Marketing Ethics $450 Starbucks Gift Card Just in time for the holidays, Starbuc

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Marketing Ethics $450 Starbucks Gift Card

Just in time for the holidays, Starbucks offered the Limited Edition Medal Starbucks Card for $450, entitling the holder to $400 of Starbucks drinks, goodies, and gold-level Starbucks membership status. The other $50 was to cover the cost to make the steel card. Sounds crazy, doesn’t it? Well, the 5,000 super-premium cards, which could only be purchased at the luxury goods Web site Gilt.com, sold out within minutes. Then they popped up on eBay with opening bids starting at $480 and one selling for $1,000! The premium cards are refillable, allowing the owner elite exclusivity. Some criticized Starbucks, claiming it is a card “for the 1 percent” and saying it is “all about status” and that holders of the premium card have something others don’t. Starbucks also rolled out a pricey brew for the other 99 percent, charging $7 a cup.

7-10. What is it about Starbucks that the company could sell a gift card for $50 more than the $400 in merchandise the card could purchase? Should a brand be allowed to do that? (AACSB: Written and Oral Commun

Marketing Ethics Don’t Say That!

If you like a restaurant . . . Yelp about it! If you don’t . . . Yelp about it! Yelp is an online guide that posts customers’ reviews of local businesses such as restaurants, spas, and even doctors. Businesses are rated based on the reviews posted about them, with a 5-star rating being the best. Although almost 60 percent are 4- or 5-star reviews, the remaining reviews are less positive. Bad reviews can be the kiss of death for a small business. Businesses do not put this information on the Yelp site—others do. This is creating a problem for many businesses. Some customers demand something in return for posting a positive review, or worse, for not posting a negative review. One restaurant owner claimed a customer threatened to post a “scathing” review after allegedly getting food poisoning from eating at the restaurant unless he received a $100 gift card. This is not much different than the unethical customers who put glass shards or a dead cockroach on their plates and demand their meal for free (conveniently when they’ve almost finished the dish). Most restaurants capitulate to avoid a scene. But a negative Yelp or other online review is more ominous, with “word-of-mouse” having such far-reaching and lasting consequences. Some medical professionals have gone so far as to require new patients to sign anti-defamation contracts called “medical gag-orders” before receiving treatment. These waivers attempt to prevent patients from posting negative reviews online and often include signing over copyrights of any reviews posted in an attempt to gain leverage in removing any negative content from rating sites. Some sites, such as Angie’s List, flag physicians requiring such waivers, and one state—Michigan—has introduced a bill deeming such waivers illegal.

12-10. Visit Yelp and other sites such as Angie’s List, RateMDs.com, and Rate My Professor. Are reviewers limited in any way regarding what they can say on such sites? Should they be limited? (AACSB: Written and Oral Communication; Ethical Understanding and Reasoning; Reflective Thinking)

ication; Reflective Thinking; Ethical Understanding and Reasoning)

7-11. How has Starbucks positioned its brand? Could this premium gift card offer or $7 cup of coffee harm Starbucks’ brand image? (AACSB: Written and Oral Communication; Reflective Thinking)

Explanation / Answer

Answer 12.10:

After visiting Yelp, Angie’s List, RateMDs.com and Rate My Professor; I have determined that reviews of reviewers are limited in way what they can say on such sites. These sites employ filters. So that the language and reviewing patter can be within the allowed limits.

It is important to limit the reviews in my opinion as the negative reviews endanger the business reputation and brand names. And some unethical customers take undue advantage of such websites. However, I find this process unethical.

Answer 12.11:

I find Doctors’ rights to require medical gag-orders partially justified. As negative comment on these famous reviewing websites case severe harm to doctors reputation. However, it is the duty of patients to inform others about the quality of treatment given by the doctor. The use of such websites is justified as long as reviews provided are ethically correct and morally justified.

Doctors can handle this situation by being more generous and genuine while treating a patient. And avoiding situations that can create conflict and spoil their reputation.

Answer 7.10:

In order to attract high income consumers Starbucks have offered the Limited Edition Medal Starbucks Card. This strategy have acted as a promotional strategy for the brand. The brands must be a allowed to do that as there is nothing unethical in it.

Answer 7.11:

Starbucks have positioned its brand for targeting higher income consumers by offering Limited Edition Medal Starbucks Card. They offered the card for $450.

This strategy of premium gift card offer or $7 cup of coffee can harm Starbucks’ brand image. As the differentiation of customer based on the status is ethically not justified. This strategy can lead the company in ruining its brand name.

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