Inside Track

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October 27, 2011

Take the Money and Run

By: rebecca

 

Hank Cardello isn’t your typical obesity prevention advocate.
 
For one, he’s a former soda company executive — an industry often lambasted by those working to reverse childhood obesity. He also spent time at major food companies such as General Mills, which frequently come under fire from the health advocacy community.
 
But Cardello, now the director of the Hudson Institute’s Obesity Solutions Initiative, thinks that working to solve the obesity epidemic makes good business sense. And now he says he has the evidence to back this up.
 
The Hudson Institute released Cardello’s report “Better-for-you Foods: It’s Just Good Business” last week, which shows food and beverage companies whose product lines include more “better-for-you foods” (BFYs) have higher profits overall. BFYs are roughly defined as those foods and beverages that have fewer calories or are otherwise healthier than more traditional options.
 
Already there’s been a response from the industry. Cardello tells The Inside Track that he’s received calls from several companies and industry groups asking if he’ll share more about the report’s findings with them in person. “Obviously, if they believe us, we can move them to into action,” he says.
 
To come up with the findings, Cardello and his team examined sales data from grocery and drug stores, financial metrics, return to shareholders, company reputation and favorability rankings to analyze whether BFYs affected key business performance measures. They found that companies with a higher percentage of product sales in BFY category perform better financially.
 
As the report puts it, healthier products equal healthier profits.
 
The numbers are convincing. BFYs accounted for just under 40 percent of sales, the report finds, but contributed to more than 70 percent in sales growth in the past five years. Companies that grew their BFYs more than traditional ones shows 2 ½ times the operating profit growth, the report finds, while shareholder returns were 1 ½ times higher for companies selling above-average levels of BFYs.
 
But Cardello admits his report isn’t without some controversy. Both industry officials and health advocates have expressed concern about the BFY formula used in the report. Industry folks have called the definition of BFYs too strict, while the advocacy community expressed worry it doesn’t go far enough. 
 
With criticism coming from all sides, Cardello jokes that he must have gotten something right. “You understand what it's like to run for office as a centrist,” Cardello says, laughing.
 
Cardello plans to conduct similar research in the restaurant industry, working to see whether chains that offer healthy menu items also bring in higher profits. 
 
Above all, Cardello says he thinks the report shows that advocacy and industry can be partners in working to reduce obesity. Advocates should keep in mind that business leaders are driven to bring in profits for their companies. It’s vital “to demonstrate to them it’s worth their while” to introduce healthier items.
 
“It’s so important to understand how business makes their decisions,” Cardello says. “You have to know what the other party wants, and what their needs are, and then you can work from there.”
 
Full disclosure: The report was partly funded by the Robert Wood Johnson Foundation (RWJF). PreventObesity.net is a project of RWJF.
 
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Appearances Can Be Deceiving

By: elizabeth

 

A few years back, the makers of Doritos potato chips decided to re-launch two flavors of chips that had been discontinued in the 1980s, banking that a new generation of young people would become new consumers of the calorie-filled snack.
 
The folks at Frito-Lay knew that convincing kids to eat the chips would take more than a catchy advertising jingle. Instead, they created “Hotel 626,” a sophisticated Internet game that brought the flavors “Back from the Dead” in creepy ways.
 
But the game was actually just a clever marketing effort aimed at teenagers. Users could “check in” at the hotel to play —only between the hours of 6 p.m. and 6 a.m., adding to its allure — and they were required to enter their names and email addresses. They then used their webcams, mobile phones, Twitter feeds and a custom Facebook application to play. 
 
Flashy with a touch of fright, Hotel 626 proved incredibly popular among teens. It cost less than $1 million but was so successful the company launched a sequel the next year. It also caught the attention of consumer advocates, who were concerned about the game’s deceptive marketing practices.
 
Last week, several consumer advocacy agencies filed a complaint with the Federal Trade Commission, asking the agency look into the marketing practices of PepsiCo and its subsidiary, Frito-Lay. The complaint alleges that Hotel 626 and its related campaigns are deceptive, disguising themselves as videogames and other entertainment when they are really just ads. The filers also say the games solicit personal information from minors without parental consent and violate the FTC’s endorsement guidelines.
 
It’s unclear how the FTC will handle the compliant, although the agency said it will take a serious look at it. 
 
Meanwhile, Hotel 626 is just the tip of the Internet advertising iceberg. A new report from the National Policy and Legal Analysis Network to Prevent Childhood Obesity (NPLAN) reveals exactly how big digital marketing targeted to teens has become — and how effective.
 
Digital Food Marketing to Children and Adolescents” takes a hard look at the trend, with authors Kathryn Montgomery and Jeff Chester writing that marketers have gotten especially creative. McDonald’s created the digital world of Pandora closely tied to the movie Avatar. Users explored the fictional planet — while also seeing McDonald’s products pop up within the game play.
 
Such marketing tactics take advantage of the adolescent brain, which isn’t fully developed, researchers argue. The techniques create an “augmented reality” that fosters impulsive behaviors. It also employs neuromarketing, which triggers subconscious and emotional arousal for teens.
 
In their report, Montgomery and Chester call on both industry officials and regulators to develop a set of fair marketing principles to guide companies that use digital media when marketing to kids. The duo have experience in this area: They led the successful campaign that led to the passage of the Children’s Online Privacy Protection Act.
 
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On the Scene

By: elizabeth

 

It wasn’t just A-list foodies and celebs like Mario Batali, Ellie Krieger and Morgan Spurlock who promoted the merits of a healthy food system in Times Square on Monday — PreventObesity.net Leaders also joined the festivities on Food Day.
 
Leader Deborah Lewison-Grant and her organization, FoodFight, took part in the “Eat Real, Eat In” Times Square gathering, teaching attendees about the local food movement. Leader Grace Freedman and the rest of our friends from the Blog for Family Dinner movement also were spotted in Times Square, stressing the importance of eating home cooked meals with the family.
 
After that event, the FoodFight team headed to another Food Day event featuring celebrity Chef Marvin Woods, who showed attendees how to whip up healthy snacks and smoothies. 
 
As astute readers of The Inside Track will recall, FoodFight is a New York program that offers an extensive curriculum that teaches students about the food system. It’s designed to teach students about how the corporate landscape and consumer culture has shaped the food system, and how they can work to change it for the better.
 
And students were on hand at the event to show off what they’ve learned, sharing lessons from that curriculum.
 
More than 1,800 events were held nationwide for Food Day, which was primarily organized by our friends at the Center for Science in the Public Interest. 
 
Many folks in the childhood obesity movement celebrated Food Day by taking part in events held at schools, from pre-schools to college campuses. Bobby DeMuro and his North Carolina-based nonprofit group, No Fizz USA, went to a local elementary school to stress the importance of healthy hydration (read: ditch the sugar-sweetened beverages) to students.
 
Some Food Day efforts were designed to spread the word in the media. Leader Dana Woldow wrote several op-eds that appeared in major newspapers in support of serving healthy meals at schools and local food banks. Woldow knows this area well — she’s the co-chair of the San Francisco Unified School District’s (SFUSD) student nutrition and physical activity committee, and created the advocacy group PEACHSF to push for better food in the City by the Bay’s public schools. 
 
In a piece for San Francisco’s alternative online newspaper, Beyond Chron, she writes about how healthy school meals are often so expensive that schools simply cannot afford them — and why it’s vital that we look at fixing our entire food system in order to bring down those costs.
 
In the San Francisco Chronicle, Woldow co-authors an op-ed with Eric Mar arguing that SFUSD should open a central kitchen, which would be a cost-effective method of serving fresh and healthy food to students.
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Just Deserts

By: elizabeth

 

There’s no one right way to help a community that lacks access to fresh and affordable healthy food. 
 
Some have begun offering food trucks that sell fruits and vegetables. Others have spruced up their corner markets with better goods, while many city leaders have worked hard to lure grocers to their neighborhoods.
 
Eliminating food deserts is one of the major challenges facing those working on childhood obesity, and finding effective solutions can require a bit creativity (and a lot of hard work).  It’s one of the reasons why PreventObesity.net is partnering with the Arthur M. Blank Family Foundation to host a special speaker series event on Nov. 2 looking at innovative remedies for food deserts, and you can watch the free program online.
 
 
Scheduled speakers include documentary filmmaker Mary Mazzio, whose film “The Apple Pushers” looks at street vendors selling produce in New York’s food deserts; Cathy Nonas of the New York City Health Department; and Dwayne Proctor of the Robert Wood Johnson Foundation.*
 
Take note, Georgians: Seating at the Atlanta event is limited. But anyone can click here to watch the live webcast starting at 6 p.m. Eastern time on Nov. 2. No registration is required and you can tune in for free.
 
*Full disclosure: PreventObesity.net is a project of RWJF.
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Trending this morning: Healthy People 2010

By: elizabeth

“Trending this morning: Healthy People 2010 misses targets on obesity and health disparities. Bit.ly/nU2fJo” —@amednews, the Twitter handle of American Medical News, in a Monday tweet. A review of the Healthy People 2010 project finds that while the nation’s health improved over the past decade because less people are smoking cigarettes, the country fell short of meeting goals to reduce obesity."

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