Marketing Regulation and Consumer Behavior: Ethical Issues in

Marketing to Children
Angela Hadjiphani
Primary School Teacher
St. Lazarous Primary School
Lycourgos Hadjiphanis
Lecturer
Marketing and Research
Course Coordinator Postgraduate iploma in !usiness Administration
College o" Tourism and Hotel Management
Loizos Christou
Senior Lecturer
Accounting# $conomics and !usiness Studies
Course Coordinator !usiness Studies
College o" Tourism and Hotel Management
Abstract
Marketing ethics is the area o" applied ethics# %hich deals %ith the moral principles
&ehind the operation# and regulation o" marketing. Children are identi"ied &y marketers as
immensely po%er"ul consumers. Such potential pro"ita&ility has highlighted childhood as
an economic construct and accompanied an aggressi'e mo'e to%ards marketing to young
people. This paper e(amines the unethical practices o" organizations to%ards children.
Ho%e'er# i" marketing to children is truly to &e practiced ethically# marketers need to &e
a%are o" ethical e(pectations &eyond their o%n su&jecti'e paradigm.
Introduction
)n Saturday May *+# +,,-# The Haravgi ne%spaper in Cyprus reported that - years
old Antreas Christou &id nearly .-/,#,,, "or a Po%er Ranger toy on e!ay. The dramatic
headline# 0Antreas# -# !1S .234m 5)R P)6$R RA78$R )7 $!A9:# suggests that
despite children:s ina&ility to understand the concept o" money# they are still targeted
%ith and suscepti&le to promotional messages that esta&lish a desire to go out and &uy.
Children are identi"ied &y marketers as immensely po%er"ul consumers. Such potential
pro"ita&ility has highlighted childhood as an economic construct ;ay# +,,,<# and
accompanied an aggressi'e mo'e to%ards marketing to young people ;8unter =
5urnham# *>>?<. 5urthermore# companies need to understand the ethical issues in
marketing to children. The a&o'e 0&iding: is just a small e(ample o" an unethical issue in
marketing to children.
*
Marketing ethics is the area o" applied ethics# %hich deals %ith the moral principles
&ehind the operation# and regulation o" marketing. Some areas o" marketing ethics such
as the ethics o" ad'ertising and promotion o'erlap %ith media ethics. Many people
&elie'e that marketing needs to respect its o%n moral principles and ethics other%ise#
marketing is inherently e'il. Their position is &ased on the argument that marketing
necessarily commits at least one o" three %rongs. 5irst# marketing is damaging personal
autonomy. The 'ictim o" marketing in this case is the intended &uyer %hose right to sel"@
determination is in"ringed. Second# marketing is causing harm to competitors.
$(cessi'ely "ierce competition and unethical marketing tactics are especially associated
%ith saturated markets. Third# marketing is manipulating social 'alues. The 'ictim in this
case is society as a %hole. The argument is that marketing promotes consumerism and
%aste. To continue# there are three possi&le "rame%orks o" analysis "or marketing ethics
%hich are as "ollo%sA
*. Balue@orientated "rame%orkA analyzing ethical pro&lems on the &asis o" the 'alues
%hich they in"ringe ;e.g. honesty# autonomy# pri'acy# transparency<.
+. Stakeholder@orientated "rame%orkA analyzing ethical pro&lems on the &asis o"
%hich they a""ect ;e.g. consumers# competitors# society as a %hole<.
2. Process@orientated "rame%orkA analyzing ethical pro&lems in terms o" the
categories used &y marketing specialists ;e.g. research# price# promotion<.
1t is important to mention that none o" these "rame%orks allo%# &y themsel'es# a
con'enient and complete categorization o" the great 'ariety o" issues in marketing ethics.
Ethical Issues in Market Audience, in Advertising and in Promotional Activities
1n addition there are some ethical pit"alls in the market audience. Targeting the
'ulnera&le such as the children and the elderly is a major ethical issue. 1n the case o"
children# the main products are unhealthy "ood# "ashion%are products and entertainment
goods. According to Mc8ee ;*>>-# p. /+< CChildren are a lucrati'e market. Children
t%el'e and under spend more than D** &illion o" their o%n money and in"luence "amily
spending decisions %orth another D*E/ &illion.F This is due to the "act that children are
not capa&le o" resisting or understanding marketing tactics at younger ages. 5urthermore#
ethical pit"alls in ad'ertising and promotional content include issues %ith 'iolence and
se(. Se(ual innuendo is a mainstay o" ad'ertising content and yet is also regarded as a
"orm o" se(ual harassment. Biolence is another ethical issue especially "or childrenGs
ad'ertising. The ad'ertising o" certain products may strongly o""end some people %hile
&eing in the interests o" others. The ad'ertising o" condoms has &ecome accepta&le in the
interests o" A1S pre'ention# &ut is ne'ertheless seen &y some as promoting promiscuity.
Some companies ha'e actually marketed themsel'es on the &asis o" contro'ersial
ad'ertising. Sony "or e(ample# has "reHuently attracted criticism "or unethical content
;portrayals o" Iesus %hich in"uriated religious groups<.
+
Ethical Marketing to Children
CMarketing to children is a major concern to regulators and consumer groups. A major
reason "or this concern is e'idence &ased on Piaget:s theory o" cogniti'e de'elopment
that children are not a&le to "ully comprehend commercial messages. This had led to rules
issued &y &oth the 5ederal Trade Commission and the Children:s Ad'ertising Re'ie%
Jnit ;CARJ< o" the 7ational Ad'ertising i'ision o" the Council o" !etter !usiness
!ureausF ;Ha%kins# !est# = Coney# +,,4# p. -2*<. These rules "ocus mainly on &eing
sure that ad'ertisements are clearly separated "rom the program content and that the
%ords and pictures in the ad'ertisements do not mislead children ha'ing limited cogniti'e
skills. C1n addition to concerns a&out children:s comprehension o" ad'ertisements# there
is concern a&out the e""ect o" the content o" commercials on children. The e(tensi'e
ad'ertising o" high@"at and high@sugar products raises a concern a&out its e""ect on the
health o" childrenF ;Ha%kins# !est# = Coney# +,,4# p. -2*<. There"ore# since children
di""er in their a&ility to process consumer in"ormation# many serious ethical issues are
raised &y such promotion ;Solomon# !am&ossy# = Askegaard# +,,+<. There are
Huestions a&out the a&ility o" children to understand ad'ertising and its intent and not &e
decei'ed and manipulated &y it. $(perts say that children donGt understand persuasi'e
intent until they are eight or nine years old and that it is unethical to ad'ertise to them
&e"ore then. 1n addition# young children# in particular# ha'e di""iculty in distinguishing
&et%een ad'ertising and reality in ads# and ads can distort their 'ie% o" the %orld.
Additionally children are una&le to e'aluate ad'ertising claims. Thus# ethical Huestions
arise %hen they are e(posed to di""erent marketing acti'ities and messages. 1t is "or these
reasons that marketing to children should &e care"ully restricted. 1n particular
ad'ertisements aimed at children under the age o" > years old# including on the internet
and during childrenGs tele'ision programmes# should &e &anned. Such ad'ertising
su&sidizes the cost o" these ser'ices at the cost o" our childrenGs 'alues# sense o" %ell@
&eing# health and integrity. Moreo'er the "uture o" the planet is at stake i" ad'ertisers and
marketers turn children into hyper consumers o" the "uture.
There are other marketing acti'ities aimed at children other than tele'ision ad'ertising
that cause ethical issues. CChildren:s ad'ocates are no% particularly concerned a&out
marketing to children on the 1nternet. The "ederal go'ernment has passed legislation to
protect children:s online pri'acy ;Children:s )nline Pri'acy Protection Act<. CARJ also
has guidelines on this topicF ;Ha%kins# !est# = Coney# +,,4# p. -2+<. The use o" the
1nternet to target children raises ethical issues. Marketers design sites so that children are
a&le to &ypass adult super'ision. Sometimes they present o&jectiona&le materials to
underage consumers or pressure them to &uy items or pro'ide credit card num&ers. 6hen
this happens# it is likely that social pressure and su&seHuent regulation %ill result.
Additionally# 1nternet ad'ertisers elicit personal in"ormation "rom the children &y getting
them to "ill out sur'eys &e"ore they can play and o""ering prizes such as T@shirts "or "illing
in lengthy pro"iles that ask "or purchasing &eha'ior# pre"erences and in"ormation on other
"amily mem&ers ;5itzgerald# *>>E<. Ad'ertisers then use this personal in"ormation to
cra"t indi'idualized messages and ads targeted at each child. The ads are integrated %ith
the other content o" the internet site %hich is designed to keep the children engrossed in
play "or hours at a time. There are e'en product 0spokes characters: to interact %ith the
2
children and de'elop relationships %ith them so that long lasting &rand loyalties can &e
de'eloped.
As early as the *>4,s# marketing to%ards young people &ecame more aggressi'e. An
e(panding glo&al economy "rom the *>/,s and demographic and cultural changes "rom
the *>?,s meant research into the economic po%er and targeting o" children %as gi'en
greater emphasis ;8unter = 5urnham# *>>?<. Clarke ;*>??< and Lindstrom ;+,,4< ha'e
re"erred to the 0child consumer:. A large proportion o" such research is Jnited States @
&ased. Ho%e'er# the children:s market in the Jnited Kingdom is also su&stantial. Mintel
;*>>,< estimates that in *>-># *-L o" the JK population %as represented &y /@to@*/ year
olds# %ho collecti'ely held a direct spending po%er o" o'er .E,, million. Since the *>E,s
the potential pro"ita&ility o" children as a market has &ecome a key "ocus "or marketers#
especially %ithin the toy industry ;Mc7eal# *>>>M Mintel# *>>,<. Toys represent
children:s chie" desires# accounting "or up to //L o" their non@"ood purchases ;Mintel#
*>>,< and /4L o" their "irst purchase desires. As such# attitudes to toy products and
concepts o" &rand# ad'ertising# and promotion are indicati'e o" a child:s consumer
education more &roadly. To continue# ad'ertisers spend *,,s o" &illions o" dollars a year
%orld%ide encouraging# persuading and manipulating people into a consumer li"estyle
that has de'astating conseHuences "or the en'ironment through its e(tra'agance and
%aste"ulness ;urning# *>>+<. Children are increasingly the target o" ad'ertising and
marketing &ecause o" the amount o" money they spend themsel'es# the in"luence they
ha'e on their parents spending and &ecause o" the money they %ill spend %hen they gro%
up. 6hilst this child@targeted marketing used to concentrate on s%eets and toys# it no%
includes clothes# shoes# a range o" "ast "oods# sports eHuipment# computer products and
toiletries as %ell as adult products such as cars and credit cards. 9oung people are so
%ealthy that children 4 to *+ years old ha'e a com&ined annual income o" nearly D*/
&illion# D** &illion o" %hich they spend. This group directly in"luences more than D*E,
&illion in "amily household purchases. 5urthermore# children indirectly in"luence &et%een
D2/, &illion and D4,, &illion %orth o" purchases a year ;Mc7eal# *>>+<. This
consumption po%er that children ha'e makes marketers to ignore the ethical issues#
%hich are related to children# and they design aggressi'e marketing programs and
strategies in order to target them. The children market is a huge and 'ery pro"ita&le one
and there"ore marketers try their &est not only to in"luence them# &ut to in"luence their
parents as %ell. Mconalds "or e(ample# the "ast "ood giant is o"ten seen as unethical as
it aims itGs ad'ertising at children# %hom it is clearly a%are %ill irritate their parents to go
to &uy a &urger. Such is the case in Cyprus# that %hen parents ask their children to get
ready "or dinner# they get their coat and shoes on and say %hen %e are going "or a GHappy
MealG# the child meal o" MconaldGs. !anks do a similar role# through its ad'ertising to
children# &y pro'iding "ree incenti'es to open an account. Through these aggressi'e
marketing acti'ities# &anks &elie'e they %ill retain the child throughout its li"e. Also
unethical is marketing# %hich promotes an adult product in a child seducti'e manner# or a
child product %ith a clear empathy on adult &eha'ior. 5or such a reason all computer
games are no% age@coded much like the 'ideo classi"ication to help to pre'ent seduction.
Parents today &uy more "or their kids &ecause trends such as smaller "amily size# dual
incomes and postponing children until later in li"e mean that "amilies ha'e more
4
disposa&le income. As %ell# guilt can play a role in spending decisions as time@stressed
parents su&stitute material goods "or time spent %ith their kids. Marketers take ad'antage
o" these trends they design marketing strategies in order to satis"y the needs o" the
children and the needs o" the parents %ho "eel guilty "or not spending much time %ith
their children. To continue# marketers employ strategies and programs in order to target
e""ecti'ely the children. 5irst# marketers use the 0Pester po%er: to in"luence children:s
decision@making. Pester po%er re"ers to childrenGs a&ility to nag their parents into
purchasing products they may not other%ise &uy. Marketing to children is all a&out
creating pester po%er# &ecause marketers kno% %hat a po%er"ul tool it can &e. According
to Sutherland = Thompson ;+,,2# p.*>E<# Cpestering or nagging can &e di'ided into t%o
categoriesM persistence and importance. Persistence nagging is not as e""ecti'e as the
more sophisticated importance nagging. This latter method appeals to parentsG desire to
pro'ide the &est "or their children# and plays on any guilt they may ha'e a&out not ha'ing
enough time "or their kids.F
Second# marketers are using researchers and psychologists in order to conduct research
regarding childrenGs de'elopmental# emotional and social needs at di""erent ages. Jsing
research that analyzes childrenGs &eha'iors# marketers are a&le to de'elop aggressi'e
marketing strategies to target young people. Third# marketers try to position their &rands
in the minds o" the young children# in the hopes that this &rand recognition %ill gro% into
li"etime relationships. !rand loyalties can &e esta&lished as early as age t%o# and &y the
time children goes to school most can recognize hundreds o" &rand logos. 5ast "ood
companies# toy companies# clothing companies and &anks ha'e &een culti'ating &rand
recognition in children "or years. The Sports 1llustrated magazine "or e(ample# has
launched kid and teen editions that &oast ads "or adult related products such as mini'ans#
hotels and airlines. 5ourth# marketers are using &uzz marketing or street marketing %hich
is a ne% t%ist on the %ord o" mouth method. Marketers "ind the coolest kids in a
community and ha'e them use or %ear company:s product in order to create a &uzz
around it. !uzz marketing is a 'ery po%er"ul tool "or marketers &ecause it can help the
company to success"ully esta&lish a relationship %ith the sa''y teen market in order to
gi'e their products cool status. !uzz marketing is 'ery popular to the 1nternet# %here
young 07et promoters: use chat rooms and &logs to position and promote products among
unsuspecting users.
Conclusion
To conclude# a distinct di'ide &et%een industry and social perspecti'es on the issue o"
ethics precludes a state o" mutual understanding and acceptance. 1" marketing to children
is truly to &e practiced ethically# marketers need to &e a%are o" ethical e(pectations
&eyond their o%n su&jecti'e paradigm. To continue# %hile the potential po%er o"
marketing strategies and programs to persuade consumers ine'ita&ly raises Huestions o"
ethics# this is especially so %hen those consumers are children. $thical issues are no%
&ecoming a method o" producing 'alue to the organization and "reHuently producing
pro"its i" marketers manage them e""ecti'ely. 1n addition# e'ery organization must make a
conscious decision as to %hat sort o" ethical stance it is to take regarding children.
5inally# marketers need to consider the major ethical issues in marketing to children
/
&ecause children do not ha'e the a&ility to understand the di""erent promotional mi(
messages %hich they see e'ery day. Ho%e'er# these promotional mi( messages ha'e the
a&ility to in"luence the children in order to target them. There"ore# the manipulation o" the
psychological &eha'ior o" the children is a 'ery serious ethical issue and marketers need
to &e a%are o" it.
Re"erences
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ay# L. A. ;+,,,<. Ethics in media communication: Cases and controversies ;2rd $d.<.
CanadaA 6ads%orth.
urning A. ;*>>+<. How much is enough: The consumer society and the future of the
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5itzgerald# 7. ;*>>E< 6atching the KidsA the 1nternet opens a ne% "ront in the &attle o'er
childrenGs ads# ADEE! Eastern Edition# 2- ;E<# +/@42
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Mc7eal# I. ;*>>+<.A Handbook of (arketing to Children) 7e% 9orkA Le(ington !ooks.
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Mintel# ;*>>,<. 9outh li"estyles. Retrie'ed *- Septem&er# +,,?# "rom
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Soloman# M.# !am&ossy# 8.# = Askegaard# S. ;+,,+<. Consumer behavior: A $uropean
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Sutherland# A.# = Thompson# !. ;+,,2*) !idfluence: The marketer+s guide to
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E
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