As Health Pressure Rises, Kids Cereals Spending More on Ads

Anti-Obesity Group Claims Media Spending up 34% From 2008

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A correction has been made in this story. See below for details.

Tony the Tiger, Trix Rabbit and Fred Flinstone are under fire again.

A leading anti-obesity research center puts those and other sugary-cereal icons in the cross hairs in a report that criticizes food companies for hiking marketing spending on kid-targeted brands, including aggressive ad investments in "some of their least-nutritious" cereals.

Sales for the top chidlren's brands in 52 weeks ending April 15.
Sales for the top chidlren's brands in 52 weeks ending April 15.

The Yale Rudd Center for Food Policy & Obesity cites "incremental" nutrition improvement in the cereals since it conducted its last study in 2009, such as reductions in sodium and sugar and increases in fiber. But "children still get one spoonful of sugar in every three spoonfuls of cereal," report co-author Jennifer Harris said in a statement. "These products are not nutritious options that children should consume every day."

Industry leaders countered that cereal makers have made steady and significant nutritional progress on brands advertised to children. While there is more work to be done, "changing kids' taste preferences takes time," said Elaine Kolish, director of the Children's Food and Beverage Advertising Initiative , or CFBAI, which oversees marketing regulations created by the industry.

Total advertising spending for child and family brands by company.
Total advertising spending for child and family brands by company. Credit: Source: Nielsen
Trends in advertising spending for child, family and adult brands.
Trends in advertising spending for child, family and adult brands. Credit: Source: Nielsen

Companies spent $264 million in measured media on kid-targeted cereals last year, up 34% from 2008, according to the report, which analyzes the nutritional content and advertising habits of 16 brands the center determined to be aimed directly at children. General Mills, which accounted for eight brands in the report such as Lucky Charms and Trix, spent the most at $142 million, a 27% increase from 2008, according to the report. Kellogg Co. hiked spending by 47%, shoveling $108 million into five kid-targeted brands, including Frosted Flakes and Froot Loops. Post Holdings increased spending by 17% to $13.8 million on its two child-targeted brands, Pebbles and Honeycomb.

The investments come as marketers fend off competition from more convenient and sometimes healthier breakfast options, such as yogurt, which have taken share from the $6 billion-plus cereal category, including the all-important kids segment. Last year, 39% of all in-home children's breakfasts included cereal, dropping from a peak of 49% in 1997, according to the NPD Group, a market research group. Marketers "are doing everything in their power to at least keep kids volume flat," said Rick Shea, a food-marketing consultant and former VP-marketing at breakfast-food maker Malt-O-Meal. "They are propping it up with lower prices and continued advertising."

The Yale Rudd report, which cites Nielsen data, includes spending on adult and children's programming. The average child (age 6-11) saw 559 TV ads for kid-targeted cereals in 2011, a slight drop from 567 in 2008, according to the report. At the same time, companies appear to be shifting more advertising of kids' brands to media aimed at adolescents and adults. For instance, the latest campaign for Frosted Flakes targets dads, while General Mills touts the whole grain in its Big G kid cereals.

"What we find troublesome is when they advertise to parents with the message that these products have fiber or have whole grains or talk about the good ingredients in the product and don't talk about the sugar or sodium at all," Ms. Harris said in an interview. But Ms. Kolish said parents should get more credit. "I am not going to treat adults like children," she said. "They can read nutrition facts panels, they can do research."

The report comes as food marketers face more scrutiny in the wake of America's rising obesity epidemic, including from the federal government, which has pursued tighter guidelines on what foods can be marketed to children. Although that effort has stalled, companies have responded with tougher self-regulations. Walt Disney Co., for instance, said it will put new restrictions on what foods can be advertised on some of its outlets, including Disney Channel.

Meanwhile, food marketers will tighten their guidelines by December 2013 as part of the CFBAI, which operates under the Better Business Bureau. For cereal, brands with more than 10 grams of sugar per serving won't be able to advertise to children. While a lot of brands already comply some don't, including Kellogg's Frosted Flakes (11 grams) and Fruit Loops (12). As of last year, 86% of children's cereals had 10 grams or less of sugar per serving, up from 52% in 2010, according to CFBAI. (Disney's new standard, to take effect in 2015, limits cereals to 9 grams.)

Yale Rudd Center favors the government-proposed standards, which would generally put the ceiling for kid-advertised cereals at about 8 grams of sugar, which would knock out a bunch of brands, including Lucky Charms (10 grams) -- unless they are reformulated. While cereal is not the largest contributor of sugar in the diet, "it does set the day and it also gets children used to high level of sweetness, so they want it in other foods as swell," Ms. Harris said. And it's "totally unnecessary," she added. "You can give children plain Cheerios and put fruit on it and they will like it."

The industry favors a more gradual approach, fearing that if you cut too much sugar at once kids will abandon cereal altogether, losing beneficial ingredients such as fiber and calcium. "Cereal with milk is a leading source of 10 nutrients," Kellogg said in a statement. "Study after study has proven that children who eat a cereal breakfast tend to weigh less."

Post Exec VP-Marketing James Hollbrook pointed to Alpha-Bits. When Post was controlled by Kraft Foods several years ago, the company removed all the sugar from the brand. But sales plummeted, Mr. Hollbrook said in an interview. Post, now an independent company, added some of the sugar back about a year ago. "We're seeing more interest in the brand and sales have stabilized," he said. "If you kill the taste then the brand doesn't work."

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CORRECTION: A previous version of this story incorrectly reported that Post's Fruity Pebbles had 11 grams of sugar per serving. Fruity Pebbles was reformulated more than a year ago to include 9 grams of sugar. The information in the story was based on nutritional information displayed on a Post web site that still showed the cereal containing 11 grams of sugar. The web site was not updated to show 9 grams until after the Ad Age story ran

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