Food Mkting SS '10 FINAL_mtd

Supporting Statement for a Paperwork Reduction Act
Submission to OMB
FTC Study of Food Marketing to Children and Adolescents
(OMB Control No. 3084-TBD)
The Federal Trade Commission (“FTC” or “Commission”) proposes to conduct an
analysis of food and beverage industry marketing to children and adolescents. This analysis will
examine advertising and promotional techniques and expenditures, and the nutritional content of
food products marketed to children and adolescents by members of the food industry. The
Commission will seek the information necessary to prepare this analysis through compulsory
process under Section 6(b) of the FTC Act, 15 U.S.C. § 46(b).
1. & 2.

Necessity for Information Collection and How the Data Will Be Used
Authority Under the FTC Act to Conduct the Proposed Study

Although the FTC is primarily a law enforcement agency, Congress also has endowed the
Commission with authority to investigate and report to Congress and the public on industry
practices that affect the economic well-being of consumers.1 For example, the Commission has
released reports on topics such as: competition issues surrounding broadband connectivity;
investigation of price manipulation and price increases in the wake of Hurricane Katrina; and
factors that affect gasoline prices in the United States.2 The proposed analysis is a follow-up to a
study, required by Congress and approved by OMB in July 2007 (OMB Control Number 30840139), that the Commission conducted of youth-directed food marketing activities and
expenditures during calendar year 2006.3

1

Specifically, Congress has authorized the FTC “to gather and compile information concerning,
and to investigate from time to time the organization, business, conduct, practices, and
management of any person, partnership, or corporation engaged in or whose business affects
commerce,” and “to make public from time to time such portions of the information obtained by
it hereunder as are in the public interest.” 15 U.S.C. §§ 46(a), (f).
2

FTC, Broadband Connectivity Competition Policy (June 2007), at
www.ftc.gov/reports/broadband/v070000report.pdf; FTC, Investigation of Gasoline Price
Manipulation and Post-Katrina Gas Price Increases (Spring 2006), at
www.ftc.gov/reports/060518PublicGasolinePricesInvestigationReportFinal.pdf; FTC, Gasoline
Price Changes: The Dynamic of Supply, Demand, and Competition (2005), at
www.ftc.gov/reports/gasprices05/050705gaspricesrpt.pdf.
3

It also is very similar in content and methodology to studies that the Commission has
undertaken with respect to advertising for alcoholic beverages and tobacco products. See, e.g.,
FTC’s Study on Alcohol Industry Self-Regulation (OMB Control Number 3084-0138); FTC
Cigarette and Smokeless Tobacco Data Collection (OMB Control Number 3084-0134).

Necessity for (and Practical Utility of) the Proposed Study
Childhood obesity is a critical public policy issue in the United States, one with serious
public health consequences. The U.S. Department of Health and Human Services (HHS) Office
of the Surgeon General recently reported that “nearly one in three children are overweight or
obese” in this country.4 In February 2010, President Obama established an advisory Task Force
on Childhood Obesity, comprised of officials from several federal agencies, to develop an
interagency action plan to solve the national childhood obesity problem within a generation.5
One of the specific objectives of the Task Force is to empower families with information to
make healthful choices. An area of focus for the interagency action plan is “identifying relevant
evidence gaps and conducting or facilitating needed research to fill those gaps.”6 A fundamental
aspect of the FTC’s consumer protection mission is to facilitate consumers’ access to accurate,
reliable information to assist in their decision making. The FTC’s proposed study will further
the goals of the Task Force and the FTC’s consumer protection efforts by analyzing and
reporting on youth-directed food marketing expenditure and nutrition data not otherwise
available in the public domain (see infra Section 4).
In recent years, the Commission has made significant contributions to this important
public health area through its examination of youth-directed food marketing practices. In July
2005, the FTC and HHS jointly convened a two-day workshop on “Marketing, Self-Regulation,
& Childhood Obesity” to focus attention on initiatives that the food industry and others could
undertake to encourage healthier eating and lifestyles among the nation’s youth. The workshop
produced a series of recommendations, including suggestions for industry self-regulatory
initiatives to address the way in which food is marketed to children.7
An outgrowth of the FTC-HHS workshop was the Council of Better Business Bureaus’
establishment of the Children’s Food and Beverage Advertising Initiative (CFBAI) in November
2006. To date, 16 of the largest food and beverage companies – estimated to represent more

4

U.S. Dept. Health and Human Services, The Surgeon General’s Vision for a Healthy and Fit
Nation (Jan. 2010) (Surgeon General 2010 Report), at
http://www.surgeongeneral.gov/library/obesityvision/obesityvision2010.pdf.

5

The White House, Presidential Memorandum – Establishing a Task Force on Childhood
Obesity (Feb. 9, 2010), at
http://www.whitehouse.gov/the-press-office/presidential-memorandum-establishing-a-task-force
-childhood-obesity.
6

Id. at Section 3(d).

7

Federal Trade Commission & Department of Health and Human Services, Perspectives on
Marketing, Self-Regulation, & Childhood Obesity (Apr. 2006). Recommendations that came out
of the workshop are listed at pages 48-54 of that report.
2

than eighty percent of children’s food and beverage ads on TV8 – have joined the CFBAI
Initiative.9 Also in 2006, the Alliance for a Healthier Generation began its program to improve
the nutritional profile of competitive food and beverages available in schools.10 The Alliance
recently reported “an 88 percent decrease in total beverage calories shipped to schools between”
school years 2004 and 2009.11
In July 2007, the FTC held a public forum to review industry self-regulatory initiatives
and relevant research on youth-directed food marketing.12 At that time, FTC officials voiced a
commitment to monitor industry progress in this area and, specifically, to conduct a
comprehensive study of youth-directed food marketing practices to establish a baseline by which
to measure the success of industry initiatives.13 Later that month, the Commission issued
compulsory process orders to 44 food, beverage, and quick service restaurant companies to
collect information on their marketing activities and expenditures directed to children and

8

Association of National Advertisers Press Release, Children’s Food and Beverage Advertising
Initiative Promotes Nutritious Choices and Healthier Lifestyles to Kids (Jan. 19, 2009), at
http://www.ana.net/advocacy/content/1613.

9

Individual company pledges vary, but all participants have agreed, among other things, to limit
television and certain other advertising to foods meeting certain nutritional criteria, to refrain
from advertising their products in elementary schools, and to reduce the use of third-party
licensed characters in child-directed advertising. CFBAI Website, at
http://www.bbb.org/us/about-children-food-beverage-advertising-initiative/.
10

See Alliance Press Release webpage, at http://www.healthiergeneration.org/media.aspx.

11

See Alliance website, at http://www.healthiergeneration.org/companies.aspx?id=4400.

12

FTC Press Release, Weighing-In: A Check-up on Marketing, Self-Regulation, and Childhood
Obesity (July 2007), at http://www.ftc.gov/opa/2007/06/weighingin.shtm.
13

See, e.g., Remarks of Lydia Parnes, then-Director of FTC’s Bureau of Consumer Protection,
at the FTC’s 2007 Food Marketing Forum (July 18, 2007), at
http://www.ftc.gov/speeches/parnes/070718obesity.pdf.
3

adolescents.14 The study, conducted at the request of Congress,15 examined a spectrum of youthdirected food marketing activities and corresponding expenditures during calendar year 2006.
In July 2008, the FTC issued a report to Congress entitled Marketing Food to Children
and Adolescents: A Review of Industry Expenditures, Activities, and Self-Regulation (2008
Report).16 It found that the reporting companies spent more than $1.6 billion marketing their
products to children and adolescents in 2006, and employed a variety of techniques, including
promotion through traditional measured media (television, print, radio), the Internet and other
“new” media, product packaging, and in-store advertising, as well as integrated campaigns that
combined several techniques and cross-promotions with media and entertainment companies.17
The 2008 Report included several recommendations, among them that companies marketing
food or beverage products: (1) adopt meaningful uniform nutrition-based standards for all
products marketed to children under age 12; and (2) apply these standards to all advertising and
promotional techniques.18 The Commission indicated it would issue a follow-up report assessing
the extent to which the 2008 Report recommendations have been implemented and what, if any,
additional measures may be warranted.
In December 2009, the FTC hosted a forum entitled “Sizing Up Food Marketing and
Childhood Obesity” to discuss relevant scholarly research, self-regulatory initiatives, and policy
and legal issues. At that event, the Chairman of the FTC noted that preparations were underway

14

Also in 2007, the FTC’s Bureau of Economics released a report on children’s exposure to
television advertising, comparing data from 2004 to similar data from 1977. The study
concluded that children are not exposed to more food ads on television than they were in the
past, although their ad exposure today is more concentrated on children’s programming. Federal
Trade Commission, Bureau of Economics Staff Report, Children’s Exposure to Television
Advertising in 1977 and 2004: Information for the Obesity Debate (2007), at
http://www.ftc.gov/os/2007/06/cabecolor.pdf.
15

The study was requested by Congress in conjunction with the Commission’s FY 2006
appropriation (Pub. L. No. 109-108). The Conference Report (H.R. Rep. No. 109-272 (2005))
for this appropriations law incorporated by reference language from the Senate Report (S. Rep.
No. 109-88 (2005)) instructing the FTC to prepare a report on food industry marketing activities
and expenditures targeted to children and adolescents.
16

Available at http://www.ftc.gov/os/2008/07/P064504foodmktingreport.pdf.

17

Id. at 7-8.

18

These advertising and promotional techniques include television, print, and radio; website,
Internet, and digital advertising; word-of-mouth and viral advertising; product packaging and
retail promotion; movie and video promotion; use of premiums in connection with the sale of a
product; product placements, character licensing, and cross-promotion; athletic sponsorship;
celebrity endorsements; and in-school marketing.
4

for a Commission study of youth-directed marketing by the food industry in calendar year
2009.19
The proposed study will advance the Commission’s efforts to understand how food
industry promotional dollars targeted to children and adolescents are allocated, the types of
activities and marketing techniques the food industry uses to market its products to children and
adolescents, and the extent to which self-regulatory efforts are succeeding in improving the
nutritional quality of foods advertised to children and adolescents. The FTC proposes to gather
2009 data covering generally the same scope of food marketing activities and expenditures as
covered by the 2008 Report. In an additional area of focus, the Commission will gather key
nutrient data (e.g., calories, fat, sodium, sugar, servings of whole grains, servings of fruit and
vegetable) for foods and beverages that the respondents marketed to children and adolescents in
2009, and for foods and beverages previously reported by companies for calendar year 2006.
With this information, the Commission will be able to analyze changes in the nutritional profile
of foods marketed to youth since the implementation of industry self-regulatory initiatives and,
accordingly, the impact of self-regulatory standards such as those of the CFBAI. Furthering the
consumer education goals of the FTC and the Presidential Task Force on Childhood Obesity, the
information collection will create educational opportunities for children and teenagers and offer
parents and youth useful data to inform their consumer choices. In addition, it will provide
industry members and policy makers with the means to assess the impact of self-regulatory
initiatives and decide on important next steps.
How the Data Will Be Collected and Used
The FTC proposes to send information requests to forty-eight (48) food and beverage
manufacturers, distributors, and marketers and quick service restaurant companies in the United
States, forty (40) of which were recipients of the Commission’s 6(b) Orders in 2007. The FTC
has selected companies based on the likelihood that they market food products directly to
children and adolescents. The companies selected have not been randomly sampled to represent
the total population of companies that produce, distribute, and market food products in the U.S.
because that is not the relevant population for purposes of this study.
The FTC staff conducted extensive research in order to compile the list of proposed
recipients of the Section 6(b) orders. Staff first reviewed a number of public sources – including
an Institute of Medicine Report on food marketing to children, studies of food advertising to
children on TV and online, and press reports – regarding categories of foods most often
marketed to children and adolescents. Staff also conferred with the FTC economists who
recently studied children’s exposure to television food advertising to identify categories of foods

19

Remarks by FTC Chairman Jon Leibowitz at “Sizing Up Food Marketing and Childhood
Obesity” (Dec. 15, 2009), at
http://www.ftc.gov/speeches/leibowitz/091215foodmarketingobesity.pdf.
5

most frequently marketed to children and adolescents on TV.20 FTC staff then consulted a
variety of published sources, and purchased relevant TV advertising exposure data from Nielsen
Media Research, to determine the companies that likely account for the majority of the
marketing directed to children and adolescents for these categories of foods. For each company
identified, staff researched public sources and examined company and product websites to
determine the media techniques used by those companies to market food products to children
and adolescents. For most of the selected food categories, the target companies constitute the
top television advertisers in programs or time segments where 30% or more of the audience is
between the ages of 2 and 17. Moreover, for the primary products in these food categories, the
targeted companies account for 60% to 90% of U.S. sales.21
As a result of this research, FTC staff is confident that the companies that will receive
information requests are those marketing and selling the categories of food and beverage
products that are advertised to children and adolescents most frequently, including all 16
members of the CFBAI. The CFBAI reportedly accounts for at least three-fourths of children’s
food and beverage television advertising expenditures;22 therefore, the proposed FTC study will
account for significantly more than three-fourths of advertising expenditures directed toward
children and adolescents. In its report on this study, the Commission will accurately characterize
the data within the context of the population from which the data were derived and will draw
conclusions supported by the data.
Included among the 48 companies to which the FTC proposes sending the information
collection are several fruit and vegetable producers, distributors, and marketers. Traditionally,
fruit and vegetable companies have not engaged in significant marketing efforts but, in recent
years, some of these fruit and vegetable companies have packaged and promoted their products
in ways likely to appeal to children, such as by using licensed characters popular with children in
their product labels and displays.23 In addition, some quick service restaurants reportedly have
placed greater emphasis on featuring fruit in their children’s meal advertising.24 FTC staff has
identified particular companies engaged in such activities and has included them in the proposed
information collection. Gathering information on these practices will enable FTC staff to
compare the marketing techniques and expenditures being used to market fruits and vegetables

20

See supra note 14.

21

The exception is fruit and vegetable marketers, which are discussed below.

22

CFBAI website, at http://www.bbb.org/us/children-food-beverage-advertising-initiative/;
ANA Press Release, supra note 8.
23

See, e.g., Keiko Morris, “SpongeBob sells spinach and Dora the Explorer hawks carrots as
food producers and entertainment companies join forces,” Newsday (June 15, 2007).
24

See, e.g., Lauren Shepherd, “Burger King looks to woo mom with new kids meal,” The
Associated Press (June 30, 2008); Catherine R. Cobb, “Despite kids’ menu upgrades, critics still
slam QSR fit fare,” Nation’s Restaurant News (Sept. 1, 2008).
6

relative to foods that traditionally have been more frequently marketed to children and
adolescents.
FTC staff has carefully crafted its information requests so as to collect information that
may be used in a reasonable, practicable, workable, and reliable way. As with the 2006 study,
the information requests will seek data and information regarding, among other things: (1) the
types of foods marketed to children (ages 2-11 years) and adolescents (ages 12-17 years); (2) the
types of measured25 and unmeasured26 media techniques used to market food products to
children and adolescents; (3) the amount spent to communicate marketing messages about food
products to children and adolescents in measured and unmeasured media; (4) the nature of the
marketing activities used to market food products to children and adolescents; (5) marketing to
youth of a specific gender, race, ethnicity, or income level; and (6) marketing policies,
initiatives, or research in effect or undertaken by the companies relating to the marketing of food
and beverage products to children and adolescents. As noted above, the FTC also proposes to
gather nutrition information about products the companies marketed to children and adolescents
in calendar years 2006 and 2009, to evaluate possible changes in the nutritional content, and
variety, of youth-marketed foods. Further, the Commission proposes to seek scientific and
market research exploring psychological and other factors that may contribute to food
advertising appeal among youth.
In keeping with the 2006 study, the proposed Section 6(b) Orders will seek information
about the categories of food products, the specific brands and sub-brands that the companies
market to children and adolescents. The Orders will specify ten (10) food categories for which
companies will have to report marketing expenditures and activities.27 The proposed Section
6(b) Orders will also request information on whether the companies offer a line of food products
bearing a nutritional icon, seal, or symbol, or otherwise identified as “better for you” or healthier
than other products, and will seek information on how those product lines are marketed to
children and adolescents. This information will help the agency evaluate the variety of foods
and beverages that is marketed to children and adolescents.
25

“Measured media” include methods typically measured by market research companies such as
television, radio, print (magazine and newspaper), and some forms of Internet advertising.
26

“Unmeasured media” include methods for which audience size is not typically measured, such
as in-store marketing (including shelf placement), events, package promotions, digital
marketing, and product placement in entertainment media (including television shows, movies,
video games, and music recordings).
27

The specific categories are: breakfast cereals; snack foods; candy and frozen desserts; dairy
products; baked goods; prepared foods and meals; carbonated beverages; fruit juice and noncarbonated beverages; and restaurant foods. FTC staff has identified these as the categories of
food and beverage products that appear to be advertised to children and adolescents most
frequently. In addition, the FTC proposes to collect information from major marketers of fruits
and vegetables to ensure that data are gathered regarding efforts to promote consumption of
these foods among children and adolescents.
7

The proposed Section 6(b) Orders will require the companies to provide their marketing
activities and expenditures during the calendar year 2009 in 18 different measured and
unmeasured media categories.28 The proposed Section 6(b) Orders will require industry
members to report expenditures in each media category by food category, by brand, and, where
such advertising exists, by sub-brand, and to identify expenditures for foods that are part of a
product line bearing nutritional seals or icons. Expenditures will be reported separately for
marketing activities directed to children ages 2-11 and for those directed to adolescents ages 1217. This information will allow the agency to analyze how industry members allocate their
promotional expenditures among particular food and beverage products and particular media for
each age group. Total marketing expenditures for each food product, and within each
promotional activity category, will also be reported to permit the agency to analyze the
percentage of marketing expenditures for any product or in any media category that is directed to
children or adolescents.
The proposed Section 6(b) Orders also will require the 48 respondents to provide specific
nutritional data for each food product that the companies marketed to children or adolescents in
2009.29 Recipients of the Section 6(b) Orders who filed a Special Order for calendar year 2006
likewise must provide the requested nutrition data for each food product that the company
identified as marketed to children or adolescents in 2006.30
The nutrition data to be requested includes common nutrient information that typically
appears on the Nutrition Facts panel of packaged goods, such as serving size, total calories,
calories from fat, total fat, saturated fat, trans fat, cholesterol, sodium, potassium, total
carbohydrate, dietary fiber, sugars, protein, vitamin A, vitamin C, calcium, and iron. The
Commission also intends to seek certain other information, including added sugar, all grain
content and whole grains content, fruit and fruit juice content, vegetable and vegetable juice
content, dairy content, and information on certain protein-rich foods (e.g., fish, lean

28

These are: (1) television advertising; (2) radio advertising; (3) print advertising; (4) companysponsored Internet sites; (5) other Internet and digital advertising; (6) packaging and labeling;
(7) movie theater/video/video game advertising; (8) in-store advertising and promotions;
(9) specialty item or premium distribution; (10) public entertainment events; (11) product
placements; (12) character licensing, toy-co-branding, and cross-promotions; (13) sponsorship of
sports teams or individual athletes; (14) word-of-mouth and viral marketing; (15) celebrity
endorsements; (16) in-school marketing; (17) advertising in conjunction with philanthropic
endeavors; and (18) other expenditures.
29

If a company reformulated the food product in 2009, the company must provide nutritional
data for the last of the formulations in 2009.
30

For ease of reporting, the FTC will provide each company that submitted a Special Report for
calendar year 2006 with a pre-populated spreadsheet showing the products that the company
previously identified as marketed to youth.
8

meat/poultry, egg, nuts, and beans). This information will enable the Commission to effectively
analyze the nutritional profile of foods marketed to children and adolescents.
In sum, the proposed Section 6(b) Orders seek comprehensive information about
activities and expenditures to promote food and beverages to children and adolescents, as well as
the nutritional composition of such products. As explained above, this information will allow
the agency to analyze how industry members allocate their promotional activities and
expenditures among various media and for different food products. In addition, the FTC will be
able to evaluate the impact of self-regulatory efforts on the nutritional profiles of foods marketed
to children and adolescents. The food, promotional activity, and nutrient categories are carefully
defined to facilitate compliance with the requests, as are the criteria for determining whether
particular marketing activities, expenditures, and nutritional data must be included in the
responses.
The information ultimately presented in the FTC’s report will not reveal companyspecific data, except data that are public. See 15 U.S.C. § 57b-2(d)(1)(B). The Commission
anticipates providing information on an anonymous or aggregated basis, in a manner sufficient
to protect individual companies’ confidential information, to provide a factual summary of food
industry marketing activities and expenditures targeted to children and adolescents and changes
in nutritional content within specific food categories.
3.

Information Technology

Improved information technology may assist in gathering and producing this information.
Consistent with the aims of the Government Paperwork Elimination Act, 44 U.S.C. § 3504, the
FTC will request the submission of information through electronic means. Electronic
submissions of the expenditure and nutrition data are needed to enable FTC staff to aggregate
and analyze the data using database software. In addition, the FTC is requesting the submission
of one paper copy. This will facilitate the reading of the individual submissions by the FTC staff
and will ensure that analysis will not be delayed by potential problems in the printing and
copying of electronic submissions.
4.

Efforts to Identify Duplication

There is no reliable information available elsewhere that can be used to prepare this
follow-up to our 2008 Report. Efforts to identify duplicate sources of information included a
review of trade journals, government publications, and other published sources.31

31

In 2005, the Institute of Medicine, Committee on Food Marketing and the Diets of Children
and Youth, prepared a report titled “Food Marketing to Children and Youth: Threat or
Opportunity?” The Committee relied upon published sources and publicly available industry
and commercial marketing research. It noted in its report, however, at pp. 1-14, the difficulty of
obtaining and using the relevant data:
9

5.

Efforts to Minimize the Burden on Small Organizations

The requests to the 48 food and beverage industry members (including 41 producers,
distributors, and/or marketers and 7 restaurant companies) will not have a significant impact on a
substantial number of small entities. Wherever possible, the FTC has attempted to minimize the
time commitment necessary to respond to the information requests. The FTC will consider
proposals for use of information technology that may reduce the burden.
6.

Consequences to Federal Program and Policy Activities/Obstacles to Reducing
Burden

If the information is not collected, the FTC will not have the data necessary to evaluate
the extent of industry changes between 2006 and 2009, including critical areas of interest such as
nutrition content and advertising costs and activities. We expect this information to be helpful
to, and relied upon by, federal agencies and policymakers in their efforts to address childhood
obesity. The burden of the information collection has been reduced as much as possible.
7.

Circumstances Requiring Collection Inconsistent with Guidelines

The information requests are consistent with all the applicable guidelines contained in
5 U.S.C. § 1320.5(d)(2).
8.

Public Comments/Consultation Outside the Agency and Actions Taken

As required by 5 C.F.R. 1320.8(d), the Commission published a Federal Register notice
seeking public comment on the proposed collections of information, see 74 Fed. Reg. 48,072
(Sept. 21, 2009) (hereinafter “September 2009 Notice”), and is doing so again
contemporaneously with this submission.
In response to the September 2009 Notice, the FTC received public comments from the
following six entities:32 (1) the Robert Wood Johnson Foundation Center to Prevent Childhood

The Committee faced several notable challenges to acquiring and using this commercial
marketing research. Businesses are increasingly using integrated marketing strategies to
ensure that young consumers are exposed to messages that will stimulate demand, build
brand loyalty, and encourage potential or existing customers to purchase new products.
. . . Many of these strategies are new, and are not well researched or evaluated.
Additionally, a large proportion of this research is conducted for paying clients and is
therefore considered to be proprietary information that is not publicly accessible or
available only for purchase at considerable cost to the committee and with prohibitive
constraints on public availability of the data.
32

The comments are available at http://www.ftc.gov/os/comments/foodmktgkids-2/index.shtm.
10

Obesity (RWJF Center); (2) the Food Marketing to Children Workgroup (FMC Workgroup)33;
(3) the Council of Better Business Bureaus’ Children’s Food and Beverage Advertising Initiative
(CFBAI); (4) the Grocery Manufacturers Association (GMA); (5) the African American
Collaborative Obesity Research Network (AACORN); and (6) Children Now on behalf of
several organizations.34 The RWJF Center and the FMC Workgroup expressly favored the
proposed data collection and made suggestions for additional information to collect. The
remaining four comments did not oppose the data collection. All commenters included
suggestions for enhancing the quality, utility, and clarity of the information to be collected, and
one offered suggestions for reducing the burden on the companies.
a.

General Support for the Data Collection

Two commenters indicated that the proposed information collection is essential to
furthering knowledge of youth-directed food marketing. The RWJF Center stated the “follow-up
study will continue to add to and expand upon our knowledge of food and beverage products
marketed to, as well as marketing practices aimed at youth.”35 The FMC Workgroup added that
it “strongly supports the FTC’s proposed information collection as necessary and useful.”36 In
addition, the CFBAI lauded the FTC for its 2008 Report, “which through empirical data
collection and rigorous analysis, brought much needed clarity and certainty to the question of
food and beverage marketing to children.”37
b.

Utility of the Information Collection

In its September 2009 Notice, the FTC stated that it would seek relevant information,
including empirical data, on the nature and extent of marketing activities and expenditures
targeted to children and adolescents, and nutrition information about products that companies
marketed to children and adolescents in calendar years 2006 and 2009. The FTC invited
33

The FMC Workgroup, organized by the Center for Science in the Public Interest and Berkeley
Media Studies Group, is comprised “of more than 120 individuals from academics and local,
state, and national child advocacy and health organizations across the United States.” FMC
Workgroup comment at 1.
34

The signatories to the Children Now comment are The American Academy of Pediatrics; The
American Psychological Association; the African American Collaborative Obesity Research
Network; the Campaign for a Commercial-Free Childhood; Children Now; Common Sense
Media; Morality in the Media; the National Policy and Legal Analysis Network to Prevent
Childhood Obesity; the Parents Television Council; the Rudd Center on Food Policy and
Obesity, Yale University; Save the Children; and Ellen Wartella, Professor, University of
California, Riverside.
35

RWJF Center comment at 1.

36

FMC Workgroup comment at 1.

37

CFBAI comment at 1.
11

comments on whether the proposed collections of information are necessary for the proper
performance of the functions of the FTC.
Commenters also addressed the question of whether the information collected will have
practical utility. The RWJF Center commented that the FTC’s proposed information collection
is important to expanding knowledge of food and beverage marketing in light of changes that
have occurred in the marketing landscape in the past few years, such as novel new media and
market research techniques. The FMC Workgroup commented that collecting 2006 and 2009
data will allow the FTC to assess the extent to which companies have implemented the
Commission’s 2008 recommendations, and to identify additional actions that may be warranted.
The FMC Workgroup also agreed that collecting nutritional data will allow the Commission to
better evaluate the impact of self-regulatory pledges.38
c.

Suggestions for Improvements to the Proposed Information Collection

The FTC invited comments in its September 2009 Notice on ways to enhance the quality,
utility, and clarity of the information to be collected. The FTC received several suggestions for
enhancing the FTC’s proposed collection of marketing data by collecting the following: (1)
exposure data for measured media and new media (e.g., Internet, digital, and viral marketing);
(2) additional data for new media, including certain expenditure data and measures of ad
effectiveness; (3) additional market research data; (4) other marketing data based on race,
ethnicity, age, and other demographic indicators; and (5) data regarding nutrition information
and specific food categories.
Exposure data. Children Now, the RWJF Center, and the FMC Workgroup suggested
that gathering exposure data is important to accurately evaluate child and adolescent exposure to
measured media and various interactive media techniques. The RWJF Center and Children Now
suggested the FTC gather data on exposure and impressions, and the RWJF Center also
suggested gathering data on the demographic makeup of the audiences (e.g., distributions by age
group and among racial and ethnic minority populations).39 The FMC Workgroup requested that
exposure data be collected and disaggregated among different types of new media.40
The Congressional appropriations language upon which the 2008 Report was based
instructed the FTC to prepare a report on food industry marketing activities and expenditures
“targeted toward” children and adolescents. In other words, Congress asked the FTC to examine
food advertising intentionally marketed to youth. Because it was not feasible for the
Commission to make ad-by-ad, fact-intensive determinations of intent, the FTC relied on
objective criteria. For television, an ad was deemed to be child-targeted if the company’s
marketing plan so indicated or if the advertisement appeared during a program that had a 30%
38

FMC Workgroup comment at 2.

39

RWJF Center comment Attachment 1, Section A; Children Now comment at 1.

40

FMC Workgroup comment at 2.
12

child audience; a 20% threshold was used for adolescent-targeted ads. The percentage threshold
for child-targeted Internet advertising was 20% (as opposed to 30% for television) because
relatively fewer children are active Internet users. The FTC chose these percentages because
they are approximately double the percentages of children and adolescents in the medium’s
overall audience. The Commission inferred that a company intended to target children or
adolescents by advertising on a show or website that disproportionately attracted youth to such a
high degree.
Although the “percentage of audience” approach runs some risk of under-inclusiveness –
i.e., by not capturing ads placed on programs that have a relatively low percentage, but high
number, of child or adolescent viewers – it established an adequate benchmark for future
assessments of whether food advertisers have altered their youth-targeted marketing. By
comparison, an approach that focuses on overall child or adolescent exposure to food ads runs a
much higher risk of over-inclusiveness. An exposure approach does not distinguish between ads
placed on children’s programming and ads placed on general audience or adult programs that
happen to have many child viewers. Although exposure data might show whether children and
adolescents are seeing more or fewer ads in particular food categories,41 these data would not aid
the Commission’s assessment of whether the level of intentional targeting of youth with food
and beverage ads has changed over time.
Separately, an exposure approach could substantially increase the compliance burden on
the companies. An ad for a food product might generate a substantial number of youth
impressions simply because it ran on programs with large general audiences, such as American
Idol or The Simpsons. Yet, the same ad might never have run on shows watched predominantly
by children or adolescents. Thus, an exposure approach potentially could encompass many more
food products than the percentage of the audience approach.42
Finally, the Commission notes that the FTC43 and several outside researchers have
conducted exposure analyses of food and beverage television advertising.44 In addition, the
Commission’s follow-up report will include: an analysis of television expenditures on the top

41

To do this comparison, the Commission also would have to collect this data for 2006, further
increasing the compliance burden on the companies.
42

Indeed, GMA asserted that the FTC’s criteria of a “30% Children Audience” and a “20%
Adolescent Audience” are too broad to determine if certain types of advertising are directed to
children or adolescents. GMA comment at 3.
43

FTC Bureau of Economics Staff Report, supra note 14.

44

E.g., Harris, et al., Rudd Center for Food Policy & Obesity at Yale Univ., Cereal F.A.C.T.S.
(2009), available at http://www.cerealfacts.org/media/Cereal_FACTS_Report.pdf; Powell, et al.,
Nutritional Content of Television Food Advertisements Seen by Children and Adolescents in the
United States, 120 Pediatrics 576-83 (2007); Powell, et al., Exposure to Food Advertising on
Television Among U.S. Children, 161 Archives of Pediatrics & Adolescent Med. (2007).
13

five broadcast shows for children and adolescents based on audience share; data on online
display ad impressions for foods generated on child- or teen-oriented websites; and an analysis
of time spent by youth on websites operated by food companies based on data purchased from
media research firms.
New media. The RWJF Center and Children Now suggested that the FTC gather
additional expenditure data for new media, such as information on paid search term and display
advertising, email marketing, mobile marketing, digital marketing, social media marketing, and
behavioral targeting.45 Both commenters referenced increased use of emerging digital media
practices in the last few years.46 The RWJF Center also requested that the Commission assess
the effectiveness of online and mobile marketing by evaluating companies’ implementation of
self-regulatory policies and use of other measures of advertising effectiveness.47
As it did for the 2008 Report, the Commission will request expenditure data for the forms
of new media identified above, including online display advertising, e-mail marketing, mobile
marketing, and digital marketing. In addition to reporting on expenditures and promotional
activities for these types of marketing, the follow-up report will include an analysis of online
display advertising that may be targeted to youth and time spent at food company websites by
youth, using data acquired from comScore and Nielsen Online. The Commission also will
obtain data from comScore’s Ad Metrix Mobile service to evaluate how much mobile marketing
teens see and the amount of food ads they see relative to ads for other types of products on the
mobile platform. For data on the effectiveness of online and mobile marketing and the use of
behavioral targeting, the Commission will obtain marketing research studies from the food
companies; to the extent the companies have researched the appeal and effectiveness of new
media platforms and behavioral targeting to individuals under the age of 18, the Commission
will evaluate and report on that research.
Market research data. The RWJF Center requested that the FTC obtain information and
expenditures on neuroscience and biometric studies used for developing or implementing food
advertising, as well as research on advertising effectiveness.48 The FMC Workgroup agreed that
the FTC should seek information on novel market research techniques (e.g., neuromarketing and
biometric measures).49

45

RWJF Center comment at 1; Children Now comment at 1.

46

RWJF Center comment at 1; Children Now comment at 2.

47

RWJF Center comment Attachment 1, Section B.

48

RWJF Center comment at Attachment 1, Section C. RWJF Center also suggested that the
Commission evaluate the types of databases and services used to conduct market research, and
the demographics of market research participants. Id.
49

FMC Workgroup comment at 2.
14

The FTC has incorporated into the proposed 6(b) Orders specific requests for market
research on advertising effectiveness and neurological or other factors that may contribute to
food advertising appeal among youth. More generally, the Commission believes the wording of
the proposed Specification on market research is sufficiently broad to yield the type of
information described by the commenters.
Targeted demographics data. Several comments supported the Commission’s proposal to
collect information on food and beverage marketing directed to youth based on gender, race,
ethnicity, or income level. The Commission believes this information is important to collect
given the prevalence of obesity within particular minority youth populations.50
The FMC Workgroup and the AACORN noted that ethnic minority youth is the fastest
growing segment among the youth population, and at the same time is at greater risk for obesity
and related diseases.51 In addition, the AACORN cited to research indicating that AfricanAmerican and Hispanic youth are exposed to more food marketing for less nutritious foods than
youth in the general population.52 The FMC Workgroup and the AACORN suggested that the
FTC obtain information on the ethnic minority youth groups targeted, the manner in which they
are selected, the campaigns and products directed to those groups, and expenditure and exposure
data for new media targeting those groups.53
The Commission’s proposed Specification on targeted youth marketing based on gender,
race, ethnicity, or income level seeks information on most of the issues identified by the
commenters. For example, companies must identify the specific sub-populations to which
reported expenditures and activities relate. In addition, companies must identify which of their
policies and market research pertain to marketing to individuals of a specific gender, race,
ethnicity, or income level.
Nutrition information and data on certain food product categories. A key
recommendation of the FTC’s 2008 Report was for industry to improve the nutritional profile of
foods marketed to children and adolescents.54 In order for the FTC to adequately assess the
scope of nutritional improvements between 2006 and 2009, the Commission will gather detailed
nutrition information from food and beverage companies.
50

For example, data from the Centers for Disease Control and Prevention (CDC) indicate
disparities among adolescent racial and ethnic minorities, with prevalence of obesity highest
among Hispanic adolescent boys and African-American adolescent girls. CDC website at
http://www.cdc.gov/obesity/childhood/prevalence.html. See also Surgeon General 2010 Report,
supra note 4, at 2-3.
51

FMC Workgroup comment at 4; AACORN comment at 2.

52

AACORN comment at 1.

53

FMC Workgroup comment at 4; AACORN comment at 2.

54

See, e.g., FTC 2008 Report, at 67.
15

For purposes of evaluating changes in the nutrition profile of foods marketed to youth,
the CFBAI recommended that the Commission consider the nutritional density of products and
meals (e.g., servings of fruit or vegetable in a food).55 In addition, the CFBAI requested that the
FTC analyze reductions in calories, fat, sugars, and sodium in products advertised by CFBAI
participants between 2006 and 2009. The CFBAI also requested that the Commission examine
marketing expenditures based on the food groups (e.g., fruit, dairy) contained in products and
meals marketed to youth.56 The RWJF Center requested that FTC gather data on the specific
products promoted by quick service restaurants in their advertising (e.g., kids meals, value
meals).57
The Commission believes the types of nutrition data it proposes to collect are in keeping
with the recommendations of the CFBAI and the RWJF Center. As described above (supra, p.
8), the FTC proposes to collect information on the nutritional density of products and meals
marketed to youth, such as the fruit, vegetable, whole grain, and protein content per food
serving. Likewise, the FTC will be able to analyze changes in calories, fat, sugars, and sodium
of youth-marketed food products based on the nutrition data the Commission proposes to collect.
As indicated in the proposed Section 6(b) Order, the Commission will ask restaurant companies
to list specific menu items, including those offered as children’s meal combinations, advertised
to youth in 2009 and 2006 and to provide expenditure and nutrition data for each item. The
Commission intends to evaluate youth-directed food marketing nutrition data in a manner
consistent with the approach it took for analyzing the 2006 expenditure data, and will report
nutrition trends on an aggregated basis by food category and media category.58
d.

Suggestions for Minimizing the Burden of the Information Collection

In the September 2009 Notice, the FTC invited comments on ways to minimize the
burden of the collection of information on recipients of the 6(b) Orders. The FTC received one
comment in response, from GMA. No individual companies submitted suggestions.

55

CFBAI comment at 4.

56

CFBAI comment at 4-5.

57

RWJF Center comment at Attachment 1, Section E.1.

58

As an alternative to providing nutritional information for each product advertised to youth,
GMA suggested that the Commission extrapolate changes in the nutritional content of foods
marketed to children and adolescents from 2006 to 2009 by collecting samples of product
nutrition labels and allowing companies to estimate the number of products to which the labels
apply. GMA comment at 2-3. The Commission does not believe that GMA’s suggested
approach will provide accurate and reliable information upon which to evaluate the nutritional
profiles of foods marketed to youth today as compared to those marketed in 2006.
16

GMA suggested that the FTC eliminate or consolidate collection of data from categories
that accounted for few expenditures or activities based on the 2006 information collection.59 As
indicated in the proposed 6(b) Order, the Commission consolidated the collection of certain
categories of information, such as combining the candy and frozen dessert food categories and
the word-of-mouth and viral advertising categories.
GMA urged the Commission to wait until after March 30, 2010 to issue Section 6(b)
Orders, because 2009 calendar year data generally is not available until late in the Second
Quarter of 2010.60 This is a reasonable request and, under the current proposed time frame, the
Commission would not issue Section 6(b) Orders until Summer 2010. GMA also requested that
the Commission allow companies 120 days, rather than 90 days, to respond to the requests.61 The
Commission believes that 90 days is a reasonable deadline. The Commission will entertain
requests for limited extension of the deadline on a case-by-case basis as it did in connection with
the 2006 data collection.
GMA asked that the FTC apply narrower criteria for youth-directed reportable
expenditures than those used in the 2007 Orders to avoid over-reporting. For example, GMA
asserted that some of the FTC’s data requests were not tied to actual or potential audience
thresholds, resulting in over-reporting of ad expenditures for programs in which seventy percent
or more of the audience were not youth. GMA also indicated that it was overbroad to use “G”
and “PG” ratings as criteria for defining youth-directed movie theater spending, and “E” ratings
to define youth-directed video game spending.62 As reflected in the proposed 6(b) Order, the
Commission has narrowed the criteria for adolescent-directed movie theater and video game
advertising by omitting reference to “PG” and “E” ratings and instead basing the determination
on whether the viewing audience constituted at least 20% persons ages 12-17. For assessing
child-directed advertising, the Commission believes it is reasonable to maintain use of the “G”
movie rating and the “EC” rating for video games.
GMA suggested that the Commission drop the request for expenditure data on
advertising purchased during the “Top 5” television shows – that is, the five broadcast programs
with the largest number of adolescent viewers.63 In the 2008 Report, the Commission did not
include these expenditures in the aggregated figures of money spent on advertising to children
and adolescents. Rather, the information was “noted separately . . . to illustrate the point that
children and adolescents are exposed to a great deal of advertising that is directed to a general,

59

GMA comment at 1.

60

Id. at 2.

61

Id.

62

GMA comment at 3.

63

GMA comment at 3.
17

primarily adult, audience.”64 In the proposed 6(b) Order, the Commission has decided not to
request 2009 expenditure data for the “Top 5” television shows; instead the FTC will purchase
those data from a media research firm.
Finally, GMA is concerned about the burden of collecting nutritional data from
companies. The Commission does not believe that requiring companies to provide the
information is burdensome. First, the nutrient data that the FTC proposes to seek are limited and
are commonly analyzed in evaluating the nutritional quality of food marketed to children.65
Second, food and beverage companies often maintain databases with detailed ingredient
information about their products in order to observe proper compliance control issues and food
safety and labeling standards. The Nutrition Labeling and Education Act of 1990 and FDA
regulations require packaged foods to bear nutrition labeling, which contains the majority of the
nutrition content data that the Commission seeks.66
e.

Accuracy of Estimated Burden of the Information Collection

In the September 2009 Notice, the FTC invited comments on the accuracy of the
agency’s estimate of the burden of the proposed collection of information. The Commission
estimated the total hours burden to be 12,250 and the total cost burden to be $3,675,000. The
FTC offered broad ranges for estimated costs, which were separated into single-category and
multiple-category company ranges, in order to account for differences in the number of brands
and the amount of marketing the companies engage in for each brand.
GMA commented that the Commission underestimated the burden to companies to
respond to the proposed 6(b) Orders. GMA instead anticipated the cost to be $100,000 or more
for each company that markets a single product category and $1 million or more for each
company that markets multiple product categories.67 As indicated in Section 12 below, the
Commission has revised its burden estimates from those stated in the September 2009 Notice to
reflect estimated burden hours of 17,550 hours and an estimated total cost of $5,265,000.
However, for the following reasons, the FTC does not believe the likely burden to be as high as
GMA’s estimate. First, the FTC proposes to send the 6(b) Orders to virtually the same group of
companies that received the information requests in 2007, and it anticipates that the companies’
experience answering the 2007 requests will inform their responses to the proposed 6(b) Orders,
thus lessening the time needed to compile and submit the data to the FTC. Second, the
Commission has incorporated into the proposed 6(b) Orders detailed guidance, instructions, and

64

FTC 2008 Report at Appendix A, at A-4.

65

The data provide a snapshot comparing calendar years 2006 to 2009; the FTC does not
propose to seek information on each nutritional change that occurred between 2006 and 2009 for
individual products.
66

21 U.S.C. § 343(q); 21 C.F.R. 101.9.

67

GMA comment at 2.
18

templates for companies to use when responding to the orders, in order to promote clarity and
efficiency.
f.

Other Requests Contained in Comments

Children Now requested that the FTC obtain information from children’s media
companies regarding their policies for, and revenues from, licensing characters used to promote
food and beverage products.68 The FMC Workgoup also requested that the Commission gather
information from media companies.69 To be consistent with the FTC’s prior information
collection, the Commission does not intend to expand the scope of Section 6(b) Order recipients
to include children’s media companies. The Commission believes that staff will be able to glean
relevant information about media companies’ policies and practices on use of licensed characters
in food marketing via the information on cross-promotions and use of licensed characters that
will be provided by the food and beverage companies.70
The FMC Workgroup suggested that the FTC collect information on: (1) the extent to
which companies gather personally identifiable information from children and teens; and (2) the
scope of data profiles companies maintain on youth populations.71 These issues are outside the
scope of Commission’s focus on food marketing to children and adolescents.
9.

Payments and Gifts to Respondents
There is no provision for payments or gifts to respondents.

10. & 11.

Assurances of Confidentiality/Matters of a Sensitive Nature

In connection with the information requests, the Commission will receive information of
a confidential nature. Under Section 6(f) of the FTC Act, such information will be protected
from disclosure while it remains confidential commercial information. 15 U.S.C. § 46(f). To
protect the confidential financial information it receives, the Commission will aggregate the
information before incorporating it into the report.
12.

Estimated Annual Hours and Labor Cost Burden
Annual Hours Burden: 17,550 hours

68

Children Now comment at 2.

69

FMC Workgroup comment at 5.

70

In a separate inquiry, the staff is analyzing information about how media companies license
their character properties and attendant policies for their use.
71

FMC Workgroup comment at 5.
19

Annual Cost Burden: $5,265,000
FTC staff’s estimate of the hours burden is based on the time required to respond to each
information request. The Commission intends to issue the information requests to 48 parent
companies of food and beverage and quick service restaurant advertisers. Because these
companies vary in size, in the number of products they market to children and adolescents, and
in the extent and variety of their marketing and advertising, the FTC staff has provided a range
of the estimated hours burden.
Based upon its knowledge of the industries and experience with the 2007 Orders and
input from the GMA, the staff estimates, on average, that the time required to gather, organize,
format, and produce responses to the 6(b) Orders will range between 150-300 hours per
information request for companies that market a single category of product to children and
adolescents; thus, an average of 225 hours. Similarly, the FTC staff estimates that companies
that market multiple categories of products to children and adolescents will spend between 300900 hours to respond to an information request; thus, an average of 600 hours. The total
estimated burden per company is based on the following assumptions:
Identify, obtain, and organize product information;
prepare response:

25-175 hours

Identify, obtain, and organize information on marketing
expenditures; prepare response:

50-250 hours72

Identify, obtain, and organize information on, and
samples of, marketing activities; prepare response:

25-200 hours

Identify, obtain, and organize information regarding
product nutrition information and healthy initiatives;
prepare response:

30-200 hours

Identify, obtain, and organize information regarding
market research and marketing to youth of a
specific gender, race, ethnicity, or income level;
prepare response:

20-75 hours

Total:

150-900 hours

72

For companies that use substantial amounts of unmeasured media for advertising and
promotional activities, the hours required to respond will be greater than for companies that
utilize only small amounts of unmeasured media.
20

The Commission intends to send 30 information requests to parent companies that
market a single category of product to children and adolescents. As a result, staff estimates a
total burden for these companies of approximately 6,750 hours (30 companies x 225 average
burden hours per company). The Commission intends to send 18 information requests to parent
companies that market multiple categories of products to children and adolescents. As a result,
staff estimates a total burden for these companies of approximately 10,800 hours (18 companies
x 600 average burden hours per company). Thus, the staff’s estimate of the total burden is
approximately 17,550 hours. These estimates include any time spent by separately incorporated
subsidiaries and other entities affiliated with the parent company that has received the
information request.
It is difficult to calculate with precision the labor costs associated with this data
production, as they entail varying compensation levels of management and/or support staff
among companies of different sizes. Financial, legal, marketing, and clerical personnel may be
involved in the information collection process. The FTC staff has assumed that professional
personnel and outside legal counsel will handle most of the tasks involved in gathering and
producing responsive information, and has applied an average hourly wage of $300/hour for
their labor. Thus, the staff estimates that the total labor costs for the information requests will be
approximately $5,265,000 (($300 x 6,750 hours for companies that market a single category) +
($300 x 10,800 hours for companies that market multiple categories)).
13.

Estimated Annual Capital or Other Non-Labor Costs

FTC staff estimates that the capital or other non-labor costs associated with the
information requests will be minimal. Although the information requests may necessitate that
industry members maintain the requested information provided to the Commission, they should
already have in place the means to compile and maintain business records.
14.

Estimate of Cost to the Federal Government

The FTC staff estimates that the cost to the FTC’s Bureau of Consumer Protection and
Bureau of Economics of collecting this information is approximately $1,750,000. This estimate
reflects approximately ten FTC employee work years, inclusive of benefits, devoted to
collecting, processing, and analyzing the requested information, together with contract and travel
money.
15.

Program Changes or Adjustments
Not applicable. This is a new study.

21

16.

Plans for Tabulation and Publication of Information

The information provided by the respondents will be used to prepare a report that will be
publicly released. The collection of the information will begin after the completion of the OMB
review process. The estimated date for the completion of the report is July 2011.
17. & 18.

Failure to Display the OMB Expiration Date/Exceptions to Certifications

Not applicable.

22