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February 28, 2005
De-Scent into Madness
Is this the smell of victory for the shopping mall chains?
Yesterday's Washington Post reported on a study which found that shoppers spent $20 more per outing when under the influence of a citrus aroma.
What will the marketeers do next? Will they discover a scent to make us surrender all our money?
Here's yesterday's Washington Post article:
http://www.washingtonpost.com/ac2/wp-dyn/A55190-2005Feb26?language=printer
Dollars and Scents
By Richard Morin
What do profits smell like?
Like oranges with a hint of lemon, say three business professors who studied how various scents affected buying patterns.
Under certain conditions, a citrus smell seemed to magically open the pocketbooks of shoppers and increase their desire to spend, according to Jean-Charles Chebat of the HEC Montreal graduate school of business, Richard Michon of Ryerson University in Toronto and L.W. Turley of Western Kentucky University. Their findings appear in the latest issue of the Journal of Business Research.
But retailers with a nose for sales should not order industrial-size vaporizers and fill them with orange scent just yet. The researchers cautioned that the citrus smell provoked additional spending only if stores were moderately busy. If they were too crowded or too empty, the power of citrus disappeared. "Crowds have their own smells," Chebat said in an e-mail. "Citrus can counterbalance the effects of such smells to a certain extent. However, it has its limitations. As for the least crowded environments, citrus may be too arousing."
Researchers have known for years that external stimuli can subconsciously affect how eager we are to buy, and our emotions can be enhanced or suppressed by our surroundings. The impact of background music on shoppers is well documented: Loud rock music, for example, seems to encourage quick decisions and impulse buys while softer sounds keep people in the store longer. Lighting, too, can affect buyers' moods by making them feel better -- or worse -- about the shopping environment.
But until now, few people have studied how smell influences shoppers, Michon said. One reason is that retailers and researchers agree that the effect of an ambient odor is powerful but difficult to predict. In fact, psychologists believe that smell is the most powerful of the five senses in provoking both strongly positive and negative emotional reactions.
Another reason: It's so hard to test how smell impacts shopping decisions because it's hard to replicate real buying conditions in a laboratory. So these researchers took the experiment out of the lab and into the mall, conducting a novel real-life test of their theories at a shopping center near Montreal.
They set up a series of six scent stations around the mall. The stations remained in place for three weeks. Each week each station would diffuse one of two scents around the mall, taking care to make the odor just "below the threshold of awareness," Chebat said. The citrus scent -- a mix of orange, lemon and mandarin -- was dispersed the first week, lavender the second, while data was collected under normal conditions on a third week to provide a baseline for comparison. Several hundred shoppers were asked to answer a questionnaire that helped the researchers evaluate perceptions of products, the mood of the shoppers, the overall impressions of the mall and the amount of merchandise purchased under different scent conditions.
They found that shoppers who sniffed the citrus scent during the first week were more likely to view the mall as livelier, more pleasant and more stimulating (the lavender bouquet produced a marginally positive reaction). These citrus-enhanced feelings were money in the bank for the retailers: Under the heady influence of the aroma, each shopper spent about $20 U.S. more per outing, the research team reported.
Posted by Gary Ruskin at 07:44 PM | Comments (0)
February 27, 2005
Self-Regulation of Advertising to Children is a Sham
Today's Washington Post has a fine article on the failures and limitations of the Children's Advertsing Review Unit, which is the advertising industry's self-regulatory body regarding advertising to children.
The main purpose of CARU is to act as a fig leaf to help the ad industry claim that it treats children responsibly. At the same time, the industry has loosed on our children a flood of ads promoting violence, anti-social behavior, boorishness, and materialism. And it has created in our children an epidemic of marketing-related diseases, such as obesity, type 2 diabetes, alcoholism (and millions will eventually die from the marketing of tobacco.)
CARU and other self-regulation schemes are a failure. The best solution to advertising to children is the Parents' Bill of Rights, a set of nine legislative proposals to restore to parents some control over the commercial influences on our children.
Here is today's Washington Post article.
http://www.washingtonpost.com/wp-dyn/articles/A55226-2005Feb26.html
Minding Nemo; Pitches to Kids Feed Debate About a Watchdog
by Caroline E. Mayer
NEW YORK -- Unlike most people watching taped television shows, Tina Poturica doesn't zap through the commercials. In fact, the ads are all she looks at because her job is monitoring promotions aimed at children under 12 to make sure they are accurate and age-appropriate.
One recent morning, Poturica -- remote control in one hand, pen and legal pad nearby -- zipped through five hours of taped afternoon shows from a cable cartoon network. She slowed the tape to study pitches for cereal, snacks and toys. A new ad for a kid's fast-food meal caught her eye enough that she watched it three times. It featured only the chain's highest-calorie products (double cheeseburger, fries, soda) and not some of its recently introduced, more-nutritious alternatives. "Will a kid think they can only get the toy if they order the highest-calorie products?" Poturica wondered. So she fired off a letter to the company, requesting that it feature some of the more healthful products in future ads.
When health professionals and consumer activists call for greater government oversight of ads and promotions aimed at kids because of growing levels of childhood obesity, the food and advertising industries point to Poturica's employer, the Children's Advertising Review Unit, which analyzes 1,000 TV commercials, 250 magazine ads and countless Web sites each month.
"Our self-regulatory system is an active cop on the beat," said Robert D. Liodice, president of the Association of National Advertisers Inc., one of the three ad industry associations that, along with the Council of Better Business Bureaus, created the review unit, CARU. The group's supporters note that in the past two years, advertisers complied with the unit's requests in all but six of 222 cases.
Critics say CARU, with a staff of six and a $650,000 annual budget, can't keep up with $15 billion in promotions that companies aim at kids each year.
They say the group's efforts are hindered by guidelines that are too narrow, enforcement powers that are too weak, and the basic conflict that it is an industry group. There are no consumer group representatives on the 25-member board, and some of the six academic board members have consulted for advertisers and major corporations.
The group was set up in 1974 after the Federal Trade Commission threatened to start regulating children's ads -- the main concerns at the time were sweetened cereals and vitamins -- if the industry didn't.
On paper, CARU's mission "looks great," said Enola Aird, who has studied the unit as director of the Motherhood Project at a New York nonprofit. "But it really doesn't work to protect children because there are so many loopholes." For one thing, she said, by the time the group files a complaint and gets an answer, many of the ads have already completed their run "and they've already had their effect" on children.
CARU "says it is a watchdog, but it is empowered to do things so small you need a scanning electron microscope to see it," said Gary Ruskin, executive director of Commercial Alert, founded by Ralph Nader to monitor advertising, particularly ads aimed at kids.
Aird and Ruskin cited one of the group's main limitations -- that it monitors ads, but not the many other marketing techniques companies use. For example, CARU doesn't review corporate-sponsored "advergaming," where kids can play online games featuring Twinkies, Cheetos or Life Savers. Nor does it monitor school promotions, such as fundraisers at Chuck E. Cheese's restaurants or contests sponsored by candy companies to raise money for schools.
Also outside the group's purview are special marketing events, such as Camp Geoffrey, the Toys R Us in-store summer activity program for 3- to 8-year-olds. So too are viral marketing campaigns, in which companies sponsor sleepovers or use the Internet to recruit kids to spread the good word about their products.
Margo G. Wootan, director of nutrition policy at the Center for Science in the Public Interest, said CARU should more aggressively police food ads aimed at children to limit junk food ads. "Their guidelines deal mostly with deception, but they don't deal with the nutritional qualities of food," she said.
CARU guidelines note that the appearance of a live or animated character such as SpongeBob SquarePants "can significantly alter a child's perception of the product," but they do not restrict the use of these characters in either the ads or the products themselves. So such products as SpongeBob cereal, Shrek-colored M&M's and Scooby-Doo! crackers are proliferating on store shelves.
"If characters are all that powerful, they shouldn't be used at all," Wootan said.
Advertising officials are quick to rebut the critics. "I challenge the critics to provide me with a direct and causal link between children's advertising and childhood obesity," Liodice said.
CARU Director Elizabeth L. Lascoutx said her group's purpose is "to ensure that advertising directed to children is truthful, accurate and appropriate for its intended audience. It was never intended that CARU be the arbiter of what products should or should not be manufactured or sold, or to decide what foods are 'healthy,' to tell parents or children what they should or shouldn't buy."
Even so, the organization is now playing a more active role in promoting nutritional products. "When they didn't have alternatives, we couldn't say, 'You can't advertise that.' But now they have alternatives and they should be showing these."
CARU also is reviewing its definition of advertising to encompass more-subtle promotions, such as those in advergames, to make sure kids know when a product is being pitched. Any change would require companies to more clearly delineate when a product is being promoted in online games and magazines .
The government has placed some restrictions on children's ads. The Federal Communications Commission requires broadcasting networks to clearly delineate between program content and commercial messages on children's shows, and bars ads with character endorsements from running during or immediately adjacent to that character's show. There are also limits on the amount of advertising that can be aired during children's shows: 10.5 minutes during an hour-long program on weekends, 12 minutes per hour show during the week. There are no such limits for adult shows.
CARU's 14-page guidelines include such directives as "Snack foods should be clearly represented as such, and not as substitutes for meals." Others say the amount of a featured product "should be within reasonable levels" and should encourage good nutritional practices.
Those rules led to a finding last April against Procter & Gamble for its ad showing four friends playing music with -- and eating out of -- multiple cans of Pringles. CARU said a single container should have been sufficient to serve all four kids. While P&G said the cans were featured as fun, and consumption was responsibly shown, it agreed to stop running the ad during children's shows.
More recently, in October, Unilever United States Inc. agreed to change future ads for Popsicle Scribblers Real Juice Pops after CARU complained that children "could reasonably take away the message that the pops consisted entirely or mostly of real fruit juice, although the pops only contained 20 percent fruit juice."
More than 90 percent of the times that CARU questions an ad, the questions are initiated by CARU staff. In the 14 years that Lascoutx has been at the group, she said, only 10 actions were prompted by complaints from competing firms, and fewer than 10 were sparked by consumers. CARU's critics say that's because the organization doesn't aggressively publicize its existence; parents would file more complaints if they knew there was an advertising review unit and how to contact it. (The Children's Advertising Review Unit can be reached at 70 W. 36th St., 13th floor, New York, N.Y 10018, or by e-mail at caru@caru.bbb.org.)
In most of the challenged cases, companies agree to change ads, even if they disagree with the organization's concerns. But if companies refuse to comply, there's little the group can do. In some cases, when CARU contended ads violated federal laws, CARU notified government agencies such as the FTC, which cracks down on misleading and deceptive ads. Otherwise, "we can only issue press releases saying they didn't comply," Lascoutx said.
For example, just a few commercials after the fast-food ad Poturica challenged, she saw one she knew only too well. It was for a chocolate fondue and candy-making set called the Original Chocolate Factory. It featured chocolate melting on a double boiler on a hot stove. Some scenes showed hands dipping strawberries and crackers directly into the double boiler.
Last August, CARU issued a press release saying the ad violated its guidelines because the product was inappropriate for children under 12 and showed children in an unsafe situation. The advertiser agreed that the product was inappropriate for children and agreed to slightly modify the ad, CARU said, but continued running it on a cartoon network on the assumption parents or adult caregivers might be watching with their kids.
"There was nothing we could do," Lascoutx said. "It happens, but rarely."
Posted by Gary Ruskin at 12:43 PM | Comments (0)
February 26, 2005
Marketers Peer Into Our Brains to Sell, Sell, Sell
Tomorrow's Los Angeles Times has a front page article on neuromarketing -- the use of fMRIs not for healing but for marketing purposes.
The article has excellent reporting of what some neuromarketers are actually do. But it doesn't well explain the core problem of neuromarketing: what happens if it makes commercial and political propaganda more effective?
This is no trivial matter. If neuromarketing really makes propaganda more effective, then the implications are serious, because it could lead to more marketing-related diseases, and the stirring up of ethnic & racial hatreds, totalitarianism, fascism, and genocide.
It's long past time for some Members of Congress to stand up and demand hearings on the implications of neuromarketing.
Here's the Los Angeles Times article.
http://www.latimes.com/news/science/la-sci-brain27feb27,0,3899978.story?coll=la-home-headlines
Mapping the Mind; Searching for the Why of Buy
Researchers scan for insight into how marketing may brand the brain's preference for products and politicians.
by Robert Lee Hotz
Pictures of products danced in his head.
There was an Apple iPod, then a black Aeron chair. A coffeepot by Capresso and a washing machine by Dyson. Christian Dior followed by Versace, Oakley, Honda, Evian and Louis Vuitton.
Each icon of commercial design — 140 in all — was projected onto goggles covering the eyes of a 54-year-old, college-educated, middle-class white male.
The volunteer's head was cradled inside a 12-ton medical imaging scanner at Caltech, held firmly in place at the focal point of a pulsing magnetic field. The chamber reverberated with a 110-decibel sandblaster roar.
Behind a double-thickness of shatterproof glass, Steve Quartz, 42, and Anette Asp, 28, monitored the flicker of his thoughts in color-coded swirls on a computer display.
The two Caltech researchers were investigating the effect of perhaps the most pervasive force in a consumer culture — marketing — on the most complex object in the world: the human brain.
Quartz, director of the school's social cognitive neuroscience laboratory, and Asp, his project manager, were seeking evidence in the subject's brain of an all but indefinable quality of fashion and product branding — the subjective essence that makes an object irresistibly cool.
As the magnetic signals hammered the air, the subject's brain told them things that his mind did not know.
Psychologists and economists are using sophisticated brain scanners to tease apart the automatic judgments that dart below the surface of awareness.
They seek to understand the cellular sweetness of rewards and the biology of brand consciousness. In the process, they are gleaning hints as to how our synapses might be manipulated to boost sales, generate fads or even win votes for political candidates.
They have glimpsed how the brain assembles belief.
The why of buy is a trillion-dollar question.
By one estimate, 700 new products are introduced every day. Last year, 26,893 new food and household products materialized on store shelves around the world, including 115 deodorants, 187 breakfast cereals and 303 women's fragrances. In all, 2 million brands vie for attention.
To find profit in so many similar items, marketers attempt to brand a product on a buyer's mind. Such efforts put the average American adult in the crosshairs of as many as 3,000 advertising messages a day — five times more than two decades ago.
Children are exposed to 40,000 commercials every year. By the age of 18 months, they can recognize logos. By 10, they have memorized 300 to 400 brands, according to Boston College sociologist Juliet B. Schor. The average adult can recognize thousands.
"We are embedded in an enormous sea of cultural messages, the neural influences of which we poorly understand," said neuroscientist Read Montague, director of the Human Neuroimaging Laboratory at Baylor College of Medicine in Houston. "We don't understand the way in which messages can gain control over our behavior."
That is starting to change. By monitoring brain activity directly, researchers are discovering the unexpected ways in which the brain makes up the mind.
Many seemingly rational decisions are reflexive snap judgments, shaped by networks of neurons acting in concert. These orchestras of cells are surprisingly malleable, readily responding to the influence of experience.
Moreover, researchers suspect that the inescapable influence of marketing does more than change minds. It may alter the brain.
Just as practicing the piano or learning to read can physically alter areas of the cerebral cortex, the intense, repetitive stimulation of marketing might shape susceptible brain circuits involved in decision-making.
These inquiries into consumer behavior harness techniques pioneered for medical diagnosis: positron emission tomography, which measures the brain's chemical activity; magneto-encephalography, which measures the brain's magnetic fields; and functional magnetic resonance imaging, which measures blood flow around working neurons.
"This is a way of prying open the box and seeing what is inside," said psychologist Jonathan Cohen, director of Princeton University's Center for the Study of Brain, Mind & Behavior.
Inside the Caltech scanner, faces flashed before the subject's eyes.
Each one was famous — an easily recognized emblem of celebrity marketed as heavily as any designer label.
Each triggered a response in the volunteer's brain, recorded by Quartz and Asp with Caltech's $2.5-million functional magnetic resonance imager (fMRI) and then weighed against the volunteer's responses to a 14-page questionnaire.
Uma Thurman. Cool.
Barbra Streisand. Uncool.
Justin Timberlake. Uncool.
Al Pacino. Cool.
Patrick Swayze. Very uncool.
The volunteer's brain cells became a focus group.
In his mind's eye, the celebrities triggered many of the same circuits as images of shoes, cars, chairs, wristwatches, sunglasses, handbags and water bottles.
For all their differences, objects and celebrity faces were reduced to a common denominator: a spasm of synapses in a part of the cortex called Brodmann's area 10, a region associated with a sense of identity and social image.
"On first pass, there might seem to be nothing in common between cool sunglasses, cool dishwashers and cool people," Asp said. "But there is something that these brains are recognizing — some common dimension."
None of these neural responses may come consciously to mind when a shopper is browsing brand labels.
Much of what was traditionally considered the product of logic and deliberation is actually driven by primitive brain systems responsible for emotional responses — automatic processes that evolved to manage conflicts between sex, hunger, thirst and the other elemental appetites of survival.
In recent years, researchers have discovered that regions such as the amygdala, the hippocampus and the hypothalamus are dynamic switchboards that blend memory, emotions and biochemical triggers. These interconnected neurons shape the ways that fear, panic, exhilaration and social pressure influence the choices that people make.
As researchers have learned to map the anatomy of behavior, they realized that the brain — a 3-pound constellation of relationships between billions of cells, shaped by the interplay of genes and environment — is more malleable than anyone had guessed.
Lattices of neurons are linked by pathways forged, then continually revised, by experience. So intimate is this feedback that there is no way to separate the brain's neural structure from the influence of the world that surrounds it.
In that sense, some people may indeed be born to shop; but others may be molded into consumers.
"We think there are branded brains," Asp said.
The Caltech experiment, funded with a $1-million grant from the David and Lucille Packard Foundation, seemed to detect a part of the brain susceptible to such influences.
After analyzing test datafrom 21 men and women, Quartz and Asp discovered that consumer products triggered distinctive brain patterns that allowed them to classify peoplein broad psychological categories.
At one extreme were people whose brains responded intensely to "cool" products and celebrities with bursts of activity in Brodmann's area 10 — but reacted not at all to the "uncool" displays.
The scientists dubbed these people "cool fools," likely to be impulsive or compulsive shoppers.
At the other extreme were people whose brains reacted only to the unstylish items, a pattern that fits well with people who tend to be anxious, apprehensive or neurotic, Quartzsaid.
The reaction in both sets of brains was intense. The brains reflexively sought to fulfill desires or avoid humiliation.
Asp, a Swedish researcher who once majored in industrial design, volunteered for the fMRI probe. The scanner revealed a personality quite at odds with her own sense of self.
She searched the scanner's images for the excited neurons in her prefrontal cortex that would reflect her enthusiasm for Prada and other high-fashion goods. Instead, the scanner detected the agitation in brain areas associated with anxiety and pain, suggesting she found it embarrassing to be seen in something insufficiently stylish.
It was fear, not admiration, that motivated her fashion sense.
"I thought I would be a cool fool," she said. "I was very uncool."
Inside the brain of the 54-year-old male volunteer, the sight of a desirable product triggered an involuntary surge of synapses in the motor cerebellum that ordinarily orchestrate the movement of a hand.
Without his mind being aware of it, his brain had started to reach out.
Deconstructing the anatomy of choice, the researchers are also probing the pliable neural circuits of reasoning and problem-solving — the last of the brain's regions to evolve, the last to mature during childhood, and the most susceptible to outside influences.
They have begun to obtain the first direct glimpses of how marketing can affect the structures of the brain.
Consider something as simple as a choice of soft drink.
At Baylor College of Medicine, Montague, 44, remembered telling his 17-year-old daughter: Let's give the brain the Pepsi Challenge.
His daughter had been working as a summer intern in his Baylor laboratory. To give her a taste of practical neuroscience at work, he wanted to frame a research question that a teenager "could wrap her head around."
Since 1999, consumers have been offered 545 new brands of carbonated beverages. Despite differences in taste, color, caffeine and fizz, they are all based on a single sensory theme: sugar and water.
What happens in the brain, Montague wondered, when people decide between Coca-Cola and Pepsi, two of the most popular — and most similar — soft drinks in the world?
With funding from the Kane Family Foundation and the National Institute on Drug Abuse, they designed an experiment that became a test of the relative importance of the label on a cola can and the contents of the container.
Coca-Cola, in the words of one industry analyst, is "advertising incarnate." The company was the first sponsor of the Olympic Games, gave its cola free to U.S. soldiers during World War II, and is credited with inventing the modern image of Santa Claus.
Against such a formidable competitor, Pepsi was able to transform itself from a bankrupt company in the 1930s into a $69-billion enterprise today, largely through marketing.
In all, 67 people took the 47-minute test inside Baylor's fMRI machine.
Each swallowed sips of cola from a tube in a series of carefully calculated variations on the classic taste test. Each sip was preceded by a picture of a distinctively labeled red or blue cola can. Montague and his colleagues varied the order of the sodas, the labels and the timing of the sequence.
The volunteers had no preference when the drinks were offered unlabeled, the researchers discovered. But they overwhelmingly preferred Coke whenever that brand was displayed — no matter what cola was actually delivered through the sip tubes.
When the researchers analyzed the brain scans, they discovered that the Coke label appeared to activate a memory region called the hippocampus, along with structures in the midbrain known to compute the likelihood of rewards.
A brain region linked to the sense of self — the ventral putamen and the medial prefrontal cortex — also lighted up.
The Pepsi label prompted no such response.
"What is it about these two almost chemically identical drinks that causes such different behavior?" asked Baylor neuroscientist Damon Tomlin. "The answer, of course, is marketing."
While Pepsi's marketing campaign has been successful, it apparently has not reached as deeply as Coke's.
Montague elaborated: "We can show that the idea of Coca-Cola activates structures in your midbrain that literally drive your behavior. That is how ideas gain control over instinct."
The study is a first step, he said, in the effort to answer a more fundamental scientific question: "Why do we believe anything?"
The creation of belief is the essence of marketing.
Brain scanning has opened the possibility of new forms of manipulation, by charting ways for marketing savants to harness neural circuits of reward and desire more effectively.
In Atlanta, a consulting organization called the BrightHouse Neurostrategies Group launched the first neuromarketing company in 2002, promising in a press release "to unlock the consumer mind." The company, whose clients include the Home Depot, Hitachi, Georgia-Pacific and the Metropolitan Museum of Art, has conducted experiments with neuroscientists at Emory University in an effort to understand product preferences.
Justine Meaux, the company's director of research, said BrightHouse helped businesses apply neuroscience to marketing, brand development and product innovation.
"It is fantastically relevant research," Meaux said. "A few companies are at the stage where they want to incorporate it into their strategy." She declined to name them.
In Los Angeles, Quartz and his Caltech colleagues have been negotiating with a marketing company called Lieberman Research Worldwide to find a way to sell brain-scanning services to advertisers.
"Our intent is to develop some type of strategic alliance that would develop tools and perhaps products for marketing-research users, based on the work Steve's doing," said Tim McPartlin, a senior vice president with the company. "It looks extremely useful to us."
At the Open University in England and London Business School, researchers have been recording brain activity as shoppers tour a virtual store. The researchers say they have identified the neural region that becomes active when a shopper decides which product to pluck from a supermarket shelf.
In Germany, DaimlerChrysler Corp. used brain imaging to assess how young men responded to different car designs. In Japan, researchers at Nihon University and the Gallup Organization used brain scanning to probe customer loyalties to a Tokyo department store.
Many researchers are skeptical of efforts to commercialize insights into how the brain works.
"Right now, brain scanning, especially at the level of neuromarketing, is to some degree a matter of tea leaf reading," said George Lowenstein, a behavioral economist at Carnegie Mellon University.
Nevertheless, a consumer group called Commercial Alert sought a congressional investigation of neuromarketing research last year.
"What would happen in this country if corporate marketers and political consultants could literally peer inside our brains, and chart the neural activity that leads to our selections in the supermarket and the voting booth?" asked Gary Ruskin, the group's executive director, in a letter to the Senate Committee on Commerce, Science and Transportation.
"What if they then could trigger this neural activity by various means, so as to modify our behavior to serve their own ends?"
Already, some researchers have experimented with brain scanning as a way to probe how the brain responds to political advertising.
At the level of brain cells, sophisticated political arguments and party loyalties are reduced, like product preferences, to the activity of neural circuits honed by eons of evolution.
Research suggests that political beliefs appear to trigger the same malleable circuits of reward, identity, desire and threat.
In a series of unpublished experiments conducted during the recent presidential campaign, UCLA neuroscientist Marco Iacoboni detected intriguing differences in how political brains react. It was the first time brain scanning had been used to study a political question, several experts said.
To 13 volunteers screened for political expertise and party loyalty, Iacoboni showed pictures of Sen. John F. Kerry, President Bush and Ralph Nader while recording their neural activity. He then screened footage for them from Republican and Democratic campaign ads.
Afterward, he recorded how their neural responses changed when they were shown the same faces a second time.
Not surprisingly, Iacoboni found that people watching their favored candidate responded with a surge of activity in the reward circuits of the brain.
Republican die-hards, however, seemed to have a strong positive emotional response to any prominent leader.
The Bush campaign ads appeared to change those Republican brain patterns by stimulating activity in areas involved in more rational deliberation, Iacoboni said.
Shown campaign advertising that touched on the Sept. 11, 2001, terrorist attacks, Republicans and Democrats again had different responses.
"The Democrats had a big response in the amygdala — the anxiety threat detector and bell-ringer in the brain," said UCLA psychiatrist Joshua Freedman, who helped organize the experiment. "Republicans did not have a statistically significant response to that, for whatever reason."
The findings suggest that brain scanners, like focus groups and polling, could someday be a potent tool in probing voter preferences and the impact of campaign ads.
"When we start asking questions about somebody's political disposition and their brain responses, then we start making interpretations about what defines us as people," said Judy Illes, a senior research scholar at the Stanford Center for Biomedical Ethics.
"That might have some potentially scary possibilities for misuse," she said.
The research also undercuts traditional beliefs about the relationship between the brain and the mind, between the body and its intangible well of being, Illes said. In the process, personality becomes little more than an accidental byproduct of biology, a pattern of spots on a brain image.
"We are starting to probe neural signatures of preference ... one of those things that make us uniquely individual. We have to be careful," Illes said. "We are far more than the sum of our spots."
Posted by Gary Ruskin at 07:03 PM | Comments (2)
February 23, 2005
This Pepto-Bismol Ad Will Make You Sick
Part of the problem with corporate advertisers is: there is nothing they won't trample. They respect nothing. Nothing is sacred. Anything can be converted into a prop to sell widgets or whatever. Today's Washington Post has an excellent (and sickening) article about the cynical use of Black History Month to promote Pepto-Bismol, Metamucil and K-Mart.
We hope that people will boycott these brands; companies that show no respect deserve no sales.
Here is today's Washington Post article.
http://www.washingtonpost.com/ac2/wp-dyn/A48571-2005Feb23?language=printer
Black History and Ads Don't Mix, Activists Say
By Avis Thomas-Lester
The green and yellow flier from the Kmart in Aspen Hill proclaimed, "Celebrate Black History" and then advertised "3 for $1 Jiffy Corn Muffin Mix" and "3 for $10 Tone 6-Bar Soap."
The makers of Metamucil and Pepto-Bismol ran a full-page ad in this month's Ebony magazine declaring, "Black History Month is a legacy of pride and achievement leading to a healthier tomorrow." The ad continues, "It's the same ideals you turn to when it comes to your GI Health -- a history of digestive solutions."
The advertisements are among dozens that tout laxatives, cars, even yoga classes under the guise of paying homage to African American history. Educators and some civil rights activists say they are bothered by what they consider exploitation of a season meant to honor the contributions of black Americans. But marketing experts say the trend is not surprising in a nation that once considered draping advertising banners across the base of the Statue of Liberty.
"Eventually any piece of history or American culture gets trivialized by advertisers," said Barbara Lippert, the advertising critic for Adweek magazine. "They just use any opportunity as a platform to sell something. . . . Everything becomes about buying and selling."
Activist Jesse L. Jackson said that some of the ads are produced by the same companies that "denied access" to blacks and that they trivialize the historic struggle.
"What pains me is that these ads are feel-good sessions about a black general who did this or someone who sang a song or a political figure who worked on this, and 'Aren't there some wonderful black people?' " he said. "Of course that is true, but they don't deal with issues like . . . why black people work as hard and make less, why black people are stressed out and don't live as long."
Deena Barlev, who teaches a civil rights course at a Montgomery County middle school, was heading into Kmart to buy socks on sale when she saw the flier.
"I was thinking the store was celebrating Black History Month. Then I looked further down the flier and saw that they were advertising Tone bar soap . . . and cornbread mix," Barlev said. "I thought, 'No, they didn't!' "
In a statement, Kmart officials said the fliers are a "celebration of the contributions African Americans have made to America's history." The statement said the store is sponsoring a "scholarship sweepstakes" in which entrants can vie for a $20,000 certificate of deposit. The company also "incorporates special sale pricing of popular items."
In the District, U Street Yoga is advertising a "Black History Month Yoga Class" to "encourage African Americans to embrace their heritage through yoga, which has roots in African culture."
Black History Month, celebrated in February, got its start in the 1920s as Negro History Week, when D.C. historian Carter G. Woodson sought to encourage teachers to include contributions by African Americans in their history lessons.
Advertisers began linking their marketing efforts to the celebration years ago, Lippert said, recalling an ad that used a digitally altered scene of Martin Luther King Jr. delivering his "I Have a Dream" speech at the Lincoln Memorial to sell telecommunications products.
Lippert said advertisers have a long history of "exploiting" history to sell products. A company that manufactured the children's laxative Fletcher's Castoria proposed hanging a banner with its name on the pedestal of the Statue of Liberty in exchange for paying into the statue's construction, she said.
Some advertisers link their ads to a charitable cause, but Lippert said many are token donations. "They jump on these teeny charitable donations to be able to exploit [the holiday], then turn around and say, 'Exploit? We don't exploit.' "
Many ads pay tribute to black history without mentioning a product. Toyota ran an ad this month honoring Philip Emeagwali, who in 1975 "theorized the HyperBall International Network of computers. Today, we call it the Internet."
Wal-Mart's ads celebrate the "Buffalo Soldiers." A McDonald's newspaper ad spotlighted exceptional students at Friendship Edison Public Charter School in the District.
In ads this month in Ebony and Jet magazines, Ford Motor Co. takes credit for improving the lot of black Americans:"Henry Ford recognized the value of a skilled workforce -- regardless of race. And when Ford . . . became the first major corporation to pay African American workers equal pay for equal work, it helped give birth to the Black middle class."
Ford spokesman Mitchell Johnson said the firm was among the first to hire blacks into high-paying jobs, helping to spur the migration of African Americans from the South to the North. "We want to be out there on the forefront because of our heritage of supporting the communities we do business with," he said.
Other ads -- such as the Procter & Gamble ad for Metamucil, Pepto-Bismol and Prilosec -- refer directly to products.
Vince Hudson, marketing director for the company's "GI brands," said the ad was intended to show a connection between the progress blacks have made in society and in improving their health. "We are celebrating all the contributions African Americans have made and the rich history and traditions," said Hudson, who is black. "This ad is a salute to that from brands that have been there throughout the history, also."
Lawrence Guyot, a civil rights activist who once led the Mississippi Freedom Democratic Party, said black history "should not be ground into the economic acquisition machine."
Researchers Meg Smith and Bobbye Pratt contributed to this report.
Posted by Gary Ruskin at 08:56 PM | Comments (3)
February 22, 2005
Corporate Predator Neopets Plans Expansion
Neopets.com, which submerges children in a world of "immersive advertising" for companies such as McDonald's (when American children are suffering from an epidemic of obesity), is planning a large expansion, according to an article in today's Wall Street Journal.
The Federal Trade Commission should prohibit Neopets from using "immersive advertising" as an unfair and deceptive form of advertising targeting our children. So many children cannot understand or defend themselves against Neopets' sophisticated marketing strategies.
Here's today's Wall Street Journal article.
http://online.wsj.com/article/0,,SB110903247669660414,00.html
Web's Addictive Neopets Are Ready for Big Career Leap
By Nick Wingfield
David Carliner, a Maplewood, N.J., 10-year-old, isn't supposed to use his computer Mondays through Thursdays. But he has been sneaking online recently to complete a brief but important mission: feeding a small menagerie of virtual pets on Neopets.com.
"I feed them until they're bloated so they'll be full for a couple of days," the fourth-grader says.
In the 1990s, Tamagotchi pets taught kids how to care for virtual critters that inhabited small, egg-shaped electronic gadgets. During the past several years, Neopets Inc. has quietly taken the phenomenon to new extremes with a vast online world that is one of the most popular and addictive Web sites among kids. Users of the site become custodians of colorful, cartoon-like critters in Neopia, an imaginary world with its own currency (Neopoints), stock market (the Neodaq) and weather system. Users also get a dose of product plugs from companies such as General Mills Inc. and McDonald's Corp.
In coming years, parents may see and hear a lot more about Neopets, as the creatures march off computer screens and into toy stores, videogames and even movie theaters -- a rare leap for characters that originated on the Internet. And Neopets is stepping up efforts to make money from the huge volume of traffic on its free Web site by signing licensing deals and selling ads, which are already stirring up controversy among some parents and watchdog groups.
Neopets Inc. is in talks to develop videogames, cellphone games and even a feature film for the virtual menagerie.
Most of Neopets' revenue comes from advertising, both banner ads and a form Neopets calls "immersive advertising" (it has even trademarked the term). Immersive ads are branded games on the Web site in which the brand and the message are inseparable from the rest of the content. One example: "Chocolate Lucky Charms: Mine Car Chase," a game in which players earn points by snapping up pieces of breakfast cereal.
Neopets declines to say how much General Mills, the maker of Lucky Charms cereal, paid for the brand exposure in the game. Online ads contribute 60% of Neopets' annual revenue, which is in the "eight figures," says Doug Dohring, Neopets' chairman and chief executive.
Offline businesses contribute the remaining 40%. Retailers such as Target Corp. sell Neopets plush toys, trading cards and jewelry. McDonald's Corp. gave away Neopets toys and cards with Happy Meals last year. Sony Corp. is developing a Neopets videogame for its PlayStation 2 and PSP consoles. Neopets is talking to game makers about delivering Neopets characters to cellphones, and in what may be its biggest partnership yet, the company says it is close to a deal with a Hollywood studio for a computer-animated Neopets movie.
"Neopets is really the only example of media I've seen that started online that might have the ability to capture market share in the offline world," says Quincy Smith, an investment banker at Allen & Co. in New York, which represents Neopets in discussions with potential partners.
Retailers and promotional partners warn against dismissing Neopets as just another kid fad. Mr. Dohring has "been very conscientious about building long-term awareness," says Paula Damaso, an executive vice president at Too Inc.'s Limited Too, which sells Neopets merchandise.
Like all media aimed at kids, Neopets is likely to come under more scrutiny as it sells more advertising. Online games incorporating brands of fast food, snacks and other kid-targeted products have rankled some watchdog groups. Such content should be clearly labeled as advertising, says Gary Ruskin, executive director of Commercial Alert, a nonprofit group founded by Ralph Nader.
Neopets' Mr. Dohring says immersive ads on the Neopets site are identified as advertising. On the page where users start the Lucky Charms game, for instance, a small-type disclaimer says the game is an ad, but no such message is within the game itself. Mr. Dohring says there is less advertising on Neopets.com than on many other Web sites. Neopets doesn't run ads on its home page, nor does it take pop-up ads.
Last fall in Australia, a parents group complained to McDonald's, Neopets' partner in a local promotion, saying games of chance found on Neopets.com were exposing children to gambling. In response, Neopets removed a handful of games from the Australian version of the Web site. "We were happy to accommodate them," says Stephanie Yost Cameron, Neopets' general counsel.
Neopets stands out among Web sites for its "stickiness," an industry term referring to how much time users spend on a site. During December, the 2.9 million visitors to Neopets.com spent on average more than three hours there, ranking the site fourth among all U.S. Internet users on that basis, according to measurement firm Nielsen//Netratings. That puts Neopets ahead of popular sites such as eBay and Yahoo. (Internet service providers AOL.com and Juno.com rank first and second respectively, with Electronic Arts' online gaming sites in third place.)
In contrast to many other online game sites, Neopets' audience is predominantly female. More than 25 million individuals around the world have created 90 million accounts on the site, the company estimates.
New users get started by providing their e-mail addresses and anonymous demographic information (users 13 and over are asked for their names), then selecting a Neopet to adopt; some of the critters, like the bovine Kau and the reptilian Krawk, vaguely resemble real animals. Users give their Neopets names, colors and preferred activities, such as "making friends" or "bullying others." Then users wander off to play games and fight other creatures inside the Battledome. The combat is decidedly bloodless: One weapon is a bent fork tied in a knot.
By playing games and doing other activities on the site, players earn Neopoints, a virtual currency they can use to buy food for their Neopets. Users are encouraged to visit often, whether to feed their Neopets or collect the virtual interest on the hoard of Neopoints many players amass. Neopets says it doesn't share e-mail addresses with marketers.
But there are no overall victors on the site. And Neopets that are left unfed don't die; they just become withered.
Some users become Neopets millionaires: Gordon Davidescu, a 27-year-old who works at a Starbucks in Seattle, has about two million Neopoints accumulated over three years of visiting the site. (Most Neopets users are under 18, but there is a sizable adult audience.) Mr. Davidescu also belongs to one of the many independent Neopets "guilds," online groups of like-minded Neopets users who share strategy and playing tips.
The site was launched on a lark in November 1999 by two British college students living in the U.S. Its rapid growth caught the attention of Mr. Dohring, at the time an entrepreneur who had previously founded a market-research company. Mr. Dohring and a group of other investors acquired the Neopets Web site with a plan to use it as a launch pad into other areas. "I saw what was beyond an Internet company, what was the makings of an entertainment and media company -- a mini-Disney," says Mr. Dohring. The games and animations are the product of about 60 animators, writers and other creative staff working at Neopets headquarters, in an office in Glendale, Calif.
Some users have complained about policies restricting discussions of certain topics on the Neopets site, including bans on religious and political postings. Discussions of the Sept. 11, 2001, terrorist attacks are banned, too. The religious prohibition has sparked online petitions from Christian, Jewish and wiccan Neopet users. Without such policies, Mr. Dohring says debates on the site could disrupt the fun of Neopets. "We don't want to allow things that could be controversial among the community," he says.
Mr. Dohring himself is a longtime member of the Church of Scientology. He says his own religious affiliation doesn't influence the content of the site, though he says he follows some of the administrative principles of L. Ron Hubbard, Scientology's founder, in running the business side of Neopets, which include guidelines for keeping track of statistics and decision-making within an organization.
<------article ends here------>
Here's an old news release from Neopets about their "immersive advertising" targeting children.
Business Wire December 5, 2000, Tuesday
NeoPets.com Launches Dramatic New Form of Internet Advertising, Results Far Exceed Expectations of National Accounts
NeoPets.com Inc. reports that results for major corporate sponsors over the past six months using a new, interactive form of advertising are broadly exceeding expectations.
Coining the term "immersive advertising" to describe this new advertising technique, the company has integrated sponsor products or messages into the popular activities and adventures of their site, NeoPets.com. Users at NeoPets.com interact directly with the sponsor's products, characters and messages for extended periods -- ensuring lasting impressions that can be easily measured.
By customizing campaigns to meet each advertiser's needs, NeoPets.com has demonstrated strong numbers of impressions and time statistics for their sponsors, exceeding expectations by as much as fourfold. This method of advertising is unique to the NeoPets site, and it dramatically expands the potentials for what advertising can achieve on the Internet.
Companies currently engaged in immersive advertising on NeoPets include Universal Studios' "The Grinch," Turner Broadcasting's Cartoon Network and Cartoon Orbit, Warner Bros.' "Pokemon: The Movie 2000," Watermark Press, Britannica and others.
The strength of these results is based on the success of the NeoPets site. With more than 4 million registered members, who according to PC Data Online spend an average of nearly 6 hours a month interacting with the site, NeoPets.com is by far the stickiest Gen Y community on the Web.
COO Lee Borth said, "We have developed immersive advertising to leverage our remarkable stickiness. Immersive advertising creates a lasting impression with our users, particularly so when compared to traditional magazine or TV ads (which may never be seen), or distractive banner ads that are frequently not even within the focus of the user.
"Because of the size of the site and the number of unique users aged 9-19, the opportunities with immersive advertising are unlimited."
NeoPets.com is not a novelty or game site, but rather a diversified, interactive Web community where new members create their NeoPet, and then select its name, color and traits such as personality, intelligence and special abilities.
With their NeoPets, Gen Y members enter Neopia, the virtual world of NeoPets.com, which contains forests, mountains, rivers, and villages -- each offering unique multi-layered activities. Members are constantly involved with the site, creating their own virtual activities, including commerce, entertainment, and interaction with other members.
Members can earn Neopoints, the free currency of the site, which enables them to buy virtual items in various shops, feed and care for their pet, participate in virtual auctions, and perhaps even play the stock market. The NeoPets' immersive advertising model guarantees what traditional ad programs cannot -- delivery of a client's message to its target audience.
NeoPets.com Inc., a privately-held company, is based in Glendale, Calif.
NeoPets.com Web site link http://www.neopets.com NeoPets.com press kit link http://demo.neopets.com/presskit/
CONTACT: M. Baybak & Co. Inc.
George Duggan, 818/542-6880
gduggan@nat-media.com
Posted by Gary Ruskin at 07:14 AM | Comments (25)
February 19, 2005
End the Movie Madness: Can We Get Other Local Elected Officials to Do This Too??
Our hero of the day is New York City Councilwoman Gale Brewer. She has just introduced legislation to require movie theaters to tell us when the movies start, not when the ads start.
It should be illegal for movie theaters to lie to us about movie times, so that they can hold us hostage and make us watch pre-movie ads.
We'd like to make Brewer's bill spread. You can help. Please ask your local elected officials to introduce this legislation too.
Here's yesterday's article in the New York Daily News:
http://nydailynews.com/front/v-pfriendly/story/282178p-241737c.htm
Coming distractions
By David Saltonstall
It's the latest horror at the movies: endless ads for everything from ladies' underwear to perfume to soda.
But a new City Council bill aims to set moviegoers free with a different kind of advertising - movie listings that reflect when movies actually begin, not the ads and previews before.
"We can't outlaw advertising," said City Councilwoman Gale Brewer (D-Manhattan), author of the bill. "But at least we can tell the industry that they have to be honest about when their movies start, not their ads."
She shouldn't have much trouble finding support among the city's film buffs, many of whom say they feel entrapped not by previews - which many like - but by the growing number of TV-like commercials that now precede most flicks.
"I didn't pay to see the ads," said Lorraine Lew, 33, a dietician from Queens, as she headed to the movies yesterday. "I paid to see the movies and the previews."
At one recent showing of the sleeper hit "Sideways" at the Loews 34th St. in Manhattan, for instance, seven ads - for everything from Coke to the Jamaica Tourist Board - competed with five previews. The result? The movie started 16 minutes after its advertised time.
If passed, Brewer's bill would require theaters to advertise the "actual start time" of any movie, not when ads and previews begin. Any theater that doesn't comply could face fines of $500 to $1,000 for each infraction.
Not surprisingly, the city's larger theater chains are giving two thumbs down to the idea, saying moviegoers know to expect "pre-feature content" at any movie.
"We believe that the public understands that the feature film starts sometime after the published showtime," said a statement from Loews Cineplex, which has 15 theaters in the five boroughs.
Some of the city's smaller, independent theaters don't have to be forced into providing truth in advertising. At the BAM Rose Cinemas in Brooklyn, for instance, movies start when advertised, and there are never any ads mixed among the previews. "We have to respect people's time," said theater manager Efi Shahar.
If passed, Brewer's bill would be a first in the nation.
"In the scheme of things, it isn't life or death," said Brewer. "But people shouldn't feel used after going to the movies."
Posted by Gary Ruskin at 06:58 AM | Comments (4)
February 13, 2005
Channel One's Big Troubles
Channel One is going through a bad time. Can it survive? This in-school marketing company, which compels 8 million kids to watch two minutes of ads each schoolday, has a long list of troubles. Here are two recent ones.
First, Channel One President Jim Ritts has quit. According to the Jack Myers Report, "Long-time Channel One top executive Jim Ritts has departed the Primedia-owned high school TV network even though he was telling friends just three months ago that he was "very happy" in the position. Ritts was the last remaining holdout from Channel One's original team put together by legendary entrepreneur Chris Whittle." (http://jackmyers.com/jmr/2005/01/13/jmr-01-13-05/)
Second, Jack Abramoff. Channel One's main Washington lobbyist, has quit, and is now under investigation by a federal grand jury, according to the Washington Post. This is very bad for Channel One, because it desperately needs political influence to keep its contracts with the federal government. Here's yesterday's Washngton Post update on the Abramoff saga.
http://www.washingtonpost.com/wp-dyn/articles/A17529-2005Feb11.html
Abramoff Ex-Firm Settles With Tribe; Former Lobbyist Was Paid Millions on Both Sides of Casino Issue
by Susan Schmidt
A Texas Indian tribe that paid $4.2 million to two Washington consultants for help reopening its casino -- while unaware that the same consultants had quietly worked to shut the casino down -- has reached a settlement with the law firm Greenberg Traurig, which employed one of the men.
Representatives of the Tigua tribe of El Paso said yesterday that they negotiated a confidential financial settlement with Greenberg Traurig in January. As part of the arrangement, they said, Greenberg Traurig will have the authority to pursue claims on the tribe's behalf against its former employee Jack Abramoff and public relations consultant Michael Scanlon.
Abramoff, formerly a prominent Republican lobbyist, and Scanlon secretly worked with conservative religious activist Ralph Reed to help persuade the state of Texas to shut down the Tigua casino in 2002, and then they persuaded the tribe to pay them to lobby Congress to reopen it, according to e-mails obtained by government investigators last fall.
Federal authorities are investigating possible fraud and public corruption in connection with Abramoff and Scanlon's dealings with the Tiguas and other tribes. The two collected at least $82 million in lobbying and public relations fees from half a dozen tribes. Abramoff also directed the tribes to donate more than $3.5 million to members of Congress, according to tribal records and Federal Election Commission documents.
Attorneys for Scanlon and Abramoff said they were surprised yesterday by the settlement. "If its terms are as described by the Tigua representative," said Scanlon's lawyer, Stephen L. Braga, "it's a most unusual posture for Greenberg Traurig to put itself in, and we would have to see how it plays out in court."
"Without seeing the settlement, Mr. Abramoff can have no comment," said a spokesman for Abramoff's lawyer, Abbe D. Lowell. "But it would be an odd legal arrangement for the firm to be able to sue one of its former employees on behalf of a tribe it did not represent and does not stand in the shoes of."
Scanlon, Abramoff and Greenberg Traurig are defendants in a $32 million suit alleging fraud and negligence filed by the Louisiana Coushattas tribe. Joe Kendall, attorney for the Coushattas, yesterday called Greenberg Traurig's position in the Tigua settlement "the mother of all conflicts of interest."
By becoming lawyers for the Tigua, Greenberg Traurig could limit any inquiry by the tribe into whether the firm had knowledge or involvement in Abramoff's activities with the Tiguas.
Jill Perry, a spokeswoman for Greenberg Traurig, confirmed the existence of the settlement and that the tribe had given Greenberg the right to pursue claims against Abramoff, its former partner. Perry said she had no comment about assertions that the terms of the deal represented a conflict of interest for the firm.
Greenberg Traurig pressured Abramoff to resign from the firm last year when his fees and financial arrangements were disclosed in a Washington Post report. The firm said at the time it was unaware of certain personal financial transactions by Abramoff, but it has declined to provide details of what Abramoff told his partners about his dealings with Scanlon and the tribes.
According to tribal officials, documents obtained by The Washington Post and testimony before the Senate Indian Affairs Committee, Abramoff signed on as a lobbyist for wealthy gaming tribes, then would advise the Indians to hire Scanlon's public relations firm for millions of dollars. Scanlon would then share some of those fees with Abramoff without the tribe's knowledge, according to documents the Senate uncovered.
In the case of the Tigua tribe, e-mails from Abramoff's computer turned over to Senate investigators showed Scanlon's firm was paid $4.2 million by the Tiguas, and that he then wrote a check for $2.1 million to Kay Gold LLC, a company formed by Abramoff. Abramoff told the tribe in an e-mail that Greenberg Traurig would work on getting legislation passed "on a pro bono basis" but then expected to be retained as lobbyists for between "$125,000 and $175,000 per month." Greenberg Traurig never registered as a lobbyist for the tribe.
Greenberg Traurig has said it is cooperating in the federal and congressional probes. It has been conducting an internal investigation of Abramoff's dealings for the past year and has hired Williams & Connolly, the law firm that negotiated the Tiguas settlement.
Posted by Gary Ruskin at 11:48 AM | Comments (2)
February 11, 2005
The FTC Caves in to Advertisers & Broadcasters on Product Placement
Yesterday, the Federal Trade Commission rejected Commercial Alert’s request for disclosure of product placement on television.
The FTC agreed with us that “there may be instances in which the line between advertising and programming may be blurred.” Even so, they dismissed the idea that product placement causes "consumer injury," even though, for example, product placement of junk food is commonplace on TV, and that American children are suffering from an epidemic of obesity and type 2 diabetes.
Essentially, the FTC has taken the position that companies may broadcast undisclosed commercial propaganda on airwaves that we the people own, and that are supposed to be operated for our benefit.
This is an outrage. We deserve an FTC that will stop the dishonest practices of the advertising industry, and stand up for the health of our children.
You can help by telling your Members of Congress to support the Parents' Bill of Rights, a set of nine legislative proposals to restore to parents some control over the commercial influences on their children's lives. Click here to send emails: http://actionstudio.org/?go=1201. The congressional switchboard phone is 202-225-3121.
One important part of the Parents' Bill of Rights is the Product Placement Disclosure Act, which would require clear and conspicuous disclosure of product placement on TV, movies, videos and video games. (For those of you who contacted your Members of Congress about the Parents' Bill of Rights, please do so again. A new Congress began this year, and that means we need you to send new emails and make new phone calls.)
You can also multiply our efforts by sharing this information with your friends, family, neighbors and colleagues.
The FTC wrote to us: "When the Commission considers whether an advertisement directed to children is deceptive, it examines the ad from the standpoint of an ordinary child. If objective claims about a product's attributes were made through product placement in programming directed to children, the Commission would consider whether the claims made would deceive an ordinary child. If no objective claims are made for the product, then there is no claim as to which greater credence could be given; therefore, even from an ordinary child's perspective, consumer injury from an undisclosed product placement seems unlikely."
The FTC's reasoning is based on the antiquated notion that advertising persuades only through objective claims, not images. That argument may have been somewhat true seventy years ago, but is certainly wrong today. Advertisers use product placement precisely because children (and adults) generally do put "greater credence" on product placements for Coca-Cola on American Idol than they do for regular 30-second ads for Coca-Cola.
As you might expect, a recent study in the British medical journal Lancet confirmed that product placement and product viewing are powerful negative influences on teens. It found that "viewing smoking in movies strongly predicts whether or not adolescents initiate smoking, and the effect increases significantly with greater exposure. Adolescents who viewed the most smoking in movies were almost three times more likely to initiate smoking than those with the least amount of exposure."
The Institute of Medicine understood the harmful effects of product placement on children when it recommended last year that "the Secretary of the Department of Health and Human Services should convene a national conference to develop guidelines for the advertising and marketing of foods, beverages and sedentary entertainment directed at children and youth with attention to product placement, promotion, and content."
Here are links to articles in the Washington Post, New York Times and Advertising Age about yesterday's FTC decision.
http://www.washingtonpost.com/wp-dyn/articles/A15671-2005Feb10.html
http://www.nytimes.com/2005/02/11/business/media/11adde.html
http://www.adage.com/news.cms?newsId=44303
Posted by Gary Ruskin at 12:11 AM | Comments (8)
February 06, 2005
Marketing Credit Cards to High School Students?!?
National Public Radio did an unusually good piece today on how the credit card industry preys on teens as young as fifteen years old.
From NPR News, this is ALL THINGS CONSIDERED. I'm Jennifer Ludden.
Your teen-agers may have finished sending out their college applications by now, but it's likely other applications for them are flooding your mailbox.
Unidentified Teen #1: I'm 17. I'll be turning 18 actually next Tuesday. You know, they'll send you the piece of mail, and there'll be sort of like a credit card type of thing, and it'll say your name on it. Then you'll open it up, and then it'll say, you know, `You've been pre-approved for a credit card. All you have to do is call this number, and we'll send you your card.'
Unidentified Teen #2: I'm 17 years old. Usually I get, like, a white envelope in the mail, and it's usually, like, a pre-approved statement--`look inside' type of thing--say, like, `If you want it, call this number now. You can have this credit card.'
Unidentified Teen #3: I'm in ninth grade. I'm 15. I've gotten these credit card offers. They've all come through the mail with a cool transparent window in the envelope that I like. And it says, `Apply now and you'll get, you know, no fees until' something or another.
LUDDEN: Those are the voices of students at Beaver Country Day School in Chestnut Hill, Massachusetts.
Such offers aren't new. You may remember getting them yourself. But industry analysts say credit card companies and banks are sending them to ever-younger potential customers.
Professor ELIZABETH WARREN (Harvard University): Because they're the last people left who don't already have nine credit cards in their wallets.
LUDDEN: Elizabeth Warren is the Leo Gottlieb professor of law at Harvard University and an expert on contract and bankruptcy law.
Prof. WARREN: Credit cards are incredibly profitable, and so they're looking high and low for anyone who might use a credit card. And most of the people who might use credit cards are already using someone else's credit card. So it's really hard to find new customers.
LUDDEN: Unless those customers are really young. It is not illegal to issue a credit card to a minor, but no bank spokesman we contacted said this is done on purpose.
Ms. NESSA FEDDIS (Senior Federal Counsel, American Bankers Association): I'm not aware of any card issuer who will issue a card to a minor or of any card issuer who is deliberately soliciting minors.
LUDDEN: Nessa Feddis is a senior federal counsel for the American Bankers Association, whose members include many credit card companies.
Ms. FEDDIS: Now it's possible that inadvertently solicitations may get into the hands of minors, but a solicitation is not the same as receiving a card, any more than an application to apply for Harvard means you're going to get into Harvard.
LUDDEN: Feddis says an application sent in by a minor would be checked and rejected. But the credit card industry itself touts minors as a new market. A four-year-old document by Experian, one of the Big Three credit reporting agencies, says this: Quote, "Young adults under 18 years of age are emerging credit customers, particularly those about to graduate from high school and enter the college ranks." Robert Manning is with the Rochester Institute of Technology and the author of "Credit Card Nation."
Mr. ROBERT MANNING (Rochester Institute of Technology; Author, "Credit Card Nation"): What's very clear in our recent statistics is that since about 2000, we've seen a sharp increase in use of credit cards among high school students. And by that, we're referring to people that are in the under-18-years-old category. In our recent study, we've seen that increase about threefold.
LUDDEN: Manning says some of that increase, no doubt, includes credit cards co-signed by teen-agers' parents but not all of it. On its face, it seems to make no sense to issue credit cards to minors without their parents' signature. By law, they're not obligated to repay whatever debt they incur before age 18. But Harvard's Elizabeth Warren says that may not matter.
Prof. WARREN: I mean, look at it from the parents' point of view. If you got a letter that said your child has run up $600 in charges and another couple of hundred dollars in interest rates and fees, and the credit card company can't sue the child, but they can ruin the child's credit rating, a lot of parents are going to dig deep in their pockets and pay it off. And that's what credit card companies count on. It's not the law that makes people do this. It's the heart.
LUDDEN: Nessa Feddis of the American Bankers Association disputes any such notion.
Ms. FEDDIS: Suggesting that the risk associated with giving unsecured credit, like a credit card, to someone who, by law, is not required to pay--that that risk is somehow outweighed by a very questionable assumption that the parent will step in for the child is more than speculative. It's untrue.
LUDDEN: But researcher Robert Manning says there is a track record of credit card companies looking to the parents of cardholders for repayment.
Mr. MANNING: There's a long litany of lawsuits that both the credit card industry has filed against parents and parents have followed in response to debt-collection efforts that they felt they weren't responsible for their children's high levels of credit card debt. So there's very clear evidence that the banking industry recognizes that while they're loaning an--unsecured funds to a young person, that the reality is that they look at the household's ability to bail that person out.
LUDDEN: Manning says there have been suits filed even when parents did co-sign their child's credit card. He cites one case in which the parents told the card company they'd only be responsible for up to $2,000 in purchases, but the bank allowed the child to run up a $10,000 debt, then sued for payment. That case is pending. All this has focused attention on the increasing debt being accumulated by young people. Manning, author of "Credit Card Nation," says when he began researching consumer credit in the early '90s, a common issue was the debt accumulated by graduating college seniors.
Mr. MANNING: In fact, what we're seeing today now is this new phenomenon of incoming college freshmen who already have anywhere from $3,000 to $12,000 in credit card debt and already are one step away from a financial crisis that will force them to drop out of school maybe their freshman or sophomore year.
LUDDEN: And once in college, the age-18-and-over crowd is a well-established target of the credit card industry. Julie Weber is executive director of housing and dining services at American University in Washington, DC.
Ms. JULIE WEBER (Executive Director, Housing and Dining Services, American University, Washington, DC): Someplace along the way credit card companies got a great idea that in order to have college students fill out credit card applications, they would work with a student group--you know, the car club--and they would work out an arrangement with the club. For every credit card application that is filled out, they'd give the club a donation: 25 cents, 50 cents. And for student organizations, who have a difficult time raising money, there's no risk to them. All they do is reserve a table, and the credit card company comes out and solicits the students walking by: `Would you like to fill out a credit card application? No risk. Just fill it out, and we'll give you a water bottle or a T-shirt or a stuffed animal.' And students would fill them out.
LUDDEN: As more young people get credit cards, both critics and industry officials say there's a greater need to teach financial literacy. Kathleen Rizzo Young is with HSBC bank. The company recently launched a campaign on credit awareness, and Young says dozens of HSBC employees go into middle and high school classrooms every year to talk about financial responsibility.
Ms. KATHLEEN RIZZO YOUNG (HSBC Bank): We spend millions of dollars educating young people as to the proper use of credit. We have a Web site called YourCreditCounts that educates people of all ages about using credit wisely, the importance of credit scoring. So this is something that we're very, very committed to as a company.
LUDDEN: Gary Ruskin heads Commercial Alert, a non-profit group concerned about marketing to children and their right to privacy. He suggests young people can try to avoid being solicited for credit cards in the first place by declining to give out personal information.
Mr. GARY RUSKIN (Commercial Alert): For example, don't fill out contest forms, don't put your personal information on Web sites, don't fill out warranty cards unless you're sure that your personal information's not going to be transferred. Don't do point-of-purchase plans. That will definitely help.
LUDDEN: So forego that three-year warranty on the new digital camera you just bought.
Mr. RUSKIN: (Laughs) Unless you're sure that the company isn't going to sell your personal information to everybody who wants to buy it.
LUDDEN: Ruskin would like to ban the sale of personal information of minors. Such a bill stalled in the last Congress but is likely to be introduced again this year. The notion of marketing credit cards to young people seems to turn common sense on its head. It used to be that banks preferred giving credit cards to someone with a steady income who'd already proven they could pay back a loan. Now Nessa Feddis of the American Bankers Association speaks of a democratization of the credit card industry.
Ms. FEDDIS: You need credit cards more than you did years ago. They're used to--you know, if you wanted to rent a car. Credit cards offer enormous convenience, but they're also a very secure way to manage your finances. If you lose your credit card, you haven't lost all your money.
LUDDEN: And teens aren't the only ones who see such benefits. One credit reporting agency cites a study of parents; two-thirds of them thought young people should have a credit card by the time they're 18. Again, Harvard law Professor Elizabeth Warren.
Prof. WARREN: It's a remarkable notion and terrific marketing, I should say, from the credit card companies that we have come to see the credit card as essential, you know, right up there with inoculations and getting yourself educated.
LUDDEN: Warren worries about the effect of this and, in fact, so do some of the kids.
Unidentified Teen #4: I see no purpose in having a credit card with no limit. I mean, personally, when I get older and I have kids, I'm not going to give my 17-year-old son a credit card with no limit. I mean, he's going to go nuts.
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LUDDEN: This piece was produced by Kim Kokich, with additional reporting by Andrea Shea in Boston.
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Posted by Gary Ruskin at 10:29 PM | Comments (8)
February 02, 2005
Arizona Finds No Loss of School Funds in Switch from Junk Food to Healthier Fare
Yesterday, the Arizona Department of Education released a study finding that schools don't lose money by switching the products in vending machines from junk food to something healthier.
Here's an article in today's Arizona Republic about the report:
http://www.azcentral.com/families/education/articles/0202junkfood02.html
Horne: Schools won't miss junk food; Sales study builds support for ban bill
by Anne Ryman
Schools that made healthy changes to their snack bars and vending machines during a five-month state study saw "no negative financial impacts." The fear of losing money has been the main reason that school districts have resisted banning junk food and soft drinks.
State Superintendent of Public Instruction Tom Horne released the results of an eight-school study on Tuesday that tested a ban on soft drinks and junk food during the school day and threw his weight behind a bill that would halt the sale of junk food in public schools.
"If you sell it, they will buy it," Horne said. "If you sell unhealthy things, they will buy that. But if you sell healthy foods, then they will buy that."
Schools and districts make tens of thousands of dollars annually through contracts with soft-drink companies and candy sales. The money pays for field trips, school clubs and athletic events.
Horne's study comes as schools across the United States are under pressure to provide healthier snacks because of rising rates of childhood obesity.
School districts in Seattle, Los Angeles and New York City have banned soft-drink sales along with sales of other junk food over concerns about childhood obesity.
Horne hopes the study will pave the way for the passage of House Bill 2544, a measure introduced last week by Rep. Mark Anderson, R-Mesa, that would require schools to ban soft drinks and offer healthier food at snack bars and in vending machines during the school day.
The legislation would prohibit schools from renewing or making new contracts with vendors for foods of "minimal nutritional value" which include soft drinks, candy, chewing gum and licorice. Vending-machine companies oppose the bill, saying schools should make that decision.
Critics in both the vending and soft-drink industry find fault with the school nutrition study, saying it was too short to measure effects on student health.
Stephanie Rimmer, a lobbyist for the food and beverage industry, calls the study's findings "preliminary" and not a good basis for legislation.
Rimmer said some schools in the study may have seen a jump in revenue simply because they increased their snack offerings for students.
Horne said the study was an "apples to apples" comparison. Nine more schools will take part in another similar study, which will begin in the fall.
A principal whose school took part in the study called it a positive experience.
Monte Vista Elementary School in east Phoenix averaged about $500 to $1,000 a month in snack-bar sales before the study. The 900-student school substituted granola and peanuts for candy bars and offered water instead of sugary sports drinks.
Principal Kathi Frankel said the school made $500 more in snack sales over the course of the study. She, like other school officials whose schools participated in the study, plan to continue offering healthy snacks.
Not all schools saw increases.
Stanfield Elementary School,which is west of Casa Grande, saw a dip in sales as did Catalina Magnet High School in Tucson. State Department of Education officials said that was because both schools had fewer vending machines available to students during the study. Stanfield shut vending machines off during mealtimes.
One school that took part in the study, Mountain Trail Middle School, saw its vending-machine sales bring in about the same amount, $230 a month, as last year.
Snack-bar sales from August through December were $12,576, which is about $4,500 behind last year, said Principal Jim Lee. The state excluded the school's snack-bar sales in its final report because state officials said external factors impacted sales. The snack bar was closed for a few days in October and November due to vandalism. This was the only snack bar excluded from the report.
Lee said he supports the change to healthier offerings.
"If it accomplishes the goal of healthier kids, I'm all for it," he said.
Lee does believe some of the revenue dip is due to the different snack choices, but he believes revenues will return in the long run.
Mountain Trail, near Cave Creek and Deer Valley roads in Phoenix, stopped serving anything with sugar or lard as a first ingredient during the school day to its 900 students. Instead of lollipops and candy bars, the snack bar offers crackers, sunflower seeds and Corn Nuts.
While this sounds strict, the campus is not all granola and raisins. The guidelines are loose enough to allow Famous Amos chocolate chip cookies, Rice Krispies Treats and Mini Oreo cookies.
And candy and soft drinks haven't been banned. Students can still buy them after school in the snack bar, which is run by the parent-teacher group.
Mom Carrie Salevitz, who volunteers at the snack bar, has seen a big change in the kids' behavior this year.
Last year, "these kids were wild, and after they were out here 10 minutes, you would not believe the noise level," she said.
This year, students are more courteous and patient, she said. And her eighth-grade son, who last year could make a meal from the snack-bar offerings, now eats in the cafeteria, she said.
Snack bars like the one at Mountain Trail are common at Arizona middle and high schools.
As long as the food is served outside the cafeteria, it doesn't have to meet the federal requirements for fat and calories that school lunches must follow. The snack sales have continued despite a 2001 U.S. Department of Agriculture report that warned that snack foods compete with lunch and may contribute to the trend of unhealthy eating among kids.
Students have mixed opinions about changing school snack bars.
Eighth-grader A.J. Burkett, 14, who attends Mountain Trail, sometimes misses candy and thinks schools should be able to sell sugary sports drinks during lunch.
Carolina Gonzalez,14, isn't concerned. Candy is still available in the snack bar after school, she said.
She went from eating candy bars and Skittles during lunch to munching on Corn Nuts and drinking bottled water.
"People started getting used to this," she said.
Posted by Gary Ruskin at 02:38 PM | Comments (2)
