Survey Results (60 GWU MBA Students)

Click on pie chart to get percentages:

Online Survey Result

answered question
58
skipped question
1
Response
Percent
Response
Count
Including the toy in the Happy Meal is ethical
34.5%
20
The toy is deceptive marketing but McDonald's should be allowed to include a toy
34.5%
20
The toy is deceptive marketing so McDonalds should NOT be allowed to include it.
19.0%
11
Not sure
6.9%
4
Other (please specify)
5.2%
3

Sunday, February 27, 2011

McDonald's Happy Meal Conundrum



Childhood Obesity has tripled in the last 30 years (CDC). In two studies conducted by the Center of Disease Control – one in 2003 to 2004 and one in 2005 to 2006 – that included 8,165 children ages 12 to 19, approximately 16 percent of these children were obese -- having a body mass index at or above the 95th percentile on United States growth charts. Sadly, this number has tripled in the last 30 years.

Overweight children are being diagnosed with many obesity-related illnesses which previously were only seen in adults. Consequently health care costs due to obesity has risen and if allowed to go unchecked will grow to about 21% of health care spending by 2018, according to a 2009 report conducted by the American Public Health Association. Thus health care has become a critical, hot button issue especially in light of the recently-signed Patient Protection and Affordable Care Act which aims to reform the private health insurance market and provide better coverage for those with pre-existing conditions.


As health care costs of treating obesity-related illnesses escalate, the spotlight has recently being focused on the burgeoning fast food industry. Since the food industry is saturated with fierce competition for customer loyalty, fast food chains have promoted extra value portions, $1 deal perks and toys for children.

These perks have been popular in a country reeling from a double-digit recession. Busy and budget conscious families find fast food both convenient and affordable especially single parent families who find it challenging to prepare healthy meals for their children. According to a 2004 study conducted by the National Center for Children Poverty, single-parent families are more than twice as likely to be low-income as two-parent families (59% of single-parent families are low income compared to 23 percent of two-parent families).

The trial lawyer industry using the tobacco-lawsuit model in the 1990’s have over the last decade zealously argued that the fast food industry should be held responsible for the growing obesity rates and burgeoning health care costs. The 2004 critically-acclaimed documentary ‘Super Size Me,’ not only educated millions of viewers worldwide but convinced McDonald’s to eliminate the “super sizing” option from their menu and offer a more healthier menu that focuses on salads, grilled foods, and less salt and saturated fats.

Today the focus on McDonald’s and other fast food chains has shifted from making portions smaller and healthier to banning advertising that targets children. Arguably no children's meal product has been more successful than the Happy Meal. Ever since the first Happy Meal was sold in 1979, McDonald’s has released thousands of varieties of toys, making them a treasured collector’s item.  The toy is an ingenious promotion tool since advertisers pick up the tab to include them in the meal, and it the main reason why over 2.5 million Happy Meals are sold each year accounting for nearly 40 percent of McDonald’s profits.

Lately, the growing campaign has been mounted against the Happy Meal with both San Francisco and Santa Clara County, California, banning restaurants from giving away free toys. The Center for Science and Public Interest (CSPI) is suing McDonald’s to remove the toy claiming that “when McDonald’s bombards children with advertisements or other marketing for Happy Meals with toys, many children will pester their parents to take them to McDonald’s.”

McDonald’s defended their position based on the First Amendment’s free speech clause. Furthermore, McDonald’s argued that the Happy Meal has a more healthy option of chicken McNuggets, low fat caramel dip and low fat milk.



So, is the CSPI looking out for the best interest of consumers and their children, or are they politically posturing on a hot button issue that's sure to gain broad-reaching attention? Do McDonald's have a social responsibility to ensure that the toy has no correlation to obesity and inform Americans have such a finding? Should they consider eliminating the happy meal altogether for the benefit of the 16 percent of children who are fighting a daily war against obesity?  How about the parents -- do they have a responsibility in saying "no," to their children and ensuring they get the proper amount of exercise?  Will there only be one main winner here, or should they all, for the benefit of all Americans, work out a compromise that in the long run make kids slimmer and tamp down the burgeoning costs of healthcare that is gripping this country by the waist line.