What three or four ethical issues do you think marketing analysts or marketing managers who deal with analytics face most often?

Thesearebravenewtimesthatwelivein,becausetheamountofinformationthat'sfloatingaroundoutthereisincreasinglikeneverbefore,andit'salreadyprettyvast.Butmoreimportantly,whenyoustopandthinkaboutit,youeverwonderhowmuchinformationaboutyouisactuallyoutthere,andwhatpeoplelikemarketersknowaboutyouandwhatyoudoandwhereyougoandthethingsthatyoubuy?

Well,theanswerisactuallyquitealot.Andthatcreatessomeethicalquestionswithrespecttomarketinganalyticsandtheuseofdataintermsofanalyzingthingsaboutpeople,especiallywhenthoseindividualscanbeidentifiedindividuallyorspecifically.Butmorethanthat,ethicaluseofanalyticsalsoincludestheresponsibleuseofresultsthatwegetfromthedatathatwecollect,becausesometimesthoseresultscanbe,well,misleading.

MarkTwainoncesaid,"Therearethreekindsofpeople.Thereareliars,therearedamnedliars,andthere arestatisticians."Well,Iwanttoavoidthat,atleastinallofyou.Sowe'regoingtobetalkingaboutsomeoftheissuesassociatedwiththeethicaluseofanalytics.Butmoreimportantlythanthat,we'regoingtobetalkingaboutcreatingyourownlittletoolkitformakinggood,sound,ethicaldecisions,doingitinthecontextofmarketinganalytics,butinwaysthatextendbeyondthislimitedusetoanyfacetoflife.

Becausebelieveitornot,thereisahugeacademicandpsychologicalliteratureonethicaldecision-making.Andit'staughtusafewthingsabouthowpeoplemakeethicaldecisions.Andindoingthat,it'salsogivingussomeguidelinesortoolkitsthatwecanusetofollowwhenweareanalyticalaboutethicaldecision-makinginthesamewaythatwemightbeanalyticalaboutmakingmarketingdecisions.Solet'stalkaboutthat.

Firstofall,let'sputthingsincontextandtalkabouttheneedforethicsandanalytics.Andpartofitisbecause,well,firstofall,marketingdecisionsareactuallyveryconsequential.Nowthevastmajorityofmarketingdecisionsthatyoumakeindividuallyareprobablynotthatbigadeal.You buyacanofgreenbeans.Youbuyapairofshoes.Youknow,thatseemslikenobigdeal.

Butwedomakealotofindividualpurchasesthataffectlifeandhealthandwell-being,whetherit'sbuyingproductsthataredangerous,whetherit'sbuyingproductsthatendangernotonlyourlives,butthelivesorwell-beingofotherpeople,butalsoproductsthatmayhavelong-termconsequencesintermsoftheiruse--forexample,thingslike,I don't know,tobaccouse.Thesearethingsthathavelong-termconsequences,eveniftheirimmediateconsequencesaren'tnecessarilyfelt.

Soindividualpurchasesthatyouandotherpeoplemakedohaveethicalovertonestotheminthesensethattheydoaffectthelifeandhealthandwell-beingofyourselfandothers.Butmorethanthat,also,marketingdecisionscarryhugeconsequencesintermsofthelevelofeconomicactivitythattheyinfer.Oureconomyrunsonexchange.

Nomatterhowmucheconomiststalkaboutsupplyanddemandandcostsandmarginalcostsandsoonandsoforth,thefactofthematteristhateverysingleoneofthoseeconomicmetrics,andeverysingleoneofthosecurvesthatyoumayhavelearnedinyourvariouseconomicsclasses,hasbehindittheideathatanexchangetookplacesomewherealongtheline,whereconsumersboughtsomethingandmarketersorbusinessessoldsomething.Anditwasthatexchangethatproducesthedatapointthatservesasthebasisfortheanalysisofeconomicbehavior.

Ifwestoppedexchanging,oureconomywouldgrindtoanabsolutehalt.Andsothethingsthatwedowhenwepurchasethings,eventhoughtheydon'tseemverybigorconsequentialinthemoment,onanygivenday,theyaddup.Andsohowweasmarketersusedatatocreatepurchasesaboutthatinfluencehowpeoplespendtheirmoneycanhavehugeeconomicimpactsovertime.Sotheuseofmarketinganalyticsisindeedconsequentialwithrespecttobothindividualaswellasoveralleconomicsortsofconsequences.

Secondly,I'vementionedallalongthatoneofthereasonsforthiscourseisthatmarketingdecisionsareincreasinglydatadriven.Thebestmarketersintheworldnolongerflybytheseatoftheirpants.Thebestmarketersintheworldareinformedaboutthethingsthattheydo.Andthebiggestcompanieswiththemostsuccessfulmarketingprogramsinsistthattheirmarketingmanagersusedataasthebasisofthedecisionmakingthattheyhave.

Somarketingdecisionsareincreasinglydatadriven,andthat'snotgoingtochange.Aswestarttoincreasetheamountofdatathatweproducejustasamatterofourdigitalactivities,alongwitheverythingelse,thatinformationisgoingtoserveastheinputtomoreandmoresophisticatedanalytics.Andthey'regoingtoberequiredbyworld-classmarketers.Thiskindofdataanalysisisnolongeranoption.Itreallyisincreasinglybecomingarequirement.

Theuseofanalyticsisalsoatleastasmuchartasitisscience.Inotherwords,atthisparticularpoint,whatwetrytodoisreducetheuncertaintywithrespecttoourdecision-makingasmarketingmanagers.Andtheroleofintuitionandinstinctisstillpresent,butperhapsitissomewhatdiminished.Butthereisstilltheart.

IfIhavedataanalyticsthattellmethatsomethingismorelikelytohappenthansomethingelse,thatmayimplytomecertainkindsofoptionsthatIhaveatmydisposal.Thequestionis,amIanygoodatpickingtherightoption?AmIanygoodatexecutingonthatrightoption?Sothereisstillasmuchartandsciencetofollowingtheleadofanalyticsaswemovethroughdatatowarddecision-makingandtowardmarketingstrategy.Alotofdatascienceinvolved,butithasn'tcompletelyreplacedorsupplantedthenotionofintuitionandinstinct.

Sotheanalysis,then,ofthesamedatacansometimesproducedifferingresults.Soforexample,ifI'mlookingatafieldexperimentversusalabexperiment,orifI'musingoneformofregressionversusanotherformofregressiononthesamedataset,it'sgoingtoproducedifferentresults.DoIknowwellenoughtofollowthedifferentresultsandunderstandthedifferencebetweenthem?

Morethanthat,too,thepresentationofthesameresultscanarriveatdifferentconclusions.SoIcanpresenttheresultstotwodifferentpeoplethesameway,andtheymaytaketwodifferentthingsawayfromthem.Andfinally,theinterpretationofthesameconclusioncanproducedifferentmarketingstrategiesandtactics.Sothereisartinvolvedtoit.

Thepointtoallofthisisthis,thatevenaswetrytotakethehumanelementoutofalotoftheanalyticsanda lotofthestatisticalanalysisthatwehave,thefactofthematteristhattherearegoingtobehumanelementsinvolvedwithourdecisionsasmarketingmanagers.Andthosedecisionsaregoingtoaffect,potentially,thelife,health,andwell-beingofthepeoplewhobuyourproductorevenwhodon'tbuyourproduct.Butalso,thelevelofeconomicactivityontheaggregateisalsogoingtobeaffectedbythosedecisions.

Therefore,wehavealotofethicalovertonestothethingsthatwemightdo,notonlyfromcollectingdata,butalsofromusingthosedata.Soweasmarketinganalystshaveaspecialobligationtohandletheinformationeffectively,toanalyzetheinformationeffectively,andtopresentthe informationeffectively.Andbyeffectively,Ialsomeannotinwaysthatsimplymaximizeprofit,butalsowaysthatreflectgood,sound,ethicaljudgmentinawaythatweunderstandtheresponsibilityofthethingsthatwearedoing.

Nowinthecomingsetsofslidesthatwe'regoingtolookat,we'regoingtolookatethicsfrom a varietyofdifferentangles.We'regoingtotalkaboutamodelofethicaldecision-makingandsomeempiricalresultsthatsupportthebasiccontentionsofthatmodel.Intheend,whatIwantyoutowalkawaywithisatoolkitthatsays,here'showIanalyzeethicaldecisions,andthenalso,anincreasedsensitivitytothepossibleethicaldecisionsthatyoufacethatyoumaynotevenknowyetthatyoudo.Andthatbecomesanimportantpartofethicaldecision-makingandethicalbehavioraswell.

SowehavealotofgroundtocoveronwhatIthinkisaparticularlyinterestingtopic.Oneofthereasonsthatresearchonethicsissointerestingisbecauseitdoescarrythismoralovertonetoit.Andsoaswethinkaboutourownethicalchoicesanddecisionsandapplythemtothedataandtheresearchthathasbeenconductedonit,itseemstobeespeciallyinterestingtopeople.AndIhopeitisforyou,too.Sowe'regoingtostartlookingatthosedifferentdimensionsofethicaldecision-makinginthecontextofmarketinganalytics,aswellasoutsideofthatcontextaswemoveforward.