A tangled web

Marketing to children Jillian Pitt

About Consumer Focus

Consumer Focus is the statutory consumer champion for England, Wales, Scotland and (for postal consumers) Northern Ireland. We operate across the whole of the economy, persuading businesses, public services and policy makers to put consumers at the heart of what they do.

Consumer Focus tackles the issues that matter to consumers, and aims to give people a stronger voice. We dont just draw attention to problems we work with consumers and with a range of organisations to champion creative solutions that make a difference to consumers lives.

Acronymns used in the report

ASA BCAP CAP DMA DMC EACA EASA IAB ICC ISBA ISP MRS WFA

AA Advertising Association
Advertising Standards Authority Broadcast Committee of Advertising Practice Committee of Advertising Practice Direct Marketing Association Direct Marketing Commission European Association of Communication Agencies European Advertising Standards Alliance European Society of Market Research Internet Advertising Bureau International Chamber of Commerce Incorporated Society of British Advertisers Institute of Sales Promotion Market Research Society Point of Purchase Advertising International World Federation of Advertisers

ESOMAR

POPAI

Consumer Focus

Contents

Executive summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Introduction .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Why it matters .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Codes, principles and regulatory practices .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Inconsistencies and gaps .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Conclusions .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

Marketing to children

Executive summary

This report researches current regulation and highlights where children are not adequately protected by either the law or industry selfregulation. The aim is to try and disentangle the complexity of the regulatory landscape for parents on how they can best protect their children from unwanted advertising and for businesses to comply with statutory codes when trying to best protect children. The coalition Government has indicated it will take action to protect children from excessive commercialisation and crack down on irresponsible marketing. Consumer Focus recognises that there have been recent developments by industry to further protect children but certain gaps do still remain. We have used research on the regulatory landscape to propose recommendations for how children can be better protected and have highlighted where the gaps and inconsistencies lie within present regulations.

Three key issues highlighted by our research are: 1 Codes of practice are dispersed across a wide range of bodies. At least 20 different self-regulatory and statutory codes of practice relate to marketing and advertising practices, data protection, research, privacy and parental involvement. These are supplemented with ad-hoc trade association codes of practice and initiatives related to, for example, the marketing of food and drinks high in fat, salt and sugar (HFSS) There is a lack of transparency in how the various regulatory and self-regulatory bodies relate to each other. The lack of an overall monitoring mechanism for integrated marketing campaigns targeted at children further compounds the issue Consumer Focus calls for greater transparency in the process used to implement existing codes and developing new ones

We would like to see the current system consolidated and simplified with gaps and inconsistencies addressed to make it easier for advertisers to navigate their way through and put childrens needs at the heart of what they do.

Our recommendations are to:

Consumer Focus

 simplify the whole process and ask trade associations to relate their members guidelines specifically to the Advertising Standards Authority (ASA) align the definition of a child as under 16 for all codes tackle the issue of identifying children and their parents online have a uniform system of labelling online marketing communication regulate brand ambassadors within the ASA and ban this practice for under 16s clarify the position for wishlists put the onus on industry to make it clear to children and their parents which marketing techniques are used and what they are designed to do call on ASA to further extend the Committee of Advertising Practices (CAPs) digital remit to cover brands and logos appearing by association and marketing communications in foreign media, and to include sponsorship, packaging and point of sale within the wider remit of ASA make specific provision for children in privacy legislation

Marketing to children

Introduction

In recent years the use of integrated marketing techniques and digital technology to market products to children has increased significantly. Integrated marketing techniques encompass a range of different media including TV, the internet and direct mail; and digital technologies such as SMS. A number of regulatory problems have become apparent as traditional distinctions between different media have become blurred. There is no single transparent set of standards and procedures governing either contemporary integrated marketing techniques or how products are marketed to children. Marketing to children in the UK must comply with three pieces of EU legislation and an Ofcom rule as well as the substantial codes of practice of the two main UK co-regulatory bodies: the Committee of Advertising Practice (CAP) and the Broadcast Committee of Advertising Practice (BCAP). The Ofcom rule comes under the BCAP code. Members of the Market Research Society (MRS), the Direct Marketing Association (DMA), the Internet Advertising Bureau (IBA) and a growing number of other marketing trade organisations are also bound by other industry-specific codes of practice. There has also been a recent proliferation of new statutory and voluntary initiatives addressing how food and drinks high in fat, salt and sugar (HFSS) are marketed to children.

Companies have to invest significant time and resources to making sure they are compliant with legislation, regulations and industry-specific codes of practice. This can be difficult and even impractical for new or small companies and those unaware of, or unaffiliated to, trade bodies. It is also highly unlikely parents are fully informed of the regulations designed to protect children or of where they can complain if they think a marketing campaign is irresponsible. It is equally difficult for consumer interest groups to ascertain if campaigns are not complying with legislation, regulations or codes of practice.

Consumer Focus

Why it matters

Children as consumers
In the UK, 105 billion a year is spent on children . Worldwide, this figure is US$2 trillion2. While companies selling products aimed at children are eager to profit from this market, consumer interest groups are keen to prevent children from being exploited. The rise in the number of obese children has turned a particularly bright spotlight on the marketing of HFSS food and drinks. The Buckingham report Impact of the commercial world on childrens wellbeing commissioned by the previous Government concludes that the public is not well informed about the effect of marketing campaigns on children, and some areas of regulation are insufficient3. The current coalition Government has stated its intention to address irresponsible marketing aimed at children.
1

Contemporary marketing practices

In the past, separate self-regulatory bodies used to have discrete codes of practices regulating and monitoring specific media. For example, advertising was monitored by the Advertising Standards Authority (ASA). This regulatory model is now insufficient for overseeing complex integrated marketing campaigns that encompass a range of different media (for example TV, internet, direct mail and posters). This is sometimes referred to as 360 degree marketing because a campaigns messages surround the consumer on all sides. For example, a TV advertising campaign may tell consumers they can find a code on a product pack which can be keyed into a website where they can take a survey and pass on messages about the product to other consumers. While these activities make up a single integrated marketing campaign, the separate elements are regulated by different advertising, sales promotion, internet advertising and market research codes of practice. And, the viral part of the campaign (passing product messages between consumers) is not regulated at all. Consequently, it is both difficult for a company to know if an entire campaign abides by all of the regulations, and for a consumer to know which body to complain to if they are unhappy.

Liverpool Victoria (2010). The cost of raising a child tops 200,000 (Press release, 23 February 2010). Available at: http://bit.ly/c3P9lh (accessed 5 July 2010) Lindstrom, M. (2004). Brandchild: Remarkable insights into the minds of kids and their relationship with todays global brands. Kogan Page. London DCSF (2009). The impact of the commercial world on children's wellbeing: report of an independent assessment. Available at: http://bit.ly/a1UNcu (accessed 5 July, 2010). London. DCSF Marketing to children

Digital platforms
The rapid development of digital technologies such as the internet, SMS, Bluetooth and interactive billboards have further blurred the traditional definitions of marketing activities and consumer touch-points (places where marketing messages appear). The recent extension of the digital remit of the CAP code goes some way to ensuring children and young people are protected online. From March 2011, the ASA will regulate advertisers own marketing communications on their own websites and in other non-paidfor space online. However, there still remains a number of exclusions outside the remit of the CAP code such as marketing communications contained within editorial content and foreign media, ie websites that originate from countries outside the UK. The recently launched Childrens Ethical Communications Kit (Check) website goes some way to provide a one-stop-shop for businesses to find out the rules which apply when marketing to children across platforms in a simple and straight forward way.

But statutory regulations have struggled to keep pace with digital practices and this has resulted in a flurry of stop-gap best practice guides and codes of practice from various industry bodies, including the European Advertising Standards Alliance (EASA)4 and the Internet Advertising Bureau (IAB)5, which, although well meant, have limited influence and can be confusing for both companies, the public and consumer interest groups. When people subscribe to a website, vast amounts of information about them can now be collected quickly and easily using cookies. Consequently, complying with privacy legislation has become an issue for companies. At present UK and European privacy laws do not make any specific provision for children.

EASA (2009). Digital marketing communications best practice. Available at: http://bit.ly/b7WSqU (accessed 5 July, 2010). EASA IAB IAB good practice principles for online behavioural advertising. Available at: http://bit.ly/dDjkJQ (accessed 5 July 2010). IAB

Consumer Focus

Codes, principles and regulatory practices

Codes
Marketing to children is governed by statutory regulation (the law) and self-regulation by industry bodies. At least 20 substantial codes of practice apply to marketing aimed at children. These exist across both statutory regulation and selfregulation (see Figure 1). This list does not include guidelines drawn up by smaller trade bodies or some of the voluntary principles created by food and drinks companies. Some of the codes of practice are internationally applicable, for example, the United Nations Convention on the Rights of the Child and the International Chamber of Commerces Consolidated Advertising and Communications Code. Others are enforceable across Europe, for example, consumer protection regulations and privacy laws. The UK also has its own codes of practice, for example, the CAPs self-regulation code of practice and Ofcoms ruling on marketing HFSS food and drinks to children. Some US codes of practice have been adopted by UK companies, although these are not legally binding in the UK. These include the Childrens Online Privacy and Protection Act. There are also other international voluntary codes of practice on marketing food and drinks to children that some of the major multi-national companies have signed up to. These do influence how they globally market such products to children.

Legislation
The 1990 United Nations Convention on the Rights of the Child (UNCRC) was the first international human rights treaty that grants children (under the age of 18) a comprehensive set of rights covering civil, cultural, economic, political and social matters. The UK signed the convention in 1990, and it came into force in 1992. It is used to guide UK policies concerning children across education, law and order, family policy and even play. The convention draws on the Declaration of the Rights of the Child by the UN General Assembly on 20 November 1959: The child, by reason of his physical and mental immaturity, needs special safeguards and care, including appropriate legal protection. Therefore children everywhere have the basic human right to be protected including in the context of marketing and advertising targeted at them.

Marketing to children

Figure 1: Legislation relating to marketing aimed at children EU directive 95/46/EC The Data Protection Act 1998 Information Commissioner EU directive EU directive 2002/58/EC Privacy and Electronic Communications Regulations 2003 Information Commissioner UK law EU directive 2005/29/EC The consumer Protection from Unfair Trading Regulations 2008

ASA/OFT Monitoring body

There are three EU directives, three pieces of UK legislation and an Ofcom ruling that companies must adhere to. The legislation is shown in Figure 1. The EU Directive 95/46 was enacted as the 1998 Data Protection Act in the UK. The Information Commissioner oversees compliance with this legislation. More recently, the EU Directive 2002/58 was enacted as the 2003 Privacy and Electronic Communications Regulations, and this is also overseen by the Information Commissioner. Both of these relate to the collection and use of personal data. However, there are no special safeguards or provision for children within these two pieces of legislation. This is a major gap which requires urgent EU action.

EU Directive 2005/29 became the Consumer Protection from Unfair Trading Regulations in the UK in 2008 and is important because it specifically outlaws marketing communications which exhort children to ask their parents to buy them goods or services by encouraging pester power. This has been incorporated into the CAP and BCAP codes of practice6. These are regulated by the ASA and are enforceable by the Office of Fair Trading (OFT). A recent co-regulation between BCAP and Ofcom, which came into being in 2007, has given Ofcom the powers to ban television advertising of HFSS food and drinks in and around programmes of particular appeal to under 16s.

CAP code of practice section 5.4, 5.5 and 5.7; BCAP code of practice section 5.9, 5.10 and 5.14

10

Consumer Focus

Regulatory practices
The majority of the codes of practice relating to advertising and marketing to children are regulated by industry or as part of a coregulatory agreement between statutory bodies and industry rather than legislation enforceable in law. Figure 2 shows how Consumer Focus understands these self-regulatory bodies relate to each other there is no known official record of this relationship. The main codes of practice are shown in brown with their relevant monitoring bodies shown in red. The yellow circles denote the major trade bodies, some of which have their own members codes of practice.

Acronyms AA ASA BCAP Advertising Association Advertising Standards Authority Broadcast Committee of Advertising Practice CAP Committee of Advertising Practice DMA Direct Marketing Association DMC Direct Marketing Commission EACA European Association of Communication Agencies EASA European Advertising Standards Alliance ESOMAR European Society of Market Research IAB Internet Advertising Bureau ICC International Chamber of Commerce ISBA Incorporated Society of British Advertisers ISP Institute of Sales Promotion MRS Market Research Society POPAI Point of Purchase Advertising International WFA World Federation of Advertisers

Figure 2: Main bodies making codes of practice ICC WFA

EACA

EASA

MRS Standards Board

ESOMAR Professional standards Committee EU pledge

CAP ASA

BCAP AA

DMA DMC

IAB ISBA
Marketing to children

ISP POPAI

11

The source for the majority of current marketing codes of practice appears to be the Advertising and Marketing Commission of the International Chamber of Commerce (ICC) who first published a code of practice in 1937. The ICC has many thousands of corporate members across a range of industries. It could best be described as performing on a global stage a role similar to that of the Confederation of British Industry (CBI) in Britain. The ICCs codes of practice on advertising and marketing are continually updated, and the 2006 code of practice is currently being reviewed. The following bodies codes of practice appear to derive from the ICC and these have either been reviewed or are under review in 2010: CAP Code (2010) BCAP Code (2010) DMA Code (2003) MRS Code of Conduct (2010) ESOMAR International Code on Social and Market Research (2007)

The BCAPs code of practice applies to broadcast advertising TV and radio while CAPs applies to non-broadcast marketing and advertising, for example sales promotion and many aspects of direct marketing (see Annexes 5 and 6). Despite the trends in integrated marketing practices, the codes of practice remain separate and this is in part due to their heritages. The CAP has been in existence since 1961 and the ASA, an independent body funded by the advertising industry, has administered the code since 1962. BCAP is a relatively new body having been set up in 2004 when the ASAs remit was expanded to cover broadcast advertisements (previously the subject of a separate statutory regime). The Communications Act of 2003 gave Ofcom statutory responsibility for broadcasting standards which it then contracted out to the ASA. This arrangement is now co-regulatory. Significantly, the ASA was unable to investigate more than 2000 consumer complaints in 2009 because they related to commercial communications on companies own websites and, therefore, fell outside its remit of advertising in paid-for space (for example TV, newspapers and billboards). In 2010, after lengthy consultations with industry, the Advertising Association-led Digital Media Group proposed a code of practice to cover advertising on company websites and other non paid-for spaces. This is now under the jurisdiction of the ASA as part of the extended remit of the CAP code which will come into play in March 2011.

12

Consumer Focus

Independent authorities monitor the BCAP and CAP codes of practice. Compliance with these is monitored by the ASA. The CAPs code of practice is legally enforced by the OFT under the Consumer Protection Unfair Trading Regulations 2008 and the Business Protection from Misleading Marketing Regulations 2008. The BCAPs code of practice is co-regulated by Ofcom. In this way, these codes of practice apply to any company. The other codes of practice apply only to the members of each organisation, and are selfmonitored. For example, the Direct Marketing Association (DMA) members conduct is overseen by the Direct Marketing Commission (DMC), and the MRS and European Society of Market Research (ESOMAR) have compliance councils within their own organisations. Codes of practice within each discipline emanate from the ICC and filter down through the regulatory bodies in the UK and the EASA acts as a unifying voice for advertising self-regulation across Europe. However, as we have seen, the marketing industry includes a multitude of diverse activities such as sponsorship, sales promotion, in-school marketing and press advertising. Each activity has spawned a trade association representing and supporting its members and the number of such bodies continues to mushroom in response to new digital marketing channels. Recent groups include the Mobile Marketing Association (MMA), the Mobile Broadband Group (MBG) and the Word of Mouth Marketing Association (WOMMA). Each is anxious to demonstrate it has a set of guidelines that functions in their members interests and shows their worth.

Spending on internet advertising overtook broadcast advertising for the first time in 2009 and the IAB has been very proactive in creating best practice guidelines for its members. However, these guidelines are not independently policed or sanctioned in the same way as the CAP and BCAP codes of practice. Moreover, broadcast and non-broadcast advertising remain within two separate codes of practice with slightly different regulatory mechanisms. Another layer of complexity has been added by the food and drinks industries response to the growing numbers of obese children. There are initiatives instigated by companies acting alone, for example, the PepsiCo Policy on Responsible Advertising and Marketing to Children. And there are those introduced by certain bodies, often as a condition of membership for those bodies, for example, the EU Pledge. A 2010 review by the National Heart Forum for the Department of Health identified 24 such pledges that operate variously on a national or global basis (see Annex 1). Codes of practice initiated by specific industries do have the advantage of the full cooperation of the companies that sign up to them whereas regulations can often meet with opposition. However, these codes of practice and pledges are only as good as the monitoring system that ensures compliance. Companies that do not sign up are, in the main, inadequately monitored.

Marketing to children

13

Inconsistencies and gaps

The existence of too many codes of practice has led to inconsistencies and gaps being created. At the same time, the complicated maze created by these many codes of practice does not adequately reflect the rapidly moving integrated marketing practices used today. In the UK, there are still separate codes of practice for broadcast and non-broadcast advertising. This section takes the relevant parts of the ICC Consolidated Code, from which the other main codes of practice seem to stem, and examines the problematic areas relating to marketing aimed at children.

The age of a child

One of the most fundamental problems with the current system of regulation is the different ages used to define a child. The ICC omitted a definition of a child when writing the consolidated code in 2006. As a result, many of the codes of practice include a variety of ages between 12 and 18, although some do not specify an age at all (see Annex 2). Greater consistency of defining the age of a child would be helpful and less confusing than the current arbitrary system used by some. For example, certain brand names may have a policy to target their advertising messages to children of 12 and over but CAP and BCAP codes define a child as a person up to the age of 16.

Outside of the main CAP and BCAP codes of practice, the guidelines drawn up by industry bodies and companies, for example the IAB and European Advertising Standards Alliance (EACA) tend only to offer protection to children up to 12 or 13 several years adrift of the UNCRC and key UK codes of practice. It is likely that these bodies are following the lead of a key piece of US legislation that came into effect in 2000, Childrens Online Privacy and Protection Act (COPPA) defining children as being under the age of 13. Unlike European governments, the Federal Trade Commission (FTC) in the US has introduced special restrictions on the collection and use of online data from children. The CAP and BCAP clearly define a child as under 16, although some of the new food and drinks regulations strangely only apply to primary and pre-school children. For example, certain
sections of the recently revised BCAP code of practice state promotional offers, licensed characters and celebrities popular with children may not be used in HFSS product advertisements targeted directly at pre-school or primary school children [that is those under the age of 12] on TV or radio. It also says HFSS products cannot aim nutritional or health claims at these children. Certain sections of the CAPs code of practice contain the same prohibition concerning the use of licensed characters, celebrities and promotional offers in advertisements aimed at pre-school and primary school children but do not prohibit them from making health or nutritional claims. It is not clear why the age limit, defined elsewhere in the CAP and BCAP codes of practice as 16, has been relaxed for celebrity endorsement, promotions and health claims. Interestingly, Ofcoms regulation regarding the advertising of HFSS food and drinks applies to television programmes aimed at under 16s. Furthermore, it is also not clear why the CAP and BCAP are unaligned in the area of health and nutrition claims.

14

Consumer Focus

Inexperience and credulity

The ICC Consolidated Code reflects the UNCRC in that it says children have particular rights because they are more vulnerable than adults. A core principle is the protection of children from advertising that may exploit their inexperience and credulity. This is in Article 18 of the ICC Consolidated Code (Annex 3), and point three states marketing communications directed to children should be clearly distinguishable to them as such. Advertisements on television are obviously distinguishable because they occur during a break in programmes, and children from a young age are able to tell the difference between advertising and programming. However, this distinction is less clear in the digital space. Recent research7 showed that only 37 per cent of advertisements on the UKs favourite childrens websites were labelled as such; 21 per cent were integrated into the content (with only 17 per cent of these labelled as advertisements); and even 16-year-olds were unable to identify the commercial intent of certain newer types of advertising such as product placement, where a product is mentioned within a television programme; advergames, where a child engages in a branded game whose purpose is to create brand awareness and emotional attachment; viral marketing, where children are encouraged to send branded messages to friends and family; blog seeding, where children are encouraged to write favourable messages about a brand on blogs; and social networking skins, where children choose branded decorations for the social networking home page. Other research has shown that, when a commercial message is not recognised as such, brand associations are processed implicitly. The effect of the advertisement operates without a childs conscious awareness or control8. This is clearly undesirable. As a result of the extended digtial remit of the CAP code, from March 2011 rules will now apply to advertisements and other marketing communication within companies own websites and within other non-paid-for space.

Fielder, A. Gardner, W. Nairn, A. and Pitt, P. (2007). Fair game? Assessing commercial activity on childrens favourite websites and online environments. London. National Consumer Council and Childnet International. See also Auty, S. And Lewis, C. (2004) Exploring childrens choice: the reminder effect of product placement, Psychology and Marketing, 21 (9), p. 697713 Nairn A. and Fine C. (2008). Whos messing with my mind? The implications of dual process models for the ethics of advertising to children, International Journal of Advertising, Vol. 27, No. 3 p. 447470

Marketing to children

15

Social values
The third substantive part of Article 18 relates to social values and states: Marketing communication should not include any direct appeal to children and young people nor should persuade their parents or other adults to buy products for them. This is reinforced in the 2008 Consumer Protection from Unfair Trading Regulations in the UK and is legally enforceable. The BCAP and CAP codes of practice adequately cover this11. However, Article 18 does not cover messages on company websites which exhort children to persuade others to make purchases for them. Thus, the common practice of wishlists on childrens websites cannot be regulated despite being quite clearly direct appeals to children to get others to make purchases on their behalf. These wishlists encourage children to send emails to family and adult friends with links to e-commerce areas on the website where the company products can be bought. This practice is, in effect, illegal and it is to be hoped that specific provision will be made for this activity to come within the remit of the CAPs extended code of practice, dependent on future test cases.

Avoidance of harm
The ICC Consolidated Code Article 18 says marketing aimed at children should not result in harm mentally, morally or physically.

Offline, this principle is well policed by the ASA in the UK. Chapter 5 of the BCAPs code of practice contains a number of clauses protecting children from various forms of harm and, indeed, the CAPs code of practice echoes the words of the ICC code almost exactly9. However, recent research shows a quarter of advertisements on childrens favourite websites were for products with a legal age limit (16, 17 or 18). These include gambling, cosmetic surgery, obtaining credit and intimate dating10. These constitute potential harm for children and mean monitoring of internet advertising is less well developed than that in other areas.

CAP code of practice section 5.1 Nairn, A. and Fine, C. (2008), Whos messing with my mind? The implications of dual-process models for the ethics of advertising to children, International Journal of Advertising, Vol.27, No. 3 p.447470

10

11

BCAP code of practice sections 5.9, 5.10 and 5.14; CAP code of practice sections 5.4, 5.5 and 5.7

16

Consumer Focus

Article 18 also states marketing should not suggest that a child will have any form of superiority by owning the product being marketed. CAP and BCAP codes of practice reflect this12, but they do not cover the relatively new practice of brand ambassadors whereby children are recruited to demonstrate a product to friends. The effects of this type of marketing on friendship groups have not been researched. It is, however, quite conceivable that the status of brand ambassador confers a social superiority on the chosen children which others will want to emulate.

Data protection and privacy

As noted in Chapter 3, the EU Data Protection Directive (95/46/EC) does not make specific provision for children. This is a serious omission. The implication of Article 19 of the ICC code is that parents should act as arbiters of their childrens privacy rights (see Annex 4). The Article puts the onus on companies to try to involve parents and obtain their consent before information is collected about children. In the UK, these guidelines are implemented in the DMAs code of practice where they apply to all online direct marketing communication to children under 18 (see paragraphs 19.2519.34 in Annex 5). These provisions make it clear that personal data must not be collected from children under the age of 16 without first obtaining a parent or guardians verifiable and explicit consent, and similar consent must be obtained before publicly posting or disclosing such information.

However, there are a number of serious challenges in applying these rules. Obtaining explicit and verifiable parental consent is difficult. Some websites simply ask children to tick a box to say they have obtained consent. Research shows that some children will tick the box without having consulted their parents. Other websites ask for a parents email address so the company can contact them directly. Research shows that some children simply create a new email address that allegedly belongs to their parents. Moreover, the DMAs code of practice states that other peoples personal information must not be collected from children, so collecting a parents e-mail from a child contravenes this section13. Verifying the age of a child on the internet is almost impossible without requiring some sort of official ID card, bank card or passport number documents which not all children possess. And given that neither privacy laws nor the ICC stipulate the age of a child, the position when a child accesses a website which has its legal headquarters in another country, is far from clear. There are also disparities between the privacy regulations relating to a child visiting the website belonging to a company with headquarters in another country.

12

CAP code of practice section 5.2; BCAP code of practice section 5.6

13

DMA code of practice section 19.33

Marketing to children

17

Parental involvement
Chapter D7 of the ICC Consolidated Code relates to advertising and marketing to children using electronic media and the telephone (see Annex 6). It requires companies to encourage parents to supervise their childrens internet activities and not to disclose personal information about a child without parental consent. The provision is very vague and so far none of the UK codes of practice have more specific guidelines for electronic media marketing aimed at children. We have already seen how hard it is to put in place a foolproof mechanism for verifying parents identities. It is also hard to see how parents can be encouraged to supervise their children when they are unlikely to know what websites their children visit. An increasing number of children have internet access in their bedrooms where parents cannot adequately supervise activities. None of the codes of practice have comprehensively tackled the issue of behavioural targeting of children. This is the practice of placing cookies on childrens computers so that data can be collected about which sites children visit, how long they stay there, what topics they discuss, what they buy etc so that targeted advertising can be directed to their computer. The voluntary IAB best practice guidelines simply state advertisers should not create segments of data for under 13-year-olds for the purpose of targeting. However, this does not give children or parents any particular information about, or control over, data that is passively collected. Again, this may be something the marketing industry can tackle with government.

We have seen that the CAPs code of practice is also derived from the ICC Consolidated Code. However, provision in the CAPs revised code of practice is at odds with the DMAs. Section 10.15 of the CAPs code states that marketers must not collect personal information from children under 12 without first obtaining parental permission, while Section 10.16 says marketers must not knowingly collect personal information about other people from children under 16. It is unknown why the first age limit has been revised down to 12 (from the DMAs limit of 16) and why the second has been revised down to 16 (from the DMAs limit of 18). There is a widely held belief in the marketing and advertising industries that the Information Commissioner has said children over the age of 12 are capable of giving their consent for their personal information to be collected and used. However, this belief is not recorded in writing and does not form part of any of the ICCs codes of practice. This belief is also, clearly, contrary to the DMAs code of practice.

18

Consumer Focus

Conclusions

The regulations governing marketing to children are complex. A number of regulatory problems have arisen over recent years with the increased use of integrated marketing communications and digital technology in a rapidly growing childrens market. Regulatory and self-regulatory bodies have not kept apace with developments in integrated marketing practices, particularly those relating to new digital marketing techniques. These techniques are not being reflected in codes of practice. The regulatory model is insufficient for monitoring integrated marketing campaigns. With over 20 different statutory and self-regulatory codes of practice (and many of these issued by a raft of bodies representing their members interest), there is a lack of transparency in how the various bodies relate to each other. Most of these codes of practice relate to a discrete marketing technique, for example, marketing, advertising and direct mail. There is not an overall monitoring mechanism for regulating integrated marketing campaigns. Consequently, it is both difficult for a company to know if an entire campaign abides by all relevant regulations and codes of practice, and for a consumer to know which body to complain to if they are unhappy.

One of the most fundamental problems with the current model is the different ages used to define a child. Across the many codes of practice these vary from 12 to 18, and some do not specify an age at all. There is no provision in current codes of practice for labelling digital advertising. Children are still exposed to inappropriate advertising online. The practice of enabling children to create wishlists on certain websites contravenes the ICC Consolidated Code about pester power. The recruitment of children as brand ambassadors where they promote products to their friends also contravenes the ICC code, yet brand ambassadors are not covered in any codes of practice. Companies have a duty to obtain parental consent before collecting data about children. This duty is difficult for companies to abide by over the internet, and the issue is further complicated when a company has its website in a country outside of the UK. There are also differences in codes of practice between the ages at which companies can collect personal data.

Marketing to children

19

Consumer Focus Artillery House Artillery Row London SW1P 1RT

t: 020 7799 7900 f: 020 7799 7901 e: [email protected] www.consumerfocus.org.uk Media team: 020 7799 8004/8005/8006

Published: October 2010 If you have any questions or would like further information about our research, please contact Jillian Pitt, by telephone on 020 7799 7991 or via email [email protected] For regular updates from Consumer Focus, sign up to our monthly enewsletter by emailing [email protected] If you require this publication in Braille, large print or on audio CD please contact us. Deaf, hard of hearing or speech impaired consumers can contact Consumer Focus via Text Relay: From a textphone, call 18001 020 7799 7900 From a telephone, call 18002 020 7799 7900
Acknowledgement Thanks to Dr Agnes Nairn for her support and comments

ISBN: 978-1-907125-38-6