Marketing Regulation Marketing to Children
Dec 25, 2015
Marketing Regulation
Marketing to Children
Children’s exposure to commercials
watch an average of 3 to 4 hours of TV per day
spend 1500 hours in front of the TV annually
900 hours in the classroom
average child sees > 20,000 commercials each year
American children will have viewed ~360,000 commercials on television before graduating high school
Food and toys are the two most commonly advertised products.
Concerns related to children watching
commercials
Most children younger than 6 do not understand that
the purpose of advertising is to sell a product
Children up to age 8 cannot distinguish advertising
from regular television programming
Children who watch 4 or more hours of TV a day are
more likely to believe advertising claims than
children who watch TV less often
9 out of 10 food ads on Saturday morning TV are for
sugary cereals, candy, salty snacks, fatty fast foods
and other junk food.
Regulation of commercials aimed at
children: FTC regulation
1970's, FTC proposed a regulation banning
advertising of candy and sugared cereals on
shows targeted to children under 13
Calling FTC a "national nanny," Congress in
1980 prohibited the FTC from issuing rule
FTC has brought individual actions based on one of two theories:
1. Ads might deceive children, even though they would not have the same effect on adults
toy ballerina standing alone and twirling
toy vehicle appearing in the ad to operate under its own power
2. Ads showing children engaged in activities that are potentially hazardous, even though adults might reasonably avoid injury
cooking hot foods
using a blow dryer next to a sink filled with water
1990 Children's Television Act (CTA)
Enforced by the FCC
Requires broadcast stations to serve the educational and informational needs of children 16 and under
Requires stations to carry at least three hours a week of such programming
FCC Rules adopted under CTA limit commercial time during children's programming to 10.5 minutes per hour on weekends
12 minutes per hour on weekdays
"Program Length Commercials"
FCC Rule
Entire program is counted as commercial if
program associated with a product; and
commercials for product air during show
Compliance with FCC Rule considered in
determining whether to renew license
Children's Advertising Review Unit
(CARU)CARU Guidelines
Five General Guidelines:
Communicate in truthful manner using understandable
language
Address advertising to positive social behaviors
Present positive pro-social role models
Contribute positively to the parent-child relationship
Avoid marketing inappropriate products directly to children
Marketing junk food to children
Obesity the major health issue of the day
“tobacco of the 21st century”
2000--diet and physical inactivity accounted
for 400,000 deaths
16.6% of total
200--tobacco caused 435,000 deaths
18.1% of total
Smoking rates are dropping
Americans are increasingly overweight
Obesity likely to overtake tobacco as the leading
cause of preventable deaths as early as 2005
March 10, 2004 House passed bill protecting food
industry from lawsuits based on weight issues
Key sponsor of bill is from district home to Darden
Restaurants
Owner of Olive Garden and Red Lobster
Food companies spent $15 billion on
advertising to children in 2002
Up from $12.5 billion in 1998
Advertising used to be limited to Saturday
mornings
Now it’s everywhere
television
movies
school
Promotional tie-ins and licensing have
become significant marketing tools
Rugrats Fruit Snacks
Flintstones Jell-O
Scooby-Doo cheddar crackers/macaroni & cheese
2003--45% of fruit snacks had licensing
agreements
1996--10%
Advertisers use characters from shows to
market products on television
SpongeBob SquarePants used to sell Kraft
Macaroni and Cheese, Popsicles and fruit snacks
SpongeBob SquarePants show--more than
half the commercials are about food
“The programs have become advertising for
the food, and the food has become
advertising for the programs”
Some companies deny marketing to children
Coke says it targets teens and adults
2001--Coke signed tie-in with Harry Potter
character
Increase in food marketing parallels increase
in children’s weight
Since 1980, number of obese children
doubled to 16%
Where does the responsibility lie?
Food companies?
Parents?
Marketing Regulation
Marketing to Adults
20-19
Regulation and Marketing to Adults
Marketing Communications
Product Issues
Pricing Issues
20-20
Marketing Communications
Advertising and Values
Consumer Information Accuracy
Adequacy of Consumer Information
Advertising and Values
•There is a concern regarding the long-term effect of a
constant flow of messages, emphasizing materialistic or
narcissistic values on both individuals and society.
•For example, the portrayals of
beauty
casual attitudes toward sex
women in stereotypical roles or as decoration
Consumer Information Accuracy
•Various businesses, consumer groups, and
regulatory agencies are deeply concerned with
the interpretation of marketing messages.
•Regulating the explicit verbal content of ads is
difficult, and regulating the more subtle
meanings implied by the visual content of ads is
much more difficult.
Adequacy of Consumer Information
•A number of laws have been passed to ensure information
adequacy, e.g., the Nutritional Labeling and Education Act
(NLEA) of 1990.
•Marketers, consumer groups, and public officials would like
consumers to have all the information they need to make
sound choices.
One approach is to provide all relevant information to the
consumer.
However, a risk is information overload.
Product Issues
Two major concerns of consumer groups:
Are the products safe?
Are the products environmentally sound?
Pricing Issues
Consumer groups want prices that are fair and accurately
stated.
The FTC is the primary federal agency involved in
regulating pricing activities.
An external reference price is a price provided by
the manufacturer or retailer in addition to the actual
current price of the product.