"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.
