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International: Sorrell: junk food ads will go online

22-November-2006
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International: Sorrell: junk food ads will go online

Sir Martin Sorrell has warned that Ofcom's junk food ad ban for children's TV could result in marketing budgets switching to the internet.

Sir Martin, the chief executive of the world's second largest advertising and marketing group, WPP, says that despite the industry backlash at Ofcom's restrictions they "had to happen".

"I don't think it is helpful to the TV and media industry, but it is understandable and it had to happen," he said.

"A lot of it will migrate to the web where there is less control over what happens. I don't think [the overall impact of the new restrictions] will be that serious [for the UK ad industry], but it is certainly not helpful."

Brands including Burger King - which last week pre-empted Ofcom's announcement by stating it would stop advertising during kids' programmes - Pepsi and Pizza Hut have already attempted to tap into hugely popular websites such as YouTube with branded pages.

Domino's, which is likely to have to scrap its decade-long sponsorship of The Simpsons on Sky One as a result of the Ofcom restrictions, has already said that more money would go into other advertising opportunities outside TV, including supporting its e-commerce services, "in the face of increasingly fragmented viewing habits".

The Advertising Standards Authority has a limited remit for regulating internet advertising, but a spokesman admits it has only dealt with "a couple" of cases all year.

The ASA can rule on viral ads and paid-for advertising online, but it does not cover any claims or marketing a company makes on a website of its own creation as it is classified as "editorial material".

"As far as complaints are concerned, parents don't seem to take much notice of online advertising compared with TV, " said Mark Wood, the UK sales manager at digital marketing company Webside Story.

"That is probably because, while TV advertising is broadcast to family audiences and is overt, online ads are often seen only by the web user at the time."

Under Ofcom's existing broadcast-only regulations it would be possible for a junk food brand that is not allowed to advertise during, for example, The X-Factor TV show to run ads on its website.

"Manufacturers are bound to be looking at a full range of mediums where such restrictions don't apply including the internet, outdoor and radio," said Guy Phillipson, the chief executive of the Interactive Advertising Bureau.

"However, I wonder if advertisers will elect to adhere to some sort of internal guidelines about advertising in some other media in light of the Ofcom TV ruling to avoid criticism."

Online spending by fast-moving consumer goods companies, including junk food brands, has traditionally lagged behind that of firms using the medium for direct response purposes such as the financial services and recruitment sectors.

However, this is set to change. Group M, the combined media planning and buying operation of WPP, puts online spending by brand advertisers at somewhere between £200m and £300m for 2007; it puts spending in 2006 at less than £100m.

"Although this FMCG migration will be hard to measure precisely, the new food advertising regulations will accelerate this migration," said Adam Smith, the futures director at Group M.

Source: MediaGuardian

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