Childhood Obesity & Responsible Marketing

Childhood Obesity & Responsible Marketing Strategic CSR ~ MBA292C-1 ~ Kellie McElhaney Sarah Anderson ~ Cristin Gendron ~ Annabelle Louie ~ Amy Omand

Agenda • Childhood Obesity Trends • Advertising & Marketing to Children • “Irresponsible” vs. “Responsible” Marketing • Moving Forward • Industry Pioneers • Risk/”Benefit” Analysis

A Growing Concern…(pun intended) Physical, Emotional, and social consequences.

Source of Children Finding Out About Food or Drink Products ADVERTISING INFORMATION IN STORE /SEEN IN STORE THE SCHOOL HIS/HER FRIENDS FIRST MENTION TOTAL MENTIONS Source: The Co-Operative Group, 2002

Who Is Responsible? Companies supplying food products for children are increasingly held accountable for their effects on childhood obesity

What Constitutes “Irresponsible” Marketing? • Advertising on television shows for which more than a quarter of the audience is children • Product or brand placements in media aimed at kids, including movies, television shows, video games, web sites, and books • Licensing agreements or cross-promotions with kid-oriented movies or television programs, or use of cartoon or fictional characters from such programs • Use of curricula, fundraising activities, educational incentives, or other school-based sales or marketing of junk food Source: CSPI, 2006

What is “Responsible” Marketing in this Context? • Advertisers should know their audience • Ad’s must be truthful (follow FTC guidelines) • Substantiate claims, because children are not discerning • Do not stimulate children’s unreasonable expectations about product quality or performance. • Products and content inappropriate for children should not be advertised directly to them. • Avoid social stereotyping; present positive role models • Include educational aspects and encourage positive personal qualities (honesty, respect, safety, etc.) • Contribute to the parent-child relationship in a constructive manner. Source: The Children’s Advertising Review Unit (CARU) Self-Regulatory Program for Children’s Advertising

What Drives Responsible Marketing? Defensive Approach Offensive Approach • to expand consumer base in anticipation of shifting demand • to hedge against anticipated policy changes • to reap higher margins from ‘premium’ or ‘healthy’ brands • to lead in the production and marketing of healthier products for children • to avoid lawsuits • to conform to policies and regulations • to meet retailer requirements

Should Stakeholders Focus on a Defensive or Offensive Strategy? Source: Kellie McElhaney’s lecture slides

Responsible Marketing-CSR Spheres of Influence Source: Kellie McElhaney’s lecture slides

Our Recommendations: What Can Be Done? • Use their creativity, resources and full range of marketing practices to promote healthy diets for children • Work with government, scientific, public health, and consumer groups to establish and enforce high standards for the marketing of food and beverages to children Companies • State and local educational authorities should educate about and promote healthy diets for children in all aspects of the school environment • (e.g., commercial sponsorships, meals & snacks, curriculum) Community

Our Recommendations: What Can Be Done (cont.)? • Food/Beverage industry trade associations can assume leadership roles in harnessing industry creativity, resources, and marketing on behalf of healthy diets for children • The media and entertainment industry should direct its extensive power to promote healthful food and beverages for children Industry Policy (‘World’) • Government should marshal the full range of public policy levers to foster the development and promotion of healthy diets in children

Industry Pioneers Some companies have recognized the effects their business practices have on children and are taking important steps toward acting in children's best interest • In January, Kraft Foods decided to stop advertising its low- nutrition foods during children's programs and replace them with ads for more nutritional snack products • Sesame Street recently teamed with Earth's Best to launch a new line of organic and "nutrient-rich" breakfast foods and snacks for children • Nickelodeon refused to allow one of its characters, Dora the Explorer, to be used for a Burger King kids' meal unless a piece of fruit was included in the meal

Risk/”Benefit” Analysis Risks: Taking Action Risks: NOT Taking Action • If you do not communicate your issue, someone will communicate for you • Diminished reputation – a company’s most important asset • Loss of trust and credibility within the marketplace • Exposure to lawsuits • Potential decline in sales as parents become more conscious of their children’s health • Loss of partnerships with other companies, such as licensing agreements • Product boycotts • Future policy changes may force action want to be ahead of the curve • Cannibalization of current products • Giving competitors an edge • Going outside of core competencies to pursue healthier options • Difficulty in establishing credibility • Costs involved in expanding product offerings and changing current marketing strategy

Thank You! Questions?

Childhood Obesity & Responsible Marketing