Months of angst on the part of food and beverage marketers as well as consumer watchdog groups ended on Wednesday with promises by 11 major companies to curb their advertising of junk food to pre-teens. But the proof of this particular pudding will be in the eating, observers say. While words of praise sprang forth from watchdog and activist groups for the progress being made by food companies to join the fight against childhood obesity, they were tempered by words of caution and a wait-and-see attitude. The self-imposed rules include pledges by seven companies that will no longer use licensed characters to advertise online or in print media unless they're promoting their healthier products. Four other companies said they do not advertise at all to children under 12. The 11 companies, all participants in the Council of Better Business Bureau's Children's Food and Beverage Advertising Initiative, are: Cadbury Adams, Campbell Soup, Coca-Cola, General Mills, Hershey, Kellogg, Kraft, Mars, McDonald's, PepsiCo and Unilever. It is estimated that these companies accounted for more than two-thirds of children's food and beverage television advertising expenditures in 2004. Margo G. Wootan, director of nutrition for the Center for Science in the Public Interest, lavishly praised industry leaders Kraft and Kellogg, both of whom already have adopted policies to curb their advertising to children. While she called the commitments "a positive and historic development," Wootan noted that while the companies have agreed to no longer use licensed characters in ads, "many will still use these kid-friendly characters on packaging, and that's a problem." She urged Hershey, Mars and Coke to join Kraft and General Mills in agreeing not to market unhealthful food to children in middle and high schools. "Coke and Pepsi, in particular, could signal their commitment to kids' health by agreeing to support the school foods bill" sponsored by Sens. Tom Harkin (D-Iowa) and Lisa Murkowski (R-Alaska), Wootan said. The absence of Burger King, ConAgra, Nestle and Chuck E. Cheese's "points to the need for much stricter scrutiny of junk food marketing aimed at kids on the part of the Federal Trade Commission and Congress," she added. Marion Nestle, a noted professor of nutrition at New York University, wished she could be more optimistic about "what seems like amazingly generous concessions by food companies." While empathizing with what she called the companies' "impossible dilemma: even if they want to do the right thing, they can't if it means losing sales," Nestle cautioned that the companies have made similar promises in the past that were not kept. "Maybe--just maybe--the companies will behave better because so many are joined in the effort," she said. "But who will hold them accountable? I say, let's give them six months and see if they do what they say." "The big unanswered question is how stringent each company's nutritional guidelines are," said U.S. Rep. Ed Markey, (D-Mass.). "My hope is that they meet or exceed those developed by Kellogg and that they eventually develop unified nutritional guidelines. "Most importantly, I would like media industries to set their own voluntary commitments. Disney should be commended for being a leader in the TV industry along with Sesame Workshop ... but we haven't heard anything from Nickelodeon or Cartoon Network. As the chair of the [House] telecommunications subcommittee, I will continue to press them." The Campaign for a Commercial-Free Childhood called the pledges "great PR for food companies," but said that "taken has a whole, they are unworkable and unenforceable and are yet another indication that self-regulation has failed. "We need a uniform set of enforceable standards that prohibit marketing unhealthy food to children. It is clearer than ever that the food industry is unwilling or unable of adopting such standards. It's the role of government, not corporations bound by law to maximize profits, to safeguard public health." Tony DiResta, a partner in the regulatory litigation group of Reed Smith who has served as the regional director of the FTC's Southeast Office, said that in order for the FTC to act, advertising must be deceptive or unfair. "Today's presentations appear to applaud the efforts of self regulation. And they don't provide any basis for the FTC to act unless the companies break their promises to consumers."
Sales of hybrid cars are booming, but a new version of J.D. Power & Associates' study on hybrid powertrain vehicles suggests that automakers with successful hybrid programs might want to resist resting on their laurels just yet. The consultancy's "Alternative Powertrain Study" is a two-piece research study--both a standard survey on consumer opinion plus a portion called the Automotive Environmental Index. The latter piece takes U.S. EPA information on fuel economy, pollution and greenhouse gases for 2007 model-year cars and trucks and combines it with JD Power's survey data on how important those factors are to consumers. Per J.D Power, 50% of new-vehicle shoppers are considering a hybrid--down from 57% last year--across all age groups. Younger vehicle shoppers--those 16 to 25 years old--are less interested in hybrids, with 60% considering a hybrid in 2007, down from 73% in 2006. Hybrid buyers are willing to pay an average additional price of $2,396 for a car, and for that premium they expect to get 18.5 more mpg than a traditional vehicle of similar size. The 2007 Alternative Powertrain Study includes responses from more than 4,000 consumers in May and June 2007 who plan to purchase a new vehicle within the next two years. Mike Marshall, director of automotive emerging technologies at the consultancy, says that the reason for the declines is a perception that hybrids aren't as efficient as consumers had hoped they would be, and that the market for alternative powertrains is expanding to include other technologies. "In the 2006 study, we found consumers often overestimated the fuel efficiency of hybrid-electric vehicles, and the decrease in consideration of hybrids in 2007 may be a result of their more realistic understanding of the actual fuel economy capabilities," he said in a release. He says hybrids "continue to face competition for market share against an increasing offering of other alternative powertrains and fuels options." For example, per the study, desire for vehicles powered by clean diesel is at 23% versus 12% last year. On average, shoppers of this powertrain, per JD Power, are willing to pay an extra $1,491 for clean diesel for which they expect an average additional fuel economy of 15 mpg. The Automotive Environmental Index puts Toyota, which improved six positions in rank since last year, as the No. 1 brand for parameters like fuel economy and emissions reduction for both hybrid and gasoline cars. Second and third are VW and Honda. The consultancy says Honda has four models in the top 30. Ford and Nissan are fourth and fifth.
Amazon.com, which launched its endless.com shoe and handbag site back in January, is stepping up its advertising. Ads--themed "Shoes, glorious shoes"--"are running on large consumer and media sites, as well as smaller blogs and more targeted sites," says Larry Rowen, co-founder of Fly Communications, which created the campaign. The interactive campaign, which includes rich media banners, traditional banners and blog ads, grew out of research on the depth of shoe shoppers' obsessions. "As we went further and further into people's passion about shoes, and how these purchases are of primary importance to them, we realized you just couldn't go too far," he says. The 30-second video, for example, features a woman changing her shoes multiple times on her way to work, switching from galoshes to flip-flops to trail-runners to sexy little black pumps. These days, online shoe shoppers have more options than ever, with some experts estimating the total online shoe universe at about $3 billion. Market leader Zappos.com last week acquired the assets of 6pm.com from Denver-based eBags, Inc. And Gap Inc., struggling with all its bricks-and-mortar retail brands, launched piperlime.com, its shoe site, last year. Mainline retailers, of course, also sell plenty of shoes online: J.C. Penney is reportedly the second-largest online shoe seller. All of these sites are fighting for business on two fronts. They either have to lure devoted online shoe shoppers away from other sites with promises of better selection, prices and service, making free shipping and returns the norm. Or they have to convince people that buying shoes--a product that is notoriously hard to fit--can be a worthwhile online pursuit. Endless.com--the first company launched by Amazon without the Amazon name--has carved a niche for itself with its promise of "negative $5 shipping." "That's right," the site promises. "We pay you for overnight shipping." "Our job with this campaign is just to make sure that as many people see the site as possible," says Rowan. The site will do the rest--anyone who sees and uses the endless[.com] site will be back for more." Meanwhile, at Zappos, maintaining its leadership edge is "kind of a boring story," says Tony Hsieh, CEO of Zappos, who predicts that his company will reach $800 million in sales this year. "We are just constantly working on improving the customer experience."
Media, Penn.-based Synova Healthcare Group, Inc. is rolling out a new campaign for the Today Sponge. "A big part of what we've been trying to do since we purchased the company in January, which included the Today Sponge, is to take what is a great product and re-brand it," says Joann Armitage, Synova Healthcare executive vice president, sales and marketing. "The branding that we inherited is pretty close to what was done in the '80s when the product first came out." The new branding, including a new logo, debuted on the landing page of the todaysponge.com and in print ads running in the July and August issues of Cosmopolitan and Shape magazines, she said. The ad will run in Parents in August, Fitness in September and Working Mother in October. The new look features bright colors and stylish cartoon women discussing the Today Sponge, with the copy "Enjoy Spontaneity, Confidence and Control." The old Web site--which is what the landing page leads to--is still accessible but is being updated, and the new site will be online by the fourth week in July. It will be less text-heavy and easier to navigate, Armitage says. Horsham, Pa.-based pharmaceutical ad agency Dudnyk is handling creative duties while Dorland Global in Philadelphia is the AOR for PR. A consumer-directed contest, handled by Dorland, will be added to the mix in the fall, Armitage adds. TV and radio are possibilities in 2008. The marketing plan is unique because it targets such a wide-ranging age group--women from ages 21 to 44, she says. At some point in future marketing, there could be a reference to TV sitcom Seinfeld character Elaine Benes' hoarding of the product. "You just never know," Armitage coyly tells Marketing Daily. In the iconic episode, No. 113--entitled "The Sponge," which aired Dec. 7, 1995--Elaine wants to have sex with her new boyfriend, Billy, but reconsiders upon hearing that her cherished birth-control method, the Today Sponge, has been taken off the market. From the episode came the phrase "sponge-worthy." Armitage partly attributes the buzz surrounding that episode as the reason that research shows there is 90% aided awareness of what the Today Sponge is. However, only 20% realize that it's back on the shelves after a lengthy absence. The product was discontinued in 1995 because American Home Products, now Wyeth Pharmaceuticals, which made Today, discovered a contamination problem at the plant that made the sponges. Production was discontinued, although the sponge was a leading contraceptive. Allendale Pharmaceuticals bought the patent and factory and, after updating the factory to conform to new FDA regulations, the product quietly returned to the shelves in the U.S. late in 2005. In January 2007, Allendale was acquired by Synova Healthcare, Inc. Synova executives attended the American College of Obstetrics and Gynecology meeting in May, where the company "re-introduced" the Today Sponge to healthcare professionals nationwide. "Many ob/gyns were not even aware the product is again available," Armitage says. The Today Sponge is now widely available in the United States and Canada at major retailers such as CVS, Walgreens, Rite Aid, Target and Wal-Mart. Synova expects to add approximately 1,800 new points of distribution during the next two months, including Brooks Eckerd Pharmacy and Duane Reade.
A Greek yogurt that has been around for 81 years--seven in the U.S.--has placed its first ad ever in an eye-catching spot in this week's issue of New York Magazine. Pages 2 and 3 contain full-page ads. The one on the left features a Tourneau watch. On the right, the watch is seen to have sunk into something white and thick, leaving its impression. A small product shot in the lower right-hand corner shows it to be Fage (fah-yay) yogurt. Mark Tillinghast, senior vice president at Ogilvy, which designed the ad, says he's never worked on a food product "with such a remarkable point of difference." He is unapologetically enthusiastic about it, calling Fage yogurt "unbelievable" and "unlike any other yogurt" because of its texture, taste and thickness. The partnership with Tourneau, which he says was no trouble setting up, is the "ultimate product demo," and showcases the fact that the yogurt is very thick. Up until now, Fage has succeeded solely through word of mouth and buzz. And not without accolades. Last year, Ad Age named the company a top marketer for having produced $35 million in sales despite a lack of advertising. Fage, the second-largest food producer in Greece, decided to advertise because "they have a sense of awareness," says Tillinghast. "They know that if people try it, they love it. They try it, they buy it." A similar ad, paired with Honora pearls, is set to appear in New York Magazine as well as in Hamptons magazine.
The Absolut Spirits Company is creating a line of infused vodkas named after--and meant to evoke--certain American cities. The first of a limited-edition series will be Absolut New Orleans, central to a corporate goodwill effort in which all profits from the Absolut version will go to organizations benefiting New Orleans and cities along the Gulf Coast, per the company. Absolut New Orleans, infused with flavors like mango and black pepper, will go on sale nationwide on Aug. 1. The company says the flavored vodka will be sold at bars, nightclubs, restaurants, hotels and retail locations, including Ruth's Chris Steak House, and select Hilton and Doubletree properties. "Absolut New Orleans is the first in a series of limited-edition flavors that will evoke new 'tastes' while celebrating and supporting diverse cities," says Tim Murphy, vice president/marketing, in a release. Absolut will launch a national advertising and grassroots campaign that includes print and outdoor ads showing a line of relief trucks rolling into the Big Easy and displaced families moving back. Ads carry the theme line "In An Absolut World." The company will hold a launch event in New York City next month. Although the city-themed products are new, it follows a late 1980s ad campaign featuring creative evoking different cities. One said "Absolut Los Angeles," showing an Absolut-bottle shaped swimming pool. There was also an "Absolut New Orleans" advertisement, as well as one for San Francisco and Chicago. A spokesperson said the company is producing only 35,000 cases of "Absolut New Orleans," and expects it to sell out by November. "We expect it will be a collector's item, she says. The company is giving money from sales to groups like New Orleans Area Habitat for Humanity, Hands On Gulf Coast, Volunteer Mobile, Tipitina's Foundation and the Louisiana Restaurant Association Education Foundation. Through a partnership with the Tipitina's Foundation, the company will also fund a concert series for local talent in New Orleans.
Sears, Roebuck and Co. has tapped Richard Gerstein, the global chief marketing officer for Alberto-Culver, as its new chief marketing officer. Gerstein is expected to start early in August, the company says, reporting to Maureen McGuire, Sears Holdings' chief marketing officer. He replaces Joan Chow, who left the post in January. Observers say Gerstein will have his work cut out for him. Sears Holdings continues to be a relative darling of Wall Street, thanks to investor confidence in CEO Edward S. Lampert, the hedge-fund genius turned retailing guru. But the reality is that Sears continues to struggle, unable to woo back former customers or attract new ones. The company recently announced that, nine weeks into its second quarter, same-store sales at Sears stores in the U.S. had already fallen 4%, causing it to lower earnings estimates. Sears launched an extensive new marketing campaign back in May, and Gerstein will "help Sears reconnect with its loyal customers and attract former customers back to Sears," the company says. Gerstein has also held marketing positions at Procter & Gamble.
According to the Centers for Disease Control and Prevention, the estimated number of new AIDS diagnoses in the U.S. from 2000 through 2005 increased by 17% among women and 16% among men. The CDC further estimates 19 million new sexually transmitted infections per year nationally - and direct medical costs associated with STDs in the U.S. estimated at up to $14.1 billion annually. These figures and their impact are well understood by the people who are behind the Trojan condom brand, and their latest piggish advertising campaign and the accompanying trojanevolve.com site seek to explain Trojan's solution to this ongoing public health scenario. When pigs fly, said the ABC, CBS, and NBC affiliates in Pittsburgh - all of whom rejected the Trojan television spots, echoing an earlier rejection from CBS and Fox nationally. Ray Carter, general manager of WPXI, the NBC affiliate in Pittsburgh, told The New York Times that the spot was "not one we thought was appropriate for the market." Can media executives deem what messaging is or is not appropriate for an entire population in a given market? While media properties have the right to protect their audience from tasteless advertising creative or fictional claims in advertisements, Pittsburgh features a 33% composition of people aged 15-34, according to the 2000 census. Advertisements from condom manufacturers can have direct health benefits to this active demographic - and the Trojan campaign is no different, as it is ultimately about responsible intimacy planning. In a press release, Michael Weinstein, president of AIDS Healthcare Foundation, finds hypocrisy in the position of the television networks and affiliates. "On any given day or night, Viagra and other erectile dysfunction ads also run regularly on these networks," he stated. The trojanevolve.com site - which offers video testimonies from numerous public health authorities, along with the controversial spot itself - has attracted more than 400,000 unique users since June 18. "As a condom manufacturer, we view ourselves as a steward of public health," said Jim Daniels, VP of marketing on the Trojan brand, in a recent Marketing Daily interview. "In our research, only one in four sex acts involves condom use, which is a very low rate versus the rest of the Western world." With national condom usage at just 25% and sexually transmitted infections - including AIDS - on the rise in the U.S., it could be argued that denial of these messages from reaching the most vulnerable young audiences is irresponsible. While media properties certainly have the right to approve or disapprove certain creative messages, controlling the spread of communicable disease should supersede the individual moral platforms of TV network and affiliate management - many of whom are well beyond the Trojan target audience. The outright rejection by the management at Pittsburgh's television affiliates may be a matter for the FCC. These decisions on what is appropriate or inappropriate with regard to responsible sexual activity certainly transcend one television market.