Kellogg Move Bodes Ill for Ads to Kids

More Than a Billion Food Marketing Bucks in Limbo as Companies Try to Satisfy the Critics

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WASHINGTON ( -- Saturday morning will never be the same again.

Legions of kids who start their weekends with the boob tube and a bowl of sugary cereal won't be seeing Snap, Crackle and Pop. Instead, they'll soon be seeing ads for more-healthful foods -- or none at all. By agreeing to market to kids only the 50% of its brands that meet certain nutritional criteria, Kellogg has kick-started an industry trend expected to throw into play some $1 billion or more in marketing dollars.
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Photo Illustration: John Kuczala

Turning up the heat
It's a move that ratchets up pressure on the other 10 marketers in the so-called Children's Food and Beverage Advertising Initiative, which account for more than two-thirds of the food and beverage ads kids see. They are feverishly working to meet or beat a July 18 deadline to announce responsible-marketing pledges of their own at a government kids'-obesity forum.

Titans in the initiative, such as Hershey, McDonald's and General Mills, have already committed to devote at least half their TV, radio, print and internet marketing to kids under 12 to furthering "the goal of promoting healthy dietary choices and healthy lifestyles."

Each marketer will set its own individual standards, so it's impossible to say just how much spending will be affected. But judging by the breadth of the Kellogg plan -- which alone involves more than $200 million -- it's going to be a significant sum, particularly if you're a kid-focused media owner.

Healthy ad diet
Kellogg said it would advertise only foods that fit a particular nutritional profile in any medium that gets more than 50% of its audience from kids under 12. Products that fit the criteria will have no more than 200 calories per serving, no trans fat and no more than 2 grams of saturated fat. There are also limits on sugar. Some 30% of Kellogg's cereals don't meet the standard; oddly, Rice Krispies doesn't (too much sodium) while Frosted Flakes does.

According to President-CEO David Mackay, 27% of the company's ad spending in the U.S. is directed toward children under 12. According to Advertising Age estimates, Kellogg spent $765.1 million on total marketing in 2006, so a potential $206 million could be affected. Kellogg said it would no longer spend on kid-directed TV, print, radio and internet for the affected brands and would ditch "website activities directed to children, promotions/premiums, product placement and in-school marketing" for brands that don't meet its criteria.
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"Wherever possible, implementation of Kellogg commitments will begin immediately," Kellogg said in a statement. "For example, certain brands will feature better-for-you options in their advertisements. We will be making content enhancements to our child-directed websites, including adding automatic screen-time limits and healthy-lifestyle and nutrition messaging, plus limiting depictions of foods that don't meet our nutrient criteria in interactive activities like games, downloads and wallpaper."

Half Kellogg's products
But even Kellogg isn't sure whether it will be redistributing those ad dollars or not. Mark Baynes, chief marketing officer for North America, said about half of the company's products marketed to kids under 12 don't meet the new nutrition threshold, and it's still not clear which ones can be reformulated to meet the guidelines and still appeal to kids. "The challenge now is: Can we reformulate without too much a trade-off in taste?" he said. "If we can, we will, and [continue] advertising to children in much the same way we do now. If we can't reformulate our product and there is too much of a trade-off, we have to find a new target audience to make the brand relevant or, if we can't, stop advertising it all together."

Though kids' TV programmers are staying cool publicly, the winds of change are buffeting networks such as Viacom's Nickelodeon and Time Warner's Cartoon Network. Kellogg alone spent some $44 million on Nickelodeon advertising last year, according to TNS Media Intelligence (excluding Nick at Nite) and $22 million on Cartoon Network.

The groups that pressured Kellogg into its agreement, the Center for Science in the Public Interest and the Campaign for a Commercial-Free Childhood, also had threatened to sue Nickelodeon, but they've put that on hold. With the Kellogg settlement and an expected flood of similar efforts from other marketers, the groups appear to feel Nick will be punished enough.

Nick will be like "a used Edsel no one is buying," said Steve Gardner, chief litigation officer at CSPI, before hastening to add that kids' food marketers could still advertise on the network -- just with more-healthful products.

Nick 'thrilled'
Cyma Zarghami, president of the Nickelodeon/MTV Networks Kids and Family Group, said, "As a company that's been at the forefront of encouraging our partners to provide more balance in their offerings, we are thrilled that companies like Kellogg are taking initiative to provide us with opportunities to introduce healthier food options to kids." Cartoon Network had no comment.

One thing is crystal clear: Big Food is expected to almost universally step up to meet the challenge of Kellogg. Sen. Tom Harkin has called this the "defining moment in our nation's fight against childhood obesity."

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Contributing: Kevin Brown (AdAge DataCenter), Andrew Hampp
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