Marketing to Children: Where is the Line and Who Enforces it?

Does your business target a youth demographic?

Does your industry have age regulations?

Are you looking to expand your advertising campaigns to include children?

If you answered 'yes' to any of these questions, you should be aware of regulations that apply to businesses that market their products or services to children.

Advertising and Marketing Laws Apply to all Businesses

All businesses must comply with advertising and marketing laws - failure to do so could result in costly lawsuits and civil penalties. To brush up on the basics, see Business.go;s Advertising Law Guide for guidance on how to legally advertise your business.

When Children are Involve-

We all know that children under the age of 18 can't buy tobacco products - and under the age of 21 can't by alcohol products - but what about restrictions for other products, like violent video games, junk food, or even toys?

Generally, i-s a paren's decision to exercise judgment on what is appropriate for their child. However, small businesses must understand that the government enforces additional marketing regulations for products that target children.

The Federal Trade Commission (FTC's Division of Advertising Practices protects consumers from unfair or deceptive advertising and marketing practices that raise health and safety concerns, as well as those that cause economic injury. Equipped with law enforcement capabilities, a portion of this division's services are dedicated to monitoring and stopping fraudulent alcohol, tobacco, violent entertainment, and food advertising practices that target children. Because the FTC recognizes the increased susceptibility of the child audience, it also protects children from unfair and deceptive marketing practices in general industries such as with toys.

Regulations in Practice

When it comes to regulating misleading or deceptive campaigns that target children, the FTC has several criteria for determining what constitutes as a violation:

1. The representation, omission, or practice must be likely to mislead the consumer
2. The act or practice must be considered from the perspective of a reasonable consumer
3. The representation, omission, or practice must be material, that is, likely to affect a consume's choice or conduct, thereby leading to injury

When the FTC is examining cases specific to a particular demographic' in this case children' it makes its judgment based of the prospective of a typical member of that demographic. For these purposes, an ordinary child would be the audience in mind. Simply put, comply with all general advertising marketing practices, and in addition, do't use marketing practices that would specifically alter a chil's judgment, rather than an adul's judgment.

The FTC clarifies what constitutes as a misleading or deceptive marketing practice, in examples of past cases that the commission has brought legal action against:

• Deceptive Performance Claim in Toy Advertisement A television ad depicted a ballerina doll performing a pirouette however when the toy was used in the real world, it could not perform the same pirouette.

• Nutritional Claim for Foods that are Likely to be Appealing to Children Television ads claimed that the calcium contained in Wonder Bread helped children's minds work better and aids their memory. Although brain function requires some calcium, this claim was unfounded and could provide no evidence suggesting its truth.

• Theory of Unfairness Television ads encouraged children to call 900 numbers to have conversations with and receive prizes from popular childhood figures such as Santa Clause and the Easter Bunny. Because charges for these calls were billed to parents' telephone bill, the FTC determined the ad was unfair because parents did not have control to decline or regulate the charges.

Industry Self-Regulation

Often, FTC enforcement of child advertising is complimented by industry self-regulation. In some cases, guidelines implemented by the industries themselves are stricter than those applied by the FTC. For example, after congressional reports surfaced claiming that many companies were not in compliance with the regulation that alcohol ads should not be placed in media with a 50% or more audience that is under 21 years old, additional codes of conduct were implemented by the alcoholic beverage industry. Consequently, nearly 100% of all alcohol companies now meet this requirement (which was recently updated to 30% of the media audience).

The FTC guide, Advertising to Kids and the FTC, has more information on these regulations and additional case examples.

Online Advertising

The Children's Online Privacy Protection Act (COPPA) was enacted to regulate the privacy and safety of children online and restrict predatory marketing practices. This federal law requires websites who collect or use personal information on children under the age of 13 to obtain verifiable parental consent. Enforceable by the FTC, it provides a guide that outlines the proper steps for websites to follow when looking for parental consent.

OnGuardOnline.gov, an FTC sponsored website, has more information on COPPA and how to comply with online advertising practices that apply to children.

Related Resources

• Children's Advertising Review Unit (CARU)* - Informational guide on CARU's Self-Regulatory Program for Children's Advertising.
• Online Advertising Law - Business.gov guide to all the basic rules of online advertising.

* Directs user to a non-government website.