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Kraft Limits on Kids' Ads May Cheese Off Rivals

Kids won't know how to spell their bologna's first name anymore.

When Kraft Foods said it would stop advertising junk food to kids under 12, it took what its executives call "a step in the right direction" to improving its image among parents and public-health advocates worried about childhood obesity.

But its decision could increase pressure on the rest of the food industry to alter its marketing ways, and it could challenge television networks that are competing hard for advertisers against the robust kid appeal of videogames and the Internet.

Kraft said yesterday that it would stop television, print and radio advertising for products such as Oreos, Chips Ahoy! and most Oscar Mayer Lunchables meals on programs targeted to children ages 6 to 11. That means Kraft plans to pull ads for those products from programs such as "SpongeBob SquarePants" on Viacom's Nickelodeon. The Washington Post reported Kraft's plans yesterday.

Despite the retreat from certain shows, the company still will get its messages out through a host of prime-time TV shows, licensing deals, Web sites and other outlets that increasingly are attracting the attention of children and marketers alike.

"You can't avoid 2- to 5-year-olds on television, much less 6- to 11-year-olds," says Jon Mandel, chief global buying officer of Mediacom, the media-buying firm owned by Grey Global Group. "At any point there are half a million kids watching Letterman every week." More children watch prime-time television than shows directed specifically at kids, he adds.

Kids' media habits show how difficult it will be for Kraft to steer its messages away from children. Some critics say Kraft should do more. "It's a step, but it's a baby step," says Susan Linn, a psychologist at Judge Baker Children's Center in Boston and the author of "Consuming Kids." "What they really need to do is stop using cartoon characters to market food to children," she adds. Kraft isn't eliminating tie-ins with characters such as Shrek or SpongeBob SquarePants on its packages or in other promotions.

Mark Berlind, Kraft's executive vice president for corporate affairs, says, "We realize there are going to be other concerns and that this announcement today doesn't answer all the questions." But he says the move is "a step in the right direction" and that Kraft wants to remain "part of the continuing discussion" about childhood marketing and obesity.

Kraft's competitors were little moved by the company's decision. A Coca-Cola spokeswoman says the company has had a policy for 50 years not to advertise soft drinks to children, but those restrictions didn't play a role in its policies about vending machines or movie tie-ins. A spokeswoman from Kellogg says the company advertises responsibly to children using "age-appropriate" language and content, but she didn't outline specific age restrictions. Representatives from General Mills and Kellogg both said they follow industry guidelines and didn't expect major changes in their policies.

The changes at Kraft will affect products that make up about 10% of the company's annual revenue, or about $3 billion. Kraft says it will continue to advertise healthier products to younger children, but that those products will have to fulfill strict nutritional criteria the company has determined, such as less than 100 calories per serving, and under a certain level of fat. Mr. Berlind says the company doesn't plan to reduce its advertising spending to children, simply to shift the focus of it to healthier products.

Kraft's advertising shift comes just several months before the kids upfront market, the time of the year when about $700 million to $800 million in national kids-TV advertising is sold to deep-pocketed marketers, officially kicks off. "There will definitely be an impact on the kids upfront," says Jason Maltby, co-executive director of national TV at WPP Group's Mindshare.

Kraft is the third-largest food marketer to children, behind General Mills and Kellogg, which dominate because of their children's cereal advertising. Kraft spends roughly $90 million a year marketing to children, while General Mills spends about $167 million and Kellogg spends about $120 million, according to industry estimates.

Kraft's announcement came the same day the U.S. government issued its guidelines for how Americans should eat, and was a signal that Kraft is seeking to pre-empt government regulation of children's advertising.


Sarah Ellison, The Wall Street Journal. January 13, 2005

Copyright © 2005 Dow Jones & Company, Inc.. All rights reserved.