Kids Under the Influence

The psychology behind marketing to young consumers

Costs and Benefits of Allowing Marketing in Schools

Companies may be taking advantage of schools and kids with marketing

In my previous blog, I discussed the need for greater awareness about the prevalence of marketing for unhealthy foods and beverages that takes place in schools today – and the important new rule proposed by the USDA, and supported by First Lady Michelle Obama, to eliminate marketing of foods that do not meet “Smart Snacks” nutrition standards and cannot be sold in schools

But eliminating marketing for sugary drinks, fast food and candy in schools should be just the first step. While developing their new school wellness policies, schools should also reevaluate the financial benefits they receive from all forms of in-school marketing – and determine whether those benefits are worth the costs to students’ health and well-being.

First the benefits: Corporations have money, and most schools don’t have enough. Companies offer schools – “free of charge” – much-needed equipment, such as scoreboards and coolers, educational materials, and rewards for academic achievement. They sponsor school events, arts programs, and athletic teams at a time when school budgets for these programs are being eliminated. They provide ready-to-implement fundraising programs to raise money for schools, and schools receive a portion of the proceeds of foods sold in vending machines.

These programs provide companies with the opportunity to show that they care about children and schools get something extra for their students that they couldn’t otherwise afford – a win-win for schools and their business partners. Right?

Unfortunately, research has shown that the funds schools receive from these programs don’t amount to much. For example, vending contracts contribute a total of $2 to $4 per student per year. A national survey of schools showed that two-thirds of branded fundraisers raised no money at all for schools. And those “free” scoreboards, coolers, and counting books all prominently feature brand logos, typically for sodas, sports drinks, and candy – many of the same products that children are taught to consume “in moderation.”

Yet in-school marketing programs are extremely valuable for corporations. School spaces are relatively free of marketing messages compared to other marketing venues, and school-based marketing is often “embedded” within the school environment, making it less easily recognized as advertising and thus more effective. Marketing in schools implies that trusted teachers and administrators endorse these products. And students are a captive audience – they are guaranteed to see these messages every day they are in school, often many times per day. Marketers understand the mere exposure effect – continuous exposure to brand names and logos increases liking and long-term preferences for their brands.

In fact, companies have done the cost-benefit analysis – as they would for any marketing program. And for companies there is no better marketing venue to achieve direct and guaranteed access to students, reach them every day in their natural environment, and with the implicit endorsement of trusted teachers and school administrators. In-school marketing is an important tool in companies’ arsenal of marketing techniques specifically designed to increase purchase and consumption of their brands and recruit this extremely profitable group of young consumers as lifelong loyal customers.

So companies receive significant benefits from marketing to children in schools, while schools receive little or no financial benefit from these transactions. But what about the costs?

I took a look at the marketing numbers. Food companies spend $125 million per year on school-based marketing programs targeting teenagers, on average $8 per high school student in the United States. One study found an average of 49 posters and signs for foods and beverages in high schools. That would amount to 2,250 marketing impressions per student per year (assuming conservatively that students pass by one-quarter of those signs during their school day, 180 school days per year), costing advertisers $3.55 per thousand impressions (CPM in ad lingo). In contrast, display ads on the internet run about $3 CPM, a radio ad would be around $6 CPM, while television ads average $25 CPM.

In other words, school-based marketing doesn’t cost companies much. In fact, it is one of the cheapest forms of marketing available. Rather than contributing philanthropically to schools – companies may actually be taking considerable advantage of schools and their students.

In contrast, the potential long-term cost to students’ health and well-being is immeasurable. Soda brands and sports drinks represent 90% of in-school marketing expenditures, while marketing for fast food, snacks, and candy also appear in schools. Although companies will no longer be able to market many of these same products in schools, they have already found a way to get around the rules. New “copycat” products such as Doritos Reduced Fat Flavored Tortilla Chips and Betty Crocker Fruit Roll Ups with Reduced Sugar meet the new standards, but they are not available in supermarkets. As a result, this marketing will likely increase children’s preferences for the unhealthy versions of these brands that are widely available outside of schools – and may increase perceptions that these products are healthy snacks.

Furthermore, I’m not convinced that even marketing for truly nutritious foods and beverages benefits students and families. Programs that encourage children to purchase or prefer one brand over another – the goal of every type of marketing – undermines parents’ authority to make decisions about what they feed their children. Branded products also are usually more expensive than store brands and unbranded fruits and vegetables – so marketing can make it more expensive for parents to purchase the nutritious products children learn about in school. Sure, parents can always say “no.” But why is it acceptable for companies to set parents up in that way? In addition, in-school marketing is more prevalent in low-income communities, making the expense of branded products an even greater issue.

Requiring schools to incorporate standards for food marketing in their wellness policies will likely spur a broader public discussion of commercialism in schools. That’s an important first step in evaluating the true costs and benefits of allowing companies to market directly to children in our schools.

The Rudd ‘Roots website has more information about marketing in schools and tools for parents and school officials to help design their school wellness policies.

Jennifer L. Harris, Ph.D., M.B.A., is at the Rudd Center for Food Policy and Obesity at Yale University.

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