Marketing

Date

Jan 9, 2024

Type

docx

Pages

Uploaded by PresidentFireElephant52

MEMO To : Don Washington, Director of Marketing, Rewards Membership Alva Ramirez, Director of Sales, Rewards Membership Anne Hernandez, Chief Executive Officer From : Matilda Mackenzie, Internal Consultant Subject : Addressing Legal Team Concerns on Low-Income Marketing and Sales Plan Executive Summary In response to our community outreach proposal, the legal team has raised legal and ethical concerns that need to be addressed before we move forward. These concerns are related to truth in advertising and data collection and privacy laws, as well as three ethical concerns pertaining to marketing to low- income populations, transparency in language, and collection of consumer data. In this memo, I will address each of these concerns and provide recommendations that meet legal requirements. At the end, I will explain how these recommendations support ABC Beauty’s vision, mission, and values. Addressing the Two Legal Requirements Truth in advertising According to the Federal Trade Commission, failure to adhere to the guidelines related to the Truth in Advertising Act can lead to hefty repercussions for advertisers, regardless of the advertising method used ( Truth in Advertising , 2021.) For this reason, our legal team has asked that we revise our ad lines so that statements about the program benefits are clear and specific, the information in our commercials is honest and easy to understand, and we avoid making claims that our brand is better than

others unless we have proof to support our claims. This issue takes place in the “Ad Lines for the Marketing and Sales Campaign" section of the proposal. Recommendation My recommendation for the legal requirement that “ABC Rewards Membership marketing materials must meet these requirements drawn from our interpretation of the law” is that we revise the language in our ad lines and omit any phrases that imply superiority and replace them with terms that still convey our brand’s excellence. Two ad lines that include language implying superiority are “there is no better way to give” and “the best way to help your neighbor is to help yourself to our loyalty membership.” These phrases can be substituted to say, “a thoughtful way to give” and “help your neighbor and yourself by joining our loyalty membership.” Doing this would address all three benchmarks by ensuring that our statements are clear, specific, honest, and easy to understand without comparing the brand to its competitors. Data collection and privacy Due to this being a national program, the legal team has reminded us that we must comply with laws stated in the California Consumer Privacy Act of 2018 (CCPA), which includes the country’s most restrictive laws related to data collection and privacy. To remain in compliance, we must ensure that our consumers have the following rights:  The right to know about the personal information collected about them and how it is shared and used  The right to delete personal information collected from them  The right to opt out of the sale of their personal information  The right to non-discrimination for exercising their privacy rights (Bonta & State of California Department of Justice, 2023.)

This issue takes place in the Sales and Implementation portion of the proposal which aims to collect data from new customers through the membership application. It also takes place in the section of the proposal relating to Community Incentives which would require the company to track “the type of purchase made” and associate it to the neighborhood where the customer lives. An additional concern posed by the legal team is our marketing to children under the age of 18. Minors are unable to make contractual obligations and collecting data from children may put the company at risk of backlash from parents, guardians, and schools which are required to protect the data and privacy of all students. Data collection of minors takes place in several places throughout the proposal. In the section related to reaching the target market, the proposal aims to reach minors by partnering with schools and naming school ambassadors. In the Selling and Implementing section, parents are asked to provide sensitive information such as the names of their children and their birthdates. Lastly, this issue takes place in the section, Community Incentives, which would require identifying information for minors to be collected along with the school they attend. Recommendation My first recommendation for ensuring “compliance with the most restrictive laws on data collection and privacy” is that we ensure that clients are aware of their rights and informed about how their data is being used. During the application process, customers can be given a separate brochure which describes the ways that their information will be used and given the opportunity to request more information from the sales representative if they need further clarification. Customers must be asked to provide a signature stating that they have read or listened to a description of how their data will be used and they are aware of the ways that they can opt out at any time. Additionally, each time customers make a purchase they can be prompted with a question similar to “would you like to share information from this purchase to help us give points back to your local community?” This would address the legal

requirements that we must “ensure we are not collecting any more data than is needed” and “make it convenient and accessible for consumers to opt out of data sharing. “ My recommendation for the legal concern related to “marketing [the] program in high schools to children under the age of 18” is to omit the part of the proposal that specifically targets high school students, and instead aim to reach their parents. At that age, parents are still financially responsible for their children and are likely footing the bill for their shopping expenses. Rather than asking for specific details about their children, all adults can still be given the option for their points to go towards local schools without disclosing information such as the name, age, birthday, or school of their child. This would also remove the liability from schools for disclosing the data and privacy of their students. Additionally local store fronts can still implement school branding with purchases such as reusable totes with school logos that shoppers can buy, and the points earned will give back to the associated school. This would address the legal requirement to “come up with an alternative approach that does not require the kind of membership that students under 18 must purchase and that they must share sensitive data to use.” Addressing the Three Ethical Concerns Direct marketing to low-income populations An ethical concern posed by the legal team relates to the population we are targeting. Due to their socio-economic status, it is imperative that our rewards program is valuable to them and does not increase the disparity. One issue outlined by the legal team is that typically, the cost incurred by paying for a membership outweighs the amount of rewards that a member redeems. The introduction to the proposal and Considerations of the Target Market shows that our target population makes less than $50,000 per year, whereas our current, average member has an income of $85,000 per year. This shows that the cost of the membership will be a much greater investment for low-income members compared

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