Bad Business Ethics or Acceptable Promotional Perks?

By Jessica Silliman

Gail Ellen had taken her first job offer out of Santa Clara University. As a communication major, she hoped to go into broadcast media and eventually become an on-air personality. But she knew she had to work her way up. So she took a job with a local Bay Area radio station in the publicity department. Gail immediately fell in love with the station's young, hip vibe.

Soon after beginning at the radio station, Gail began to feel uncomfortable about some of the practices within the promotions department. When station officials requested products from local companies to be given away on-air, they would overestimate the amount necessary. The employees would then take the extra products.

This happened several times with tanning packages. A local tanning salon would often donate coupons for free one-month trials. The station didn't have a set ratio for coupon dollar amount per minute of advertising, so the promotions department would negotiate individually with each customer. It was also impossible for the individual companies to keep track of the on-air advertising time, so they never knew if their negotiated airtime was actually in effect. These negotiations resulted in a completely arbitrary system that always erred on the side of the station. Instead of giving all the tanning packages away on the air, the disc jockeys would often keep a few for personal use, or distribute them to other station employees.

Because everyone at the station enjoyed receiving the perks, nobody complained. "I enjoyed the industry," said Gail. "I'm just glad I wasn't on the other side of the street." Gail realized that the supporting companies donating give-aways had no idea of the radio station's practices. This frustrated her, but she, too, didn't feel it was worth speaking up about. "I was getting a horrible salary, so I figured I could enjoy the perks," she said. "Plus, they were on such a small scale, that it didn't seem significant."

"This was just how the business operated, so I didn't say anything," said Gail. "It was just part of the culture."

This article struck me as pretty shady business practices.  In the article she says that the perks “were on such a small scale, that it didn't seem significant."  I’m sure that to her it did not seem significant since she was the one receiving the so-called “perk.”  Imagine, however, that you are one of the companies providing the promotion in exchange for advertising on the radio.  You give the radio station deals that your normal customers would not receive as prizes to radio games.  Your objective with the deals is that once someone wins the prize not only will they use the deal but become a repeat customer.  If your deals are instead being used by radio station employees and they are just using the deal, then your advertising dollars are basically being wasted.  You might as well just give the station’s employees money.  While this may not seem significant to the station employee, it is very significant to a small company who only advertise on the radio.  In the article, Gail herself even says, “I'm just glad I wasn't on the other side of the street."  Even she realizes that it is the wrong thing to do but she would not speak up because everyone else was doing the same thing.

Posted by: David Ashbeck