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3 Emerging Issues in Food Marketing T he food and beverage industries are continually devising new ways of marketing their products. During the first workshop panel, three speakers examined several of the most prominent new vehicles and venues for food marketing. Minette Drumwright, associate professor in the Department of Advertising and Public Relations at The University of Texas at Austin, examined integrated marketing communications—the use of a wide range of traditional and new digital media to deliver multiple market- ing messages that reinforce and augment each other. Kathryn Montgomery, professor in the School of Communication at American University, looked at marketing directed at adolescents, who are not covered by industry self-regulation initiatives but are exposed to food and beverage market- ing in individualized and widespread ways. And Jerome D. Williams, Prudential chair in business and interim director and research director of the Center for Urban Entrepreneurship & Economic Development in the Department of Management and Global Business at Rutgers Business School–Newark and New Brunswick, discussed marketing targeting low- income and minority communities, which have been particularly hard hit by the obesity epidemic. Together these three speakers painted a picture of a media environment in which marketing is pervasive and powerful, yet often unnoticed. 13

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14 CHANGE IN FOOD MARKETING TO CHILDREN AND YOUTH INTEGRATED MARKETING COMMUNICATIONS Summary of presentation by Minette (Meme) Drumwright Drumwright noted that, over the past half-century, marketing has undergone several paradigm shifts: • In the 1950s and 1960s, the emphasis was on selling products. • As markets became more competitive in the 1970s and 1980s, the emphasis shifted to consumers and understanding and meeting their needs. • Since the 1990s, marketing has sought to build relationships with customers and stimulate engagement between consumers and brands. The focus on consumers and on relationship marketing has paved the way for the emergence of integrated marketing communications. D ­ rumwright opined that the floodgates for targeting children with inte- grated marketing communications were opened in 1981 when Congress eliminated the Federal Trade Commission’s (FTC’s) ability to regulate adver- tising based on fairness. According to Drumwright, integrated market­ng i communications is a comprehensive approach to marketing that combines various communication disciplines to bring about added value or synergy and maximize communication impact. This approach uses any relevant contact or touch point1 to reach the customer and seeks to speak with a single voice to build relationships and affect behavior. Integrated marketing communications is based on segmentation, target- ing, and positioning: • Segmentation is the process of subdividing a market into distinct subsets of customers who behave in a similar way or have similar needs. • Targeting is the use of a distinct marketing strategy for each subset of potential customers chosen as a market target. • Positioning is the way a consumer thinks of a product relative to its competition—how a product is differentiated in the mind of the consumer. 1  Touch points, which may be on- or offline, are encounters in which marketing activities “touch” customers.

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EMERGING ISSUES IN FOOD MARKETING 15 Flamin’ Hot Cheetos as an Example Drumwright illustrated these concepts using the example of Flamin’ Hot Cheetos, which are made by Frito-Lay, a subsidiary of PepsiCo. P ­ epsiCo has signed the Children’s Food and Beverage Advertising Initiative (CFBAI) pledge not to target anyone under 12 with its marketing. However, the integrated marketing campaign for this product demonstrates both the power of integrated marketing communications and its potential to influ- ence children. The campaign combines traditional mass media advertising, such as television commercials and outdoor advertising, with a host of persuasive approaches using digital media: • The Flamin’ Hot Cheetos packaging, part of the integrated market- ing campaign, features a cartoon spokescharacter, Chester Cheetah, who plays a key role throughout the campaign. He is portrayed as mischievous, playful, silly, and high-energy. In a television ad for the product, Chester gives a fireman a Flamin’ Hot Cheeto, after which the fireman’s head emits flames and smoke until it is doused by water. • The home page of the Cheetos website, headlined Chester’s Feed, features dozens of videos, games, and other dynamic content. Such digital marketing is popular with companies because it is cheap, it targets youth, it is action oriented, and it enables two-way com- munication, all of which build engagement. • The website features video games, such as the Legend of ­ heetocorn, C in which an avatar must eat Cheetos to score health points in order to advance through the game. In advergaming, the product typically is integral to the game play, the length of exposure to the game is usually 10 to 15 minutes or longer, and players often are asked to pass the game along to their online friends. • In a recent promotion called the Cheetos “Just Dance” Twitter Giveaway, consumers submitted videos to win prizes. One video, submitted by a Minneapolis YMCA after‑school program and featuring both Flamin’ Hot Cheetos and Takis, a chili pepper snack manufactured in Mexico, had more than 3 million views in 2 months. • A Google search for “Flamin’ Hot Cheetos challenge” brings up many other user-created videos that have been watched tens of thousands of times. The videos illustrate a key theme of integrated marketing communications—that of prompting consumers to cre- ate persuasive advertising messages themselves. Such viral market- ing seeks to create “buzz” when people talk about a product with one another either in real or in virtual conversations.

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16 CHANGE IN FOOD MARKETING TO CHILDREN AND YOUTH • In a Cheetos tie-in with a popular video game called Just Dance 4, putting the number from the front of a Cheetos package into a link given on the back of the package allows consumers to access a free song. A related Facebook page features a cross-product promotion of Chester’s Puffcorn, whereby the purchase of both products pro- vides access to two music tracks for video games. • Although some schools have banned Flamin’ Hot Cheetos, others feature the product as part of meals and offer it in school vending machines; some parents have defended their children’s preference for Cheetos on blog postings. Integrated Marketing Communications for Healthy Foods Integrated marketing communications has been demonstrated to work for healthy foods. For example, a promotion by Bolthouse Farms, a maker of baby carrots, featured packaging, video games, shelf signs, vending machines in schools, and television commercials, including commercial parodies that were part of an “Eat ’Em Like Junk Food” campaign. In pilot test markets, there was an approximately 11 percent median rise in baby carrot sales where the junk food packaging was available (McGray, 2011). The pilot test of the promotion was so successful that the program was rolled out nationally. Research Findings and Questions Research on advergames, or “gamification,” has shown that they influ- ence brand awareness, brand attitudes, and brand choice (Hernandez and Chapa, 2010; Mallinckrodt and Mizerski, 2007). Research also has shown that children have difficulty distinguishing or disentangling entertainment from persuasion on websites, in advergames, and in viral marketing, and that adolescents tend to equate the quality of information with its quantity (Agosto, 2002; Eastin et al., 2006; Staiano and Calvert, 2012). Most troubling, the emotions evoked by activities such as advergames tend to have a positive impact on perceptions and beliefs about nutritional value. Even though children and adolescents know they are being targeted by marketing, the enjoyment they experience neutralizes that realization and makes them think the product has positive nutritional value (Staiano and Calvert, 2012). Drumwright explained that it is difficult for traditional research m ­ ethods to capture all the impacts of integrated marketing communica- tions. Research on advertising is typically based on social psychology and focuses on short-term, micro-level responses to a single advertising stimu- lus (e.g., an individual’s reaction to seeing a television advertisement). But

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EMERGING ISSUES IN FOOD MARKETING 17 integrated marketing communications encompasses the long-term, aggre- gate effects of many different types of repeated advertising stimuli, and traditional advertising research is ill equipped to capture the magnitude of these effects. Policy Issues The advent of integrated marketing communications has given rise to several important public policy issues. Most prominently, should children and teens be protected from such marketing both online and in school? For example, the total advertising exposures created by integrated marketing communications could be limited, as could stealth marketing techniques that capitalize on emotions and tacit persuasion or on direct inducements to purchase through promotions. As another example, “ad breaks” that force children to take breaks from advergames and other forms of online promotions could be instituted. “Games are evidence of what some people call stealth market- ing, where consumers are immersed in branded environments frequently not knowing that they are being exposed to these very sophisticated marketing techniques.” —Meme Drumwright MARKETING TO ADOLESCENTS Summary of presentation by Kathryn Montgomery Adolescents have been largely overlooked in the academic literature on food marketing, in policy discussions, and in self-regulatory initiatives, noted Montgomery. Yet one of every three teens is overweight or obese, and the teen years are a critical development period when lifelong eating behaviors are established. Moreover, teens are particularly vulnerable to advertising, and no policies or self-regulatory safeguards are in place for this age group. Montgomery discussed three contemporary trends in marketing to adolescents, as well as their research and policy implications: 1. the growth of social media, 2. advances in data collection and measurement, and 3. the emergence of mobile technologies.

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18 CHANGE IN FOOD MARKETING TO CHILDREN AND YOUTH The Growth of Social Media The use of social media has become a core strategy for reaching and engaging teenagers. Facebook now has more than a billion monthly active users worldwide (Facebook, 2012), and as of June 2012, more than 85 per- cent of online teens in the United States used social media (Common Sense Media, 2012). For a teenager, having a Facebook profile is a required entry card into a social life that is increasingly played out in the virtual realm. Research has shown that social media are a key arena for teens’ per- sonal and social development. The use of social media taps into their developmental needs for identity, autonomy, and relationships with peers. Social media provide a networked public culture in which teens can express themselves and build self-identity. As a vehicle for marketing, social media are woven into daily inter- actions and social relationships. They orchestrate influence, foster fans, create “brand advocates,” and encourage young people to influence each other. Facebook has created the notion of social advertisements, which turn user behaviors such as “fanning” a product into opportunities that can be orchestrated to go viral. Some of the largest food and beverage companies are clearly targeting adolescents through social media. To celebrate the 100th-year anniversary of Oreo cookies, for example, Kraft created a social media campaign that encouraged people—with a focus on teenagers—to send photos, videos, and stories featuring Oreo cookies so they could be “shared with the world.” A hundred-day campaign offered whimsical and eye-catching ads each day to the approximately 30 million people who “like” Oreo on F ­ acebook. Between June and August, likes, comments, and shares increased by 110 percent for the brand.2 Montgomery also showed a video ad for Doritos that features websites, Facebook pages, tweets, markers on bags of Doritos that provide access to special web features, webcams, and other forms of social media, all in the context of a mock horror movie. The advertising campaign includes gami- fication, peer-to-peer interaction, and automated capture of personal data. Advances in Data Collection and Measurement Data collection, measurement, and targeting are woven together in the content and functionality of digital media. In an era of big data, actions can be measured in real time. The consumer’s “path to purchase” can be moni- tored, and levels of precision are unprecedented. Facebook, for example, 2  More examples of campaigns by major food and beverage brands are available at www. digitalads.org.

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EMERGING ISSUES IN FOOD MARKETING 19 is working with many companies that do analytic work to identify, track, monetize, and trigger behaviors both on- and offline. Using such an approach, marketing is increasingly targeted not at demographic groups but at individuals. Micro-targeting and personalized messages can be based on detailed profiles, online and offline behaviors, and psychographic3 characteristics. People can be retargeted in microseconds depending on where they may be or what they are doing. Montgomery argued that this growing infrastructure needs to be understood to gauge the effects of marketing on behavior. The Emergence of Mobile Devices Use of mobile devices is soaring among children as well as teens. Children and teens are using their mobile phones to interact with social media and with each other. Montgomery noted that African American and Hispanic teens show particularly high use of and engagement with mobile phones relative to other teens. (See the discussion of marketing target- ing low-income and minority communities later in this chapter.) The fact that these devices are available at any time of day or night allows mobile marketing to access users through such techniques as geolocation4 and geofencing.5 Through mobile devices, marketers are able to link the point where teens are influenced with the point of purchase. And the increasing use of “mobile wallets” allows a mobile device to be used for purchasing products in stores and restaurants. Today, marketing is fully integrated into teens’ personal and social lives. Each marketing experience can be individualized, and the loop between marketing, persuasion, and purchase is being closed. Research and Policy Implications Many questions need to be answered to understand marketing targeted at teens. Adolescent behavior, social relationships, individualized marketing and targeting processes, and brand identification all influence adolescent behavior. Montgomery believes research on brain development needs to look at the development of emotional regulation and decision making, risk taking, and impulsivity. Food-related behaviors need to be under- stood as forms of risk taking, along with sexual, driving, and alcohol and 3  Psychographic characteristics include variables or trends of personality, values, attitudes, fears, interests, and lifestyles. 4  Geolocation is the identification of the real-world geographic location of an object (such as a restaurant). 5  geofence uses the Global Positioning System to define geographic boundaries. A

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20 CHANGE IN FOOD MARKETING TO CHILDREN AND YOUTH drug consumption behaviors, and incorporated into that research agenda. Qualitative research methods could be used, including ethnography and “netnography.”6 The metrics and concepts used by the online industry to measure the impact of advertising campaigns need to be adapted for use in the analysis of health consequences, suggested Montgomery. Industry uses a variety of metrics, both quantitative and qualitative, and measures are built in to monitor and analyze behaviors so information can be generated automati- cally. For example, companies can target advertising in video games to an individual’s food preferences, and as marketing moves to mobile phones, purchases, locations, and preferences will increasingly be linked. These developments also create opportunities for research aimed at understanding behaviors involving food. The policy implications are as complex as the research questions, Montgomery added. There is a growing debate in many countries about online privacy and digital marketing. Teens are on the agenda, as when the FTC’s privacy framework identified them as “sensitive users.” Com- plaints about problematic practices have influenced industry self-regulatory regimes. Changes in the FTC’s rules on children’s privacy will limit the digital tracking of those under age 13. Montgomery emphasized the need to establish comparable safeguards for adolescents, and to develop a broad framework of fair marketing principles to ensure that teens growing up in this digital commercial culture will be able to make effective and conscious choices and understand their rights as consumers. “Teens are digital natives. They are online all the time. They are using their technologies on a daily 24/7 basis.” —Kathryn Montgomery MARKETING TARGETING LOW-INCOME AND MINORITY COMMUNITIES Summary of presentation by Jerome D. Williams From a public health perspective, marketing targeting low-income and minority communities can be pernicious because of its negative effects on health, Williams suggested. Furthermore, research on the effects of targeted 6  Netnography is the branch of ethnography that analyzes the free behavior of individuals on the Internet, using online market research techniques to provide useful insights.

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EMERGING ISSUES IN FOOD MARKETING 21 marketing is particularly complicated because of the multiplicity of avenues taken by modern marketing to reach its targets. Marketers target low-income and minority communities because of the amount of money to be made. The African American community in the United States has an estimated buying power for goods and services of approximately $1 trillion, as does the Hispanic community (Selig Center for Economic Growth, 2012). Moreover, targeting of these communities is long-standing. Reviewing an annual online survey of brand “likability” conducted by the firm Smartypants,7 Williams and colleagues documented children’s brand affinity scores for particular products and found that in 2009 and 2010, the top food and beverage brands among U.S. families with children aged 6 to 12 included Oreo, McDonald’s, M&Ms, Doritos, Kraft Macaroni and Cheese, and Reese’s. Their research revealed that advertis- ing of several of these products targeted African Americans and Hispanics (HER, 2011; Williams et al., 2012). Factors Affecting Food Preferences Many factors affect food preferences. For example, preferences for regular as opposed to diet sodas vary by brand. Neighborhoods also have an effect. One study, for example, found that living in an upper-income neighborhood, regardless of predominant ethnicity, generally is protective against exposure to most types of outdoor advertising for unhealthy prod- ucts, such as alcoholic beverages, tobacco products, sugary beverages, and fast food (Hillier et al., 2009). African American and Hispanic areas have the highest densities of such advertising, while white areas have the lowest. Researchers have been comparing the locations of different food out- lets with ethnic concentrations, food preferences, and obesity rates. For example, a study in Austin (Texas), New York City, Philadelphia, and Los Angeles found that alcoholic beverages were the most advertised item in all four locations; fast food was the second most advertised item; and the largest number of ads for alcoholic beverages and fast food was in an African American and Hispanic, low-income zip code in Austin (Yancey et al., 2009). A major question is which comes first—the development of an infra- structure for healthy living or the development of a population demand for healthy living. And are multicultural food and beverage brand preferences driven by marketing, or are marketing strategies designed to capitalize on food and beverage brand preferences? The available research indicates that causation occurs in both directions. 7  Available online at http://www.asksmartypants.com.

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22 CHANGE IN FOOD MARKETING TO CHILDREN AND YOUTH The Ethics of Targeted Marketing People from different stakeholder communities, whether public health, industry, or academia, have different perspectives on the ethics of targeted marketing of foods and beverages. Williams explained that one argument used by many businesses to justify targeting is that it directs resources to communities that historically have been neglected. In addition, arguments against targeting, such as the idea of prohibiting fast-food restaurants in particular neighborhoods, can appear paternalistic. People need to feel that their rights to vote in the marketplace are not being denied. However, major changes in marketing practices have taken place. Marketing occurs in more venues; using more techniques; and through more media vehicles, including the Internet, videogames, and cell phones. Marketing of specific products has given way to marketing of corporate brands. On the positive side, legal advocacy and community engagement have the potential to counter marketing targeted to ethnic minority youth. And an emphasis on business ethics could move companies toward a triple b ­ ottom line—measuring themselves based on social, economic, and envi- ronmental goals—thus offering opportunities for companies concerned with negative effects of targeted marketing. “This [the buying power of African American and Hispanic com- munities] is really where [marketers] want to spend and target their money. They are not as much concerned about the health consequences.” —Jerome D. Williams