A Washington-based advocacy group is urging new government regulations that would limit how food marketers can advertise to children in digital environments, with the hope of chipping away at childhood obesity rates in the United States.
The Center for Digital Democracy has written a 98-page report on the practices of food marketers on cell phones, digital video, social networks, games and virtual worlds.
The CDD plans to present the report to the Federal Trade Commission and the Federal Communications Commission on Thursday, the eve of an FTC deadline for public comment on food marketers' tactics to reach children across all media.
The report, called Interactive Food & Beverage Marketing: Targeting Children and Youth, was commissioned by the Berkeley Media Studies Group. It highlights new types of digital media marketing by food and beverage companies. Such tactics include food company-created viral videos on YouTube and fast-food characters posing as "friends" on the teen hangout MySpace.
New regulations are particularly important now, according to the report's authors, because of the sheer amount of time kids spend in digital environments and the evolving techniques that marketers use to reach them.
"It's essentially an unregulated new frontier for these marketers, and they're trying everything they can to get at kids and teens," said Kathryn C. Montgomery, a professor at American University who co-authored the report. "Some of the tactics may well be deceptive and a number of them may be unfair, flying under the radar of parents, and federal and health regulators."
The CDD said that after issuing the report, it will have attorneys examine the marketing practices of food and beverage companies. Then, it plans to file a complaint with the FTC on individual companies' tactics, Montgomery said.
The report comes at a time when parents, educators and health officials are struggling to grapple with a growing epidemic of childhood obesity in the United States. An estimated 2 million children ages 12 to 19 have experienced a pre-diabetic condition that's linked to obesity and inactivity, according to research from a nutrition standards board. Researchers have also shown that food and beverage advertising greatly influences kids' purchasing choices and eating habits.
As a result, government regulators are examining food marketing more closely, under a mandate by Congress. In the coming months, the FTC plans to subpoena 44 food, beverage and fast-food companies for details on their marketing practices to children, including their spending.
The FTC did not specify which companies it would subpoena, but said it is seeking data on marketing in traditional and nontraditional media, including product placements, video game advertising and some forms of Internet advertising, according to FTC spokeswoman Jackie Dizdul.
Once the data is collected, the FTC will write a report on its findings, called "The Food Industry Marketing to Children Report," for submission to Congress. The trade commission had held a public comment period for requests on its food and beverage marketing inquiry, which will close Friday.
The CDD is asking that the FTC consider its report and request that food and beverage companies provide details about how they are profiling children in digital environments, on the development of user-generated content online, and their marketing in virtual worlds, among other requests.
"The purpose of the report is an emergency wake-up call to clueless regulators," said Jeff Chester, executive director of the CDD, which filed a similar report focusing on how marketers target kids online in 1996. Its ensuing complaint eventually led to the Children's Online Privacy Protection Act, which essentially requires marketers to obtain permission from parents before collecting any personal information from their children ages 12 and under.
The current focus of the policy debate is centered on television. In January, the FCC began enforcing new federal rules that restrict children's TV channels like Nickelodeon from displaying Web site addresses that contain any links to commercial content. But critics argue that those regulations are short-sighted, given that marketers today are targeting children on media beyond the TV.
"The world has changed. Young people are living in distinct digital media environments, with far more impact on attitudes and development than TV," said Chester.
Particularly in the last few years, he said, marketing and digital media have merged to create a powerful force in the lives of younger generations, through devices like mobile phones and within virtual reality sites. "Call it the Second Life of the dot-com boom," Chester said.
Some examples of digital food marketing contained in the report:
In the fall of 2005, McDonald's launched its McFlurry mobile marketing campaign, which targeted younger people with coupons for free dessert via their cell phones. The fast food chain urged kids to text message a special phone number to receive an instant digital coupon, along with free ringtones. McDonald's promoted the campaign on billboards near high schools.
In the spring of 2005, the Kellogg Company printed promotional URLs on more than 6.5 million of its Corn Pops cereal packages. Kids visiting the page were required to give personal information, including a cell phone number, to play a trivia game for the potential to win various prizes.
Coca-Cola introduced an initiative called My Coke Rewards, which placed special codes on products that let buyers access a site and enter personal information to get rewards like downloadable ringtones.
Wendy's has created videos-cum-commercials on YouTube that are designed to attract younger generations. One video, "Molly Grows Up," depicts a young girl ordering her first 99-cent Jr. Bacon cheeseburger and Frosty. It generated 300,000 views, according to CDD.
Representatives of the companies could not be reached for comment Wednesday.
Nutrition experts and some members of Congress are already showing support for new regulations surrounding digital food marketing.
Sen. Tom Harkin (D-Iowa) is expected to hold a press conference Thursday morning following the issue of the report.
Marion Nestle, a professor in the Department of Nutrition and Public Health at New York University and author of several books on nutrition, highlighted the growth of food makers' spending toward kids in recent decades in order to boost quarterly profits. That spending has trickled to the Web as more kids have gone online.
According to Nielsen/NetRatings AdRelevance data, online spending among the top 15 food and beverage companies is the highest in the consumer category at nearly $11 million in April. Last year, marketing spending online by food, beverage and candy companies totaled $133.7 million, up 23 percent for the year, according to data from Advertising Age, which put the industry at 15th in U.S. Internet spending.
"We cannot rely on the food industry to self-regulate, especially when much of its marketing is invisible to the sight of most adults," Nestle said in a statement. "Congress and the FTC need to act on this new information about digital food marketing and start putting some restrictions on direct marketing of junk foods to children."