Brand loyalty starts from a very early age

Children’s spending power is booming. Marketing consultant Martin Lindstrom estimates children’s global purchase influence to be $1.88 trillion (£1.29 trillion). Moreover, young people are often seen as early adopters for many digital and direct media technologies, according to last year’s Buckingham Report on the commercial world and children.

Direct marketers that properly research and execute work targeting children and families may well be able to build future brand loyalty among young people. The Buckingham Report indicates that children exert a lot of influence on their parents’ purchasing activity as well as being consumers in their own right.

And companies that spend time and money influencing children at a young age could see them retain their custom in the future.

But despite all the potential, this is a thorny area for marketers. While not much legislation exists to regulate brands that market exclusively to children, this sector demands that marketers treat this vulnerable demographic in an ethical and responsible way. Any “inappropriate” transgressions end in consumer backlash, as retailer Primark discovered in April when it tried to sell a padded bikini range for seven-year-olds.

Earlier this year, Conservative Party leader David Cameron warned marketers, advertisers and shops to “show more restraint in the way they operate” when marketing to children or face further regulation. Before he became Prime Minister, Cameron expressed concern that children were being “treated like adults”, adding: “It’s high time the children’s market and advertisers show much more restraint in the way they operate. We don’t want to resort to regulation, but we will make it clear that if business doesn’t exercise some corporate responsibility, we will not be afraid to impose it.”

Marketers have responded quickly to this threat. Social networking site Facebook, to which users can sign up from the age of 13, is used by many brands for direct marketing activity. The website announced last month that it would be introducing simpler and more powerful controls for sharing personal information, in response to user concerns about privacy.

According to Facebook founder and CEO Mark Zuckerberg, these changes will include Facebook not sharing personal information with people or services that users don’t want, not giving access to personal information and not selling that information to third parties.

Jules Polonetsky, director of the Future of Privacy Forum, cautions: “The message that all companies should be taking on board is that managing their digital identity is critically important to internet users of all ages and backgrounds. As sites, services and devices grow increasingly complex, the challenge for Facebook and others is to continue to seek innovations that ensure that privacy tools can be intuitive for users.”

Caroline Roberts, director of public affairs at the Direct Marketing Association (DMA), advises that the Data Protection Act fails to mention children and that marketing to this demographic is fine, as long as brands go about it in the right way.

“It’s perfectly legitimate marketing to children of all ages, provided it’s suitable. It’s knowing what’s appropriate and making sure that you are getting proper parental consent where you need to,” she explains.

Yet to optimise their success rates in the family sector, many direct marketers focus their efforts on parents, who still exercise considerable control over the purchases their children make.

Ed Relf Chief marketing officer, Mind Candy

Moshi Monsters, our virtual world and online game where children can adopt and care for their own pet monster, has been live for about 15 months. We have about 20 million registered players around the world and the game is growing at a rate of about 2 million new players every month.

We don’t do any DM to children under 13, it’s all channelled to parents. If you’re under the age of 13, then your parents need to sign up to the game for you. By its very nature and the fact that you have to be over the age of 13 to play, we need parental endorsement. As a result, we focus on parents in terms of DM because they are essentially the gatekeeper to that child being able to play on a computer.

Our current global marketing push is the Hey Moshi campaign, where we licensed a music track from Universal and built that into a comprehensive campaign. When you go to the Heymoshi.com website, you can hear the track with accompanying music video.

The pay-off was that through a TV campaign, we brought the children and parents to Heymoshi.com. Over the summer, we’re going to take that to the next level and invite children to record themselves doing the Hey Moshi dance, and then those videos – with parental consent – will be featured in all our above-the-line marketing. A key thing for us in terms of our DM campaigns is re-engagement of our existing audience.

We’re also starting to trial physical direct mail. We targeted 5,000 families – with PCs at home, broadband and children within our target demographic – with a piece of direct mail, which included two three-day membership cards to Moshi Monsters.

We’ve found that perceived value is extremely important for physical direct mail.

Nobody in our space, within the online games business, is really looking at those areas at the moment. The new and innovative channels are more targeted towards children because that’s what’s going to drive engagement and get them talking about the product at school, but it’s the more traditional channels that we’re using when it comes to targeting parents.