Marketing to Children & School Sales

Global Policy on Responsible Advertising to Children

Our policy provides that on a global basis, we will advertise to children under age 12 only those products that meet PepsiCo’s Global Nutrition Criteria for Advertising to Children. These criteria are grounded in well-established and broadly recognized scientific principles in accordance with international and national nutrition authorities and reflect dietary recommendations of these authorities (e.g. World Health Organization, Food and Agriculture Organization of the United Nations). We also adhere to all relevant laws and regulations within the countries in which we operate.

Our Responsible Advertising to Children Policy prohibits advertising products that do not meet certain nutritional requirements in television programs whose audience profile is made up of greater than 35 percent children who are under the age of 12. Additionally, PepsiCo does not advertise any products to children who are under the age of 6.

We have modified our policy several times over the years to include additional restrictions. In addition to certain marketing restrictions within school environments, it now covers any marketing communications primarily directed to children under 12 that use licensed characters (excluding company-owned, brand equity characters), celebrities and movie tie-ins. Media covered under the policy include TV, radio, print, cinema, online, DVD, direct marketing, product placement, interactive games, outdoor marketing, mobile and short message service marketing.

As social media continues to evolve, we are striving to update the ways in which we market our products while maintaining our responsible marketing practices. We face new challenges in applying our policy to emerging application technology and the availability of audience data. We are engaging with partners and external organizations, such as advertising agencies, media vendors and organizations like the World Federation of Advertisers (WFA), to understand the continuously evolving marketing landscape and adapt accordingly. We have also been rolling out training programs so marketers understand the implications of applying our policy to the digital space, and discuss with them how new technologies might help us to adapt our policies going forward.

Global, Regional & National Pledge Programs

We have also signed on to industry-led voluntary initiatives through several global, regional and national Pledge Programs. These programs are all based on the principle that signatories advertise only products that meet specific common nutrition criteria to children under the age of 12. In the event there are conflicts between PepsiCo’s Advertising to Children Criteria, and any Pledge Program common nutrition criteria and/or any applicable laws, PepsiCo will apply the strictest criteria for each nutrition category.

Compliance Monitoring & Reporting

Around the world, each division and region within PepsiCo has a process for reviewing and approving marketing campaign materials to, among other things, drive compliance with our Responsible Advertising to Children Policy and Pledge Programs. While these processes may vary, they all typically require cross-functional review, consultation and approval prior to the release of any content. This review is aimed at ensuring our campaigns are in compliance with local laws, clear and truthful, not misleading, in line with our Values and Code of Conduct and are appropriately handling sensitive topics.

PepsiCo monitors and reports compliance with our Responsible Advertising to Children Policy through many of our Pledge Programs around the globe. For example, in 2017 we were compliant with our U.S. and Canada Advertising to Children Pledges, as verified by the Children’s Food & Beverage Advertising Initiative in the U.S. and by Advertising Standards in Canada. In the first quarter of 2018, we achieved 99 percent compliance in the European Union with our responsible Advertising to Children Policy, as verified by Accenture, with compliance measured in France, Germany, Hungary, Italy, Greece, and Spain. This builds on 95 percent compliance with our Advertising to Children Policy in recent years in globally representative markets such as Colombia, India, New Zealand, Philippines, and South Africa. In all cases, these compliance figures represent the latest available data.

Sales of Our Products to Schools

In 2006, in the U.S., PepsiCo was proud to take a leadership role as the only food and beverage company to sign voluntary agreements regarding sales of both snacks and beverages in schools with the Alliance for a Healthier Generation – at the time, a joint initiative of the William J. Clinton Foundation and the American Heart Association. Both agreements represented break-through steps to adopt a practical policy in the U.S. that provided a sensible solution for young people, parents and educators. These agreements served as a precursor to the current “Smart Snacks” national nutrition standards for foods and beverages sold in schools established by the U.S. Department of Agriculture.

Outside of the U.S., PepsiCo’s global policy for beverage sales in schools focuses on providing water, juice, milk and low-calorie beverages for students. PepsiCo-owned bottling operations offer nutritious hydration options for students and work with schools to eliminate full-calorie soft drinks in primary and secondary schools. We work with our independent franchise bottlers, third-party vending companies and other PepsiCo beverage distributors, as well as schools and local authorities, to apply this policy beyond PepsiCo's direct operations. It should be noted that because our policies alone cannot determine the actions of businesses outside our operational control, our products sometimes may be sold in schools by independent third parties. However, we view our policy as an opportunity to engage our industry peers and local authorities in adopting similar policies. It will ultimately take a collaborative, industry-wide effort to ensure consistently more nutritious options in schools.