Obesity Fear Frenzy Grips Food Industry

Why Coke's Creative Chief Esther Lee Isn't Alone in Fearing FTC, Critics

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"Our Achilles heel is the discussion about obesity," Coca-Cola Co. Chief Creative Officer Esther Lee confessed to attendees at the Venice Festival of Media last week. "It's gone from a small, manageable U.S. issue to a huge global issue. It dilutes our marketing and works against it. It's a huge, huge issue."
Coca-Cola Co. Chief Creative Officer Esther Lee is one of many food industry leaders to express fear about a global push to combat obesity.
Coca-Cola Co. Chief Creative Officer Esther Lee is one of many food industry leaders to express fear about a global push to combat obesity. Credit: Rob Kennard

And it's getting even bigger as the Federal Trade Commission takes the extreme step of issuing compulsory requests for information from 44 food, beverage and quick-service restaurant chains this summer. The goal is to get a "more complete picture" of their kid-marketing practices, especially in the unplumbed arenas of in-store promotions, events, packaging, internet marketing and product placement in video games, movies and TV programs.

Industry observers note McDonald's is also likely to be running scared, whether or not there is a smoking gun. "It's clearly a witch hunt," said one industry executive, and if anyone is to be picked as the scapegoat it's likely to be the fast feeder which, he said, buys as much media for the 6-to-11-year-old set as other marketers spend on their entire annual budget.

More pressure on marketers
Going after companies individually cranks up the heat on marketers like McDonald's and Coke who have already been feeling plenty. Though the food industry has scrambled to rein in efforts targeted at young children and dedicate at least half of advertising to older kids toward more healthful offerings, politicians and pundits aren't pleased enough with the industry's collective effort.

It's "a wake-up call that time is running out," said Tim Stock, managing director at ScenarioDNA. Marketers are "all worried at some level. They know something has to change. And it's not about advertising. It's about going back to the product drawing board and creating a sustainable brand."

The problem, though, is whose definition of sustainable you're using -- that of consumers or that of the government -- as better-for-you brands are not necessarily what consumers are looking for. "In marketing, usually, you follow what consumers want and figure out how to give it to them, but in this instance, people aren't looking for these healthier products and the ones who are probably are not the ones whose children are overweight," said a top executive of a marketing agency

Broad, worrisome probe
Ron Urbach, partner at law firm Davis & Gilbert, said there is certainly cause for concern because the "food sector continues to get probed and prodded even after taking significant action." The new probe is particularly worrisome because it covers such a broad scope, looking at all media and marketing activities to kids under 18. "The more you probe, the more you find."

Association of National Advertisers Exec VP-Government Relations Dan Jaffe balked at the fact that despite "already enormous and well-developed" changes to marketing and new-product portfolios, "still people are saying more, more, more."

He doesn't believe the new FTC demand will drive marketers to make more significant changes to their marketing and new-product initiatives aimed at kids, as they have "already stepped forward and spent multiple billions of dollars to create healthier options, advertise them heavily" and have pledged to do even more as part of the Children's Food & Beverage Advertising Initiative.

Sharing the blame
The industry also lays blame on the government. Mr. Jaffe cited the cancellation of the Center for Disease Control's activity-driving VERB campaign aimed at kids and said the CDC's nutrition and physical-activity programs are in place in only 22 of the 50 states. "This is a multifaceted issue," he said. "Advertising alone cannot be implicated."

Even critic Sen. Sam Brownback, R-Kansas, acknowledges that changes to advertising won't solve the obesity problem. But he told a recent Kaiser Family Foundation panel "advertising is a target ... one I think that we can address and move forward with quickly." Contributing: Ira Teinowitz
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