Marketing Food to Children and Adolescents - Federal Trade ...
Marketing Food to Children and Adolescents - Federal Trade ...
Marketing Food to Children and Adolescents - Federal Trade ...
Create successful ePaper yourself
Turn your PDF publications into a flip-book with our unique Google optimized e-Paper software.
87<br />
Endnotes<br />
46. See Julian E. Barnes, Fast-<strong>Food</strong> Giveaway Toys Face Rising Recalls, N.Y. Times, Aug. 16, 2001, at A1<br />
(“Estimates vary as <strong>to</strong> how much the fast-food companies spend <strong>to</strong> manufacture the <strong>to</strong>ys … but food <strong>and</strong><br />
<strong>to</strong>y executives estimate the <strong>to</strong>ys cost 30 <strong>to</strong> 50 cents each.”); McDonald’s Rests. of Mass., Inc. v. Comm’r of<br />
Revenue, No. C262528, 2005 WL941510, at *2 (Mass. App. Tax. Bd. 2005) (each Happy Meal <strong>to</strong>y distributed<br />
by Massachusetts franchisees in December 1997 <strong>and</strong> November 1999 had a cost of 43 cents); In re E-M<br />
<strong>Food</strong> Corp T/A McDonald’s Rest., Nos. 809808, 809809, 809810, <strong>and</strong> 809811, 1993 WL 98470, at 10 (NY<br />
Div. Tax. App. 1993) (noting that cost of Happy Meal <strong>to</strong>ys <strong>to</strong> Long Isl<strong>and</strong> franchisees ranged between 40 <strong>and</strong><br />
49 cents per unit).<br />
47. The amount reported by carbonated beverages for movie theater, video, <strong>and</strong> video game advertising, however,<br />
is likely under-reported. Movie theater chains often have discretion in selecting the films before which<br />
they place food advertising. As a result, some companies reported that they did not have data on the ratings<br />
of movies preceded by ads for their products; thus, they could not accurately allocate expenditures for ads in<br />
movie theaters that might have met the Special Order criteria for child- or teen-directed advertising.<br />
48. This category included sponsorship of amateur <strong>and</strong> professional athletes, teams, <strong>and</strong> leagues, including youth<br />
teams or leagues.<br />
49. The two categories of athletic sponsorships <strong>and</strong> celebrity endorsements were combined for purposes of analysis<br />
because a few companies reported fees paid <strong>to</strong> an athlete endorser as an athletic sponsorship rather than as<br />
a celebrity fee.<br />
50. Events included sporting events, concerts, activities at theme parks <strong>and</strong> shopping malls, <strong>and</strong> company promotional<br />
<strong>to</strong>urs. Some companies purchased billboard <strong>and</strong> scoreboard advertising <strong>and</strong> naming rights in arenas<br />
<strong>and</strong> other large venues that hosted both adult <strong>and</strong> youth-directed events; in those cases, companies calculated<br />
the percentage of the advertising costs that could be attributed <strong>to</strong> the child <strong>and</strong> teen events.<br />
51. Some beverage bottlers objected <strong>to</strong> the criteria for in-school marketing, which included advertising on or<br />
around vending machines, as well as payments – whether in the form of vending commissions, sponsorship<br />
fees, or equipment donations – made pursuant <strong>to</strong> food <strong>and</strong> beverage contracts with schools or school systems.<br />
Companies asserted that vending machines are not a device for advertising, but simply a means of delivering<br />
<strong>and</strong> dispensing products. In addition, they stated that payments <strong>to</strong> schools often are used for the schools’<br />
own internal purposes, for which the company may receive no true advertising value. Given the broad focus<br />
of advertising <strong>and</strong> marketing activities addressed in this study, however, as well as the fact that vending in<br />
schools is clearly directed <strong>to</strong> children <strong>and</strong> adolescents, the Commission determined that, for purposes of<br />
this report, it was appropriate <strong>to</strong> include advertising on or around school vending machines as a marketing<br />
activity.<br />
52. In general, QSR expenditure data covered national advertising expenditures by company-owned <strong>and</strong> franchisee-owned<br />
establishments, <strong>and</strong> local expenditures by company-owned establishments. In addition, two of<br />
the reporting companies estimated local advertising expenditures by company-owned <strong>and</strong> franchisee-owned<br />
restaurants.<br />
53. See supra Section II.C.4.B.<br />
54. Some companies claimed difficulty in compiling expenditure data for the implementation of the celebrity<br />
endorsement (e.g., data on television advertising, packaging, <strong>and</strong> sweepstakes featuring the endorser). Thus,<br />
it is likely that the costs associated with celebrity endorsements were under-reported. For example, carbonated<br />
<strong>and</strong> non-carbonated beverage companies reported $3.7 million in endorsement fees, but did not report<br />
the costs associated with implementation of the endorsements. As a result, the $3.7 million in endorsement<br />
fees under-reports use of celebrity endorsements in these food categories.<br />
55. Many companies reported that their advertising directed <strong>to</strong> children under 12 adheres <strong>to</strong> self-regula<strong>to</strong>ry<br />
guidelines administered by the <strong>Children</strong>’s Advertising Review Unit (CARU), a division of the Council of<br />
Better Business Bureaus. These st<strong>and</strong>ards aim <strong>to</strong> ensure that children’s advertising is not deceptive, unfair,<br />
or inappropriate for its intended audience, <strong>and</strong> take in<strong>to</strong> account children’s particular vulnerabilities, such as<br />
their inexperience, immaturity, susceptibility <strong>to</strong> being misled or unduly influenced, <strong>and</strong> their lack of cognitive<br />
skills needed <strong>to</strong> evaluate the credibility of advertising. <strong>Children</strong>’s Advertising Review Unit, Self-Regula<strong>to</strong>ry