A few years ago, one of the largest and well-known mobile providers, AT&T, was involved in unethical and illegal mobile marketing practices. The company was involved in something called mobile cramming. AT&T had “third-party charges added to their customer’s mobile bills without their consent,” (Katz, 2016).
The negative consequences that the consumers of AT&T experienced was a loss of money (up to $31) and also the possibility of being stuck in a long-term contract with a very well-known company, who had betrayed their trust. When a customer signs a contract with any business, there is always a possibility that something bad can happen when handing over personal financial information. In this case, AT&T had access to their bank account details and added unnecessary charges to the customer’s bill. However, when signing a contract with this company, especially while providing their account information, it is secured under the Act on the Protection of Personal Information which was fully enacted in 2005.
The possible penalties levied on a company for violating legal considerations can range from something small such as refunding the money ($88 million), that they stole from their customers as AT&T did, all the way to the co-founder and board members stepping down from their position and fired from their film company, who had distributed over 80 Oscar-winning films, The Weinstein Company (Stebbins, Comen, Sauter &Stockdale, 2018). The penalties against a business may also be dependent upon the type of violation that was committed. There is the probability of having to pay for losses caused, damages caused, in product-related violations, they may have their products confiscated and subject to additional fines, criminal violations, the loss of their business license, and civil charges (Rivera, 2018).
The kind of actions that a marketer must take, with any mobile marketing campaign to remain ethical starts with their honesty with the customer. All marketing decisions should comply with all regulations and standards that are established by the government and the customer’s privacy shall be protected at all times with their permission asked by the company to send marketing information. All things promised to the customer/consumer should be upfront and on the table when released to the news or through media accounts. Although unethical advertising is not against the law, it is the marketer’s job to remain an ethical employee and help promote the company campaign in an ethical way. If someone were to discover and point out unethical practices, there could be consequences for the company’s reputation. The goal is to remain in good standing under the public eye so that business continues to grow and move forward with the customers that they have.
Sources:
Katz, M. J. (2019, May 23). FTC Providing Over $88 Million in Refunds to AT&T Customers Who Were Subjected to Mobile Cramming. Retrieved August 10, 2019, from https://www.ftc.gov/news-events/press-releases/2016/12/ftc-providing-over-88-million-refunds-att-customers-who-were
Marketing-Schools. (2012). Ethical Marketing: What is Ethical Marketing? Retrieved August 11, 2019, from https://www.marketing-schools.org/types-of-marketing/ethical-marketing.html
Rivera, J. (2018, May 18). Business Sales and Marketing Violations. Retrieved August 11, 2019, from https://www.legalmatch.com/law-library/article/business-sales-and-marketing-violations.html
Stebbins, S., Comen, E., Sauter, M. B., & Stockdale, C. (2018, February 12). Bad reputation: America’s Top 20 most-hated companies. Retrieved August 11, 2019, from https://www.usatoday.com/story/money/business/2018/02/01/bad-reputation-americas-top-20-most-hated-companies/1058718001/
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