Is McDonald's a Villain?

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"McDonald's (NYSE: MCD  ) is the stranger in the playground handing out candy to children."

So says The Center for Science in the Public Interest (CSPI), who announced Tuesday that it served the fast food giant with a notice of intent to sue over "unfair and deceptive marketing." According to a CNN report, the letter accused McDonald's toy-related promotions of violating state consumer protection laws in several states. The organization says using promotional toys to entice children instills bad eating habits that can lead to obesity, diabetes, and other diet-related diseases.

McDonalds, of course, disagrees. A spokesman said: "We couldn't disagree more with the misrepresentation of our food and marketing practices ... McDonald's is committed to a responsible approach to our menu, and our Happy Meal offerings."

The CSPI notice gives McDonald's 30 days to agree to stop the practice before a suit is filed.  

In 2006, fast-food companies including McDonald's competitors Yum! Brands (NYSE: YUM  ) , Burger King (NYSE: BKC  ) , and Wendy's Arby's Group (NYSE: WEN  ) spent more than $520 million on advertising and toys to market children's meals, according to the Federal Trade Commission.

And this certainly isn't the first time McDonald's has been accused of corrupting children's diets. Interestingly, a study led by Stanford University researcher Dr. Tom Robinson, in 2007, showed that preschoolers preferred food wrapped in McDonald's packaging (presumably the result of powerful marketing). The study had kids sample identical McDonald's foods -- including carrots, milk, and apple juice -- in both name-brand and unmarked wrappers. Remarkably, the unmarked foods always lost the taste test. 

Dr. Robinson concluded that the kids' perception of taste was "physically altered by the branding." However, a University of Chicago marketing professor commented on the study saying, "I don't think you can necessarily hold this against [McDonald's]," since the goal of marketing is to build familiarity and sell products.

What do you think? Is McDonald's a villain, or simply kid-friendly? And if so, should other fast food establishments cease their marketing practices to children as well? Let us know in the comments box below.

Claire Stephanic does not own any shares of the companies mentioned. Yum! Brands is a Motley Fool Options recommendation. Try any of our Foolish newsletter services free for 30 days. You can read The Motley Fool's disclosure policy here.

Read/Post Comments (4) | Recommend This Article (8)

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  • Report this Comment On June 23, 2010, at 3:08 PM, harispicks wrote:

    I wish people would stop demonizing corporates for every damn thing that is wrong with this country

  • Report this Comment On June 23, 2010, at 5:33 PM, readyever123 wrote:

    Sorry but maybe the parents who are responsible for kids should be the one getting letters.. Kids will eat what ever taste good. We all know that most foods that taste good are not usually good for you.. So in the end the parents should control what kids eat because kids want the good stuff!!

    Why not send letter to parents from CPS informing them that they may have to appear in court for not maintaining a healthy kid.. If a kid smokes and the parents give them cigarettes the parents would go to jail.. why?? Because cigarettes are bad... How about all they junk kids are getting these days.. Who gets it for them?? It's not like they have jobs.. Sorry parents are responsible..

  • Report this Comment On June 23, 2010, at 9:30 PM, ayaghsizian wrote:

    I agree with the above comments. When kids want fast food its up to the parents to make eating healthy food sound more fun and appetizing. The tone of voice we use in our family to encourage healthy eating helps the kids enjoy the healthier choices. We only stop by McDonalds once or twice a year for convenience.

  • Report this Comment On June 23, 2010, at 9:51 PM, xetn wrote:

    What, hold parents responsible? That would be unsocialistic! How could we sue MCD if we tried to hold parents responsible? There would be no wealth transfer. Parents do have big bucks.

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