Thursday, April 6, 2017

OUGD505 - Studio Brief 2 - Government News Articles & Statistics Research

In recent years, the food and beverage industry in the US has viewed children and adolescents as a major market force. As a result, children and adolescents are now the target of intense and specialized food marketing and advertising efforts. Food marketers are interested in youth as consumers because of their spending power, their purchasing influence, and as future adult consumers. Multiple techniques and channels are used to reach youth, beginning when they are toddlers, to foster brand-building and influence food product purchase behavior. These food marketing channels include television advertising, in-school marketing, product placements, kids clubs, the Internet, toys and products with brand logos, and youth-targeted promotions, such as cross-selling and tie-ins. Foods marketed to children are predominantly high in sugar and fat, and as such are inconsistent with national dietary recommendations. The purpose of this article is to examine the food advertising and marketing channels used to target children and adolescents in the US, the impact of food advertising on eating behavior, and current regulation and policies.


Nutrition during childhood and adolescence is essential for growth and development, health and well-being. Further, eating behaviors established during childhood track into adulthood and contribute to long-term health and chronic disease risk. Numerous studies have consistently documented that dietary intake patterns of American children and adolescents are poor and do not meet national dietary goals. In addition, US food consumption trend data show a shift over the past few decades. Children and adolescents are eating more food away from home, drinking more soft drinks, and snacking more frequently. American children now obtain over 50% of their calories from fat or added sugar (32% and 20%, respectively).
The growing epidemic of childhood overweight and obesity is a major public health concern. Currently 15% of US youth are overweight, a prevalence nearly twice as high in children and three times as high in adolescents compared to 1980 prevalence rates. Almost two-thirds (60%) of overweight children have at least one cardiovascular risk factor (e.g., hypertension, hyperlipidemia) and the prevalence of type 2 diabetes mellitus is increasing in youth. These trends may seriously compromise the future health and productivity of the US population and add to health care costs.
While multiple factors influence eating behaviors and food choices of youth, one potent force is food advertising. Today's youth live in a media-saturated environment. Over the past 10 years, US children and adolescents have increasingly been targeted with intensive and aggressive forms of food marketing and advertising practices through a range of channels. Marketers are interested in children and adolescents as consumers because they spend billions of their own dollars annually, influence how billions more are spent through household food purchases, and are future adult consumers. It is estimated that US adolescents spend $140 billion a year. Children under 12 years of age spend another $25 billion, but may influence another $200 billion of spending per year.
The purpose of this article is to examine the food advertising and marketing channels used to target US children and adolescents, the impact of food advertising on eating behavior of youth, and current regulation and policies. The emphasis of this article is on food advertising and marketing practices in the United States.


Food Advertising
Advertising is central to the marketing of the US food supply. Marketing is defined as an activity an organization engages in to facilitate an exchange between itself and its customers/clients. Advertising is one type of marketing activity. The US food system is the second largest advertiser in the American economy (the first being the automotive industry) and is a leading buyer of television, newspaper, magazine, billboard, and radio advertisements. The reasons that the food advertising market is so large include the following: 1) food captures 12.5% of US consumer spending and so there is vigorous competition, 2) food is a repeat-purchase item and consumers' views can change quickly, and 3) food is one of the most highly branded items, which lends itself to major advertising. Over 80% of US grocery products are branded.
Advertising expenditures for US food products were $7.3 billion in 1999. In 1997, the US advertising expenditures for various foods were: breakfast cereals – $792 million; candy and gum – $765 million; soft drinks – $549 million; and snacks – $330 million. Total expenditure for confectionery and snacks was $1 billion. In contrast, during the same year, the US Department of Agriculture spent $333 million on nutrition education, evaluation, and demonstrations. Advertising budgets for specific brands of foods, beverages, and fast food restaurants are also revealing. It is unclear how much money is spent on food advertising specifically directed at children and adolescents, but estimates are available for overall youth-oriented advertising in the US. It is estimated that over $1 billion is spent on media advertising to children, mostly on television. In addition, over $4.5 billion is spent on youth-targeted promotions such as premiums, sampling, coupons, contests, and sweepstakes. About $2 billion is spent on youth-targeted public relations, such as broadcast and print publicity, event marketing, and school relations. In addition, roughly $3 billion is spent on packaging especially designed for children.

Annual Advertising Budget for Products/Brands of Food and Beverages in the US, 2001

The heavy marketing directed towards youth, especially young children, appears to be driven largely by the desire to develop and build brand awareness/recognition, brand preference and brand loyalty. Marketers believe that brand preference begins before purchase behavior does. Brand preference in children appears to be related to two major factors: 1) children's positive experiences with a brand, and 2) parents liking that brand. Thus, marketers are intensifying their efforts to develop brand relationships with young consumers, beginning when they are toddlers. Marketers know that toddlers and preschool children have considerable purchase influence and can successfully negotiate purchases through what marketers term the "nag factor" or "pester power". A child's first request for a product occurs at about 24 months of age and 75% of the time this request occurs in a supermarket. The most requested first in-store request is breakfast cereal (47%), followed by snacks and beverages (30%) and toys (21%). Requests are often for the brand name product. Isler, et al, examined the location, types, and frequency of products that children ages 3-11 requested of their mothers over 30 days. Food accounted for over half (54%) of total requests made by children and included snack/dessert foods (24%), candy (17%), cereal (7%), fast foods (4%), and fruit and vegetables (3%). Almost two-thirds (65%) of all cereal requests were for presweetened cereals. Preschool children made more requests than the older elementary school children. Parents honored children's requests for food about 50% of the time, soft drinks (60%), cookies (50%), and candy (45%). These findings show that food advertisers spend large amounts of money targeting children, in an attempt to build brand loyalty and to persuade them to desire a particular food product, starting when they are toddlers.
Central to any discussion on food advertising to children is the nature of children's comprehension of advertising. Numerous studies have documented that young children have little understanding of the persuasive intent of advertising. Prior to age 7 or 8 years, children tend to view advertising as fun, entertaining, and unbiased information. An understanding of advertising intent usually develops by the time most children are 7-8 years old. Because of their level of cognitive development, children under 8 years of age are viewed by many child development researchers as a population vulnerable to misleading advertising. The heavy marketing of high fat, high sugar foods to this age group can be viewed as exploitative because young children do not understand that commercials are designed to sell products and they do not yet possess the cognitive ability to comprehend or evaluate the advertising. Preteens, from ages 8-10 years, possess the cognitive ability to process advertisements but do not necessarily do so. From early adolescence (11-12 years), children's thinking becomes more multidimensional, involving abstract as well as concrete thought. Adolescents still can be persuaded by the emotive messages of advertising, which play into their developmental concerns related to appearance, self-identity, belonging, and sexuality.

Marketing Channels

Multiple channels are used to reach youth to foster brand-building and influence food product purchase behavior. Youth-oriented marketing channels and techniques include television advertising, in-school marketing, product placements, kids clubs, the Internet, toys and products with brand logos, and youth-targeted promotions, such as cross-selling and tie-ins. The channels used to market food and beverages to youth are described below.

Television advertising
The largest single source of media messages about food to children, especially younger children, is television. Over 75% of US food manufacturers' advertising budgets and 95% of US fast-food restaurant budgets are allocated to television. Television viewing starts early, US children between the ages of 2 and 4 years view 2 hours of television daily; this increases to over 3.5 hours near the end of grade school, then drops off to about 2.75 hours in later adolescence. US children in low-income families and minority youth tend to watch more television. Thus they have greater exposure to food ads.
It is estimated that US children may view between 20,000 – 40,000 commercials each year and by the time they graduate from high school may have been exposed to 360,000 television ads. Food is the most frequently advertised product category on US children's television and food ads account for over 50% of all ads targeting children. Children view an average of one food commercial every five minutes of television viewing time, and may see as many as three hours of food commercials each week. In a descriptive study that examined US food advertising during 52.5 hours of Saturday morning children's programming, 564 food advertisements (57% of all ads) were shown. On average, 11 of 19 commercials per hour were for food. Of these ads, 246 (44%) promoted food from the fats and sweets group, such as candy, soft drinks, chips, cakes, cookies and pastries. Fast-food restaurant advertising was also prevalent, comprising 11% of total food advertisements. The most frequently advertised food product was high sugar breakfast cereal. There were no advertisements for fruits or vegetables. Several other studies have documented that the foods promoted on US children's television are predominantly high in sugar and fat, with almost no references to fruits or vegetables. The food advertised on US children's television programming is inconsistent with healthy eating recommendations for children.
An international comparative survey of television advertising aimed at children was recently conducted by Consumers International, a non-profit organization consisting of a federation of consumer organisations. Television advertisements were monitored during approximately 20 hours of children's programming in 13 countries during a 3-month period in 1996. The 13 countries included Australia, Austria, Belgium, Denmark, Finland, France, Germany, Greece, Netherlands, Norway, Sweden, United Kingdom and the USA. The findings showed that Australia, US and UK had the most food advertisements, between 10 and 12 an hour or about 200 in a 20 hour period. This was twice as many advertisements as in Denmark, Germany and France, and between 6 to 10 times more than in Austria, Belgium and Sweden. The least amount of food advertising was in Sweden, which had almost no food advertisements (<1 ad/hour). Food products comprised the largest category of all advertisements to children in virtually all countries. In two-thirds of all countries food advertisements accounted for more than 40% of total advertisements. Confectionery, breakfast cereals (mainly sweetened), and fast food restaurants accounted for over half of all food advertisements. Confectionery was the largest category accounting for nearly a fifth of all food advertising. A nutritional analysis conducted for the advertised foods in the UK found that 95% of the ads were for foods that were high in fat (62%), sugar (50%) or salt (61%). The results from this study indicate that the advertising of high fat/high sugar foods to children is an international issue.

In-school marketing
During the past decade in the US, use of public schools as advertising and marketing venues has grown. Reasons for the increase in in-school marketing to children and adolescents include the desire to increase sales and generate product loyalty, the ability to reach large numbers of children and adolescents in a contained setting, and the financial vulnerability of schools due to chronic funding shortages. In-school commercial activities related to food and beverages include 1) product sales; 2) direct advertising; 3) indirect advertising; and 4) market research with students. Examples of these four types of marketing practices used in schools are shown in the table below.


In a recent report by the US General Accounting Office (GAO), food sales were reported to be the most prevalent form of commercial activity in schools. Food sales involved primarily the sale of soft drinks from vending machines and short-term fundraising sales. The US national School Health Policies and Programs Study 2000 (SHPPS) found that students could purchase soft drinks, sports drinks, or fruit drinks that are not 100% juice in a vending machine, school store, or snack bar in 58% of elementary schools, 83% of middle schools, and 94% of high schools. In a recent survey of 336 secondary school principals in Minnesota, US, 98% of the school principals reported that soft drink vending machines were available to students, and 77% of the schools had a contract with a soft drink company. The GAO report found that the sale of soft drinks by schools or districts under exclusive contracts is the fastest growing activity of all product sales. Nationally in the US, more than one-third of elementary schools, half of middle/junior high schools, and almost three-fourths of senior high schools have a contract that gives a company rights to sell soft drinks at schools. Most (92%) of these schools receive a specified percentage of the soft drink sales revenues and about 40% receive incentives such as cash awards or donated equipment once revenues total a specified amount. The contract terms vary greatly, but many are highly lucrative. For example, a beverage contract with one US school district has the potential to generate up to $1.5 million per year. Contracts may also specify advertising of their products. SHPPS found that in 35% of school districts with soft drink contracts, the company is allowed to directly advertise in the school buildings; 43% allow ads to be placed on school grounds, outside of school buildings, or on playing fields.
There is also a growing trend of fast food vendors in schools. About 20% of US high schools offer brand-name fast foods, such as Pizza Hut, Taco Bell, or Subway. The results from the 2000 California High School Fast Food Survey conducted in 171 US school districts with 345 public high schools found that 24% of districts with a fast food or beverage contract gave exclusive advertising promotion rights to that company, including placement of the company's name and logo on school equipment and facilities. Only 13% of the districts did not allow advertising on campus.
There are many types of direct advertising in schools, such as soft drink, fast food, or snack food corporate logos on athletic scoreboards, sponsorship banners in gyms, ads in school newspapers and yearbooks, free textbook covers with ads, and screen-saver ads on school computers for branded foods and beverages. The US GAO report found that the most visible and prevalent types of direct advertising in schools were soft drink advertisements and corporate names and logos on scoreboards. Recently, food marketing to youth in schools has become even more intense, persuasive, and creative. Some schools are now selling food advertising space on their athletes' warm-up suits, as well as inside and outside of school buses. A large multinational food company tested an advertising campaign in 2001 that paid ten elementary school teachers in Minneapolis, MN, US to drive cars to school that advertised Reese's Puffs, a sweetened cereal. The cars were wrapped with a vinyl ad and teachers earned a $250 monthly stipend for their efforts as "freelance brand managers." The campaign was to last from early August through the first month of classes in September but was canceled after 3 weeks due to public protest. 
Food advertisements can also be delivered through in-school media. About 12,000 schools or about 38% of middle and high schools in the US are connected to Channel One, the 12-minute current events program that carries two minutes of commercials including advertisements for soft drinks and high fat snack foods. Schools receive free video equipment in exchange for mandatory showing of the program in classrooms. Brand and Greenberg evaluated the effects of Channel One in-school advertising on high school students' purchasing attitudes, intentions, and behaviors. About 70% of the 45 food commercials shown on Channel One during one month were for food products including fast foods, soft drinks, chips and candy. In schools where Channel One was viewed, students had more positive attitudes about the advertised products, and were more likely to report intentions to purchase these products compared to students who did not have Channel One in their classrooms. However, students who watched Channel One did not report more frequent purchases of the advertised products compared with students in schools that did not show Channel One.
In the last 10 years, US marketing companies have developed strategies that focus exclusively on schools. For example, a US marketing company, Cover Concepts, distributes textbook covers, lesson plans, posters, bookmarks, sampling programs, specialty paks, and lunch menu posters to participating companies. These products are branded with the company's name or corporate logo and then distributed free to students and schools. Cover Concepts' promotional materials state: "Cover Concepts places your brand directly into the hands of kids and teens in a clutter-free environment. We work in tandem with school administrators to distribute free, advertiser-sponsored materials to over 30 million students – grades K-12 – in 43,000 authorized schools nationwide, plus additional reach in daycare centers throughout the country." A list of advertisers for Cover Concepts includes McDonalds, Pepsi, Gatorade, Frito Lay, General Mills, Hershey, Keebler, Kellogg's, M&M's, Mars, Kraft/Nabisco, Wrigley and State Fair Corn Dogs.
Indirect advertising includes corporate-sponsored educational materials and corporate-sponsored incentives and contests. Many US elementary school programs promote a reading incentive program that rewards students with a free pizza for reading a required number of books. When students reach their reading goal they are given a certificate for a free pizza. McDonald's McSpellit Club rewards perfect scores on spelling tests with coupons for free hamburgers, cheeseburgers, or Chicken McNuggets. Local McDonald's restaurants provide schools with coupons redeemable for french fries and soft drinks. Food industry-sponsored classroom nutrition education materials are widely available.

Product placements
Product placement is increasing in popularity and becoming more acceptable as a standard marketing channel. It typically involves incorporating brands in movies in return for money or promotional support. Fees are variable depending on the relative prominence of the placement in movies, and are usually around $50,000 to $100,000. The product placement may be placed as a backdrop "prop" or may be an integral part of the script. Producers contend that product placement makes sets look more realistic and that brands help define characters and settings. In addition, product placement can help offset production costs. Product placement in the movies first gained attention in 1982 when it was reported that sales of the peanut butter candy Hershey's Reese's Pieces increased by 65% within a month due to its placement within E.T., The Extra Terrestrial. It is reported that placement is being used more in radio, music videos, books, comic strips, plays, and songs and that product placement agencies are increasing in number. 

Kids' clubs
Several corporations have developed branded kids clubs as a way to communicate with and maintain an ongoing relationship with children. The name is a misnomer in that many kids clubs aren't really clubs, but standard marketing programs with names that imply they are clubs. Kids clubs permit mass marketing on a personalized basis and club members may receive direct mailing such as membership cards, birthday cards, holiday greetings, and newsletters. In addition they can participate in contests, receive coupons and branded items such as posters, screensavers, and discounts for items with the club's logo. Some examples of kids clubs from corporations include Burger King, Nickelodeon, Fox, Sega, and Disney. The Burger King Kids Club has more than 5 million members. 

Internet
Online media play an increasingly significant role in the lives of US children and teenagers. US Census data indicate that between 1998 and 2001 the proportion of US adolescents (ages 14–17 years) using the Internet increased from 51% to 75% and the proportion of US children (ages 10–13 years) online increased from 39% to 65%. Families with children represent one of the fastest growing segments of the population using the Internet. US Census data from 2001 indicate that half (51%) of US children 10–13 years old and 61% of those 14–17 years old have Internet access at home.
Advertisers and marketers have begun to target the rapidly growing number of US children online with a variety of new interactive advertising and marketing techniques. The forms of advertising and marketing on the Web differ significantly from television commercials. Utilizing the unique features of the Internet, companies can seamlessly integrate advertising and Web site content. Almost all of the major companies that advertise and market to children have created their own websites, designed as "branded environments" for children. This electronic advertising "environment" and on-line infomercials is evident with food companies, which offer multiple entertaining, animated and interactive areas developed specifically for preschoolers and children around their food products. These sites include games, word-find puzzles, contests, quizzes, riddles, music, e-mail cards, clips of commercials, sweepstakes, downloadable recipes, desktop wallpaper and screensavers that feature their products, and on-line stores that sell licensed merchandise. Children can also sign up to receive electronic newsletters with news about products and promotions. The sites often feature popular product spokes-characters and animated cartoon characters, such as Tony the Tiger, Chester Cheetah, Toucan Sam, and Snap! Crackle! And Pop! The integration of products into games is commonplace. The company's website is frequently featured on ads or product packaging. Examples of food branded environments for children on food company websites are shown in the table below.

In addition to food company sites, there are also several other commercial sites that advertise food products to children. Internet sites aimed at preschoolers have proliferated in recent years. Popular sites include Disney.com, NickJr.com from cable television network and Nickelodeon, and FoxKids.com from the Fox Kids cable channel. All of these websites are supported by advertising. It is reported that more than two-thirds of all Internet sites designed for children and adolescents use advertising as their primary revenue stream. Content analyses studies to document television food advertising have not yet been conducted with the Internet sites oriented to children. Due to criticisms from consumer advocacy groups, many children's websites and food company web pages for children now put "ad bugs" or the word "advertisement" next to a sponsor's hotlink. However, these can be easily missed, especially by young children.

Toys and products with brand logos
There has been a recent trend among food companies to market toys and products with brand logos to preschoolers and young children to develop an early and positive relationship with the child and thereby promote brand awareness and preference. The food industry has partnered with toy manufacturers to create toys that advertise food. General Mills last year partnered with Target stores to create a line of children's loungewear based on iconic cereal brands like Trix and Lucky Charms. The M&M's candy company offers a catalog of items including toys and clothing. Examples of toys with brand logos are shown in the table below.




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