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Sugar Tax Junk Food Advertising

'Unprecedented and unexpected': marketers react to Singapore's ban on high sugar drinks ads


By Shawn Lim, Reporter, Asia Pacific

October 15, 2019 | 7 min read

Singapore is set to become the first country to introduce a ban on advertisements of high sugar packaged drinks in 2020. These drinks must also carry a colour-coded label on the front of the pack to signal that it is unhealthy.

These rules will apply to drinks in bottles, cans and packs that are two- or three-in-one instant drinks, soft drinks, juices and cultured milk and yogurt drinks.

Edwin Tong, Singapore’s senior minister of state for health said these changes are designed to encourage people to make more informed choices and to get manufacturers to reduce the sugar content in packaged sugar-sweetened beverages.

He noted that more than 30 countries have introduced the colour-coded label, with great success. In Chile, for example, the sales of drinks carrying the unhealthy label fell by 25% after one and a half years.

The move by the Singapore government is part of its war on diabetes. It had proposed four possible measures of having a mandatory front-of-pack label, regulation on advertising, a sugar tax, and ban of high-sugar drinks in 2018.

The use of a compulsory label was popular, with 84% out of more than 4,000 people polled voting for it.

Sharing his thoughts on the move with The Drum, Prantik Mazumdar, the managing partner of Happy Marketer says the blanket ban on ads on high sugar content drinks by Singapore is unprecedented and pretty unexpected.

“It will throw a spanner in the works of FMCG companies who would have planned multi-million dollar campaigns to market their drinks,” he adds.

On the other hand, associate professor of marketing Hannah Chang at the Singapore Management University’s Lee Kong Chian School of Business says a total ban on ads of packaged drinks with very high sugar content can encourage FMCG companies to offer new or reformulated products with reduced sugar content for the Singapore market.

For example, in response to consumer trend toward healthier diet over recent years, beverage giants like Coca-Cola and PepsiCo have been actively extending their overall product portfolio with both new and reformulated products like Coke Zero, Diet Coke, Diet Pepsi, sparkling water, while Coke’s Sprite brand has reformulated with less sugar content and calories.

“It makes the companies less dependent on the sales of drinks with very high sugar content, and reduce the potential impact of a total ban on ads of drinks with high sugar content on the company’s overall sales in the longer term,” she explains to The Drum.

Mazumdar notes the colour-coding on the front pack of the beverages is an interesting regulation, something akin to what has been introduced on cigarette packets.

However, Mazumdar says it remains to be seen if it necessarily has a negative impact on sales as in the past, different FMRI-based neuroscience studies that have studied the impact on brain signals and sales after someone was exposed to cigarette packets with those gory statutory warnings, have shown varying results.

“Whilst FMCG brands may experiment with various short term tactical experiments to circumvent these strong regulations, it is in their interest to either evolve the current products into much healthier versions or invest in other healthier food & beverage categories to sustain growth,” he explains.

Chang, however, disagrees and points out that easy to read and clear labelling can help consumers make better, more informed decisions regarding their beverage choices as well as act as a salient reminder.

At the moment, she notes consumers are very often not cognizant of the health or nutrient content in a particular beverage. Even if they are aware, they might not think about it at the moment of choosing a beverage as it simply slipped their mind.

“There is evidence that clear labelling on drinks and beverages help consumers choose more wisely; this is effective particularly among those consumers who do care about having a healthier diet,” she adds.

That said, however, beyond driving a bit of awareness, no labelling in the world is going to deter a determined consumer from laying her hands on the drink she wants, says Ramesh Kumar, the head of strategy at M&C Saatchi Singapore.

With FMCG companies now unable to market these drinks with ads from next year, Mazumdur predicts they will start associating their brands with acceptable cultural categories like music, art, travel and sports.

He points to other controversial categories such as tobacco and alcohol, which has seen companies. For example, Bacardi previously told The Drum it sees its support of independent music act as a means of connecting with Indian consumers, particularly with ads for alcoholic beverages being banned in the nation.

“The other thing that’s likely to happen is that brands may engage influencers and consumers to generate user-generated content as then the brand itself would not be liable for promoting the product,” he adds.

Mark Hadfield, head of strategy for Iris in Asia Pacific says at its simplest, advertising serves the purpose to communicate a brand or a product message to its target audience.

This means that if a message cannot be directly communicated, then proxies are needed, which is where learnings from tobacco and alcohol can be useful.

“Be part of culture, don’t advertise: Brands now need to shift from bought media and traditional advertising into creating cultural assets people actually want to participate with. This could be online content, activations and happenings or participation platforms,” he explains to The Drum.

“They also need to be distinct and identifiable regardless where people experience you: The best brands have been planning this for years, and have unique and identifiable identifiers that can be used to shortcut associations and drive recognition.”

He continues: “Again, this is something alcohol brands have led with – Heineken’s red star, Absolut’s bottle shape or the black and white pint from Guinness. All examples that is identifiable due to consistency through the years.”

Chang agrees with Hadfield and adds: “Ads are just one promotional tool among a wide array of promotional tools that can be used to reach consumers and influence their preferences. If ads are banned but the other promotional tools are not, then it’s possible to switch to other tools (e.g., sales promotion, direct marketing, social media marketing).”

In Australia, the Queensland government has banned junk food advertising at government-owned sites as it seeks to curb obesity.

The ban will include more than 2,000 outdoor advertising spaces, including bus stops, train stations and roadside billboards and will include all leased advertising spaces owned by the state government.

Meanwhile, the UK government has begun a public consultation on proposals to ban junk food ads from appearing on digital platforms, like YouTube and Facebook, as well as TV.

It is the latest step from the Department of Health and Social Care (DHSC) in its attempts to curb the childhood obesity “epidemic”.

The consultation proposes that restrictions on social media and online streaming would be covered by the same 9pm watershed ban that it is seeking to impose on TV advertisers.

Further proposals include changing thresholds that allow foods to be advertised and placing time limits on junk food adverts.

Lobbying organisations like Action on Sugar and Action on Salt has called for a ban on on-pack cartoon animations on food that is high in sugar and salt to stop manufactures “deliberately manipulating” children and parents.

The groups also want to mandate ‘traffic light’ nutrition labelling, similar to the colour-coding labels Singapore wants to introduce, giving parents the chance to make healthier choices.

The Drum has reached out to the likes of Coca-Cola and Pepsi, but they have yet to respond at press time.

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