Advertising watchdog group Truth in Advertising (TINA.org) and the University of Connecticut Rudd Center for Food Policy & Health filed a complaint with federal agencies today against energy drink maker GHOST, alleging the company has “unfairly and deceptively” marketed its products to children.
The complaint, submitted to the U.S. Food & Drug Administration (FDA) and the Federal Trade Commission (FTC), alleges advertising and the labeling for GHOST’s ready-to-drink and powered beverages either appeals directly to minors or blurs the lines between adult and kids products, particularly through the brand’s use of licensed candy flavors.
Founded in 2016 as a lifestyle nutrition brand, GHOST launched its ready-to-drink energy line in 2020 and has quickly become one of the fastest growing brands in the category, backed by a distribution agreement with Anheuser-Busch InBev. The brand has made a mark with its licensed candy flavors, including Mondelez International-owned brands like Sour Patch Kids and Swedish Fish, as well as Impact Confections’ Warheads, and has also established itself within the online gaming community through influencer marketing and official partnership with esports team FaZe Clan.
But according to TINA and the Rudd Center, the candy flavors may constitute child-friendly marketing, and suggested the lines between adult and children’s marketing are blurred “by the fact that Mondelez International integrates the marketing of Ghost products with its candies on its own social media channels … with no disclosure that the products are not appropriate for minors.”
“Numerous studies have documented the powerful impact marketing has on children’s consumption, preferences, and purchase requests,” said Fran Fleming-Milici, Rudd Center’s director of marketing initiatives, in a press release. “Pairing candy logos that have clear child-appeal with a product that harms children’s health is an egregious display of putting profit over common sense and the well-being of children.”
The complaint also cites GHOST’s partnerships with social media influencers with significant adolescent audiences, such as FaZe Clan among others, and “unsubstantiated and unapproved” health claims suggesting the products provide “epic focus” and help with “anxiety.” As well, the watchdog groups stated that the brand has sponsored various youth sports organizations and previously provided free products to a high school football team featuring freshman and sophomore players.
Although GHOST’s powders and energy drinks – which feature 200 mg of caffeine per 16 oz. can – do feature a disclaimer cautioning that the products are only intended for “healthy adults,” TINA and the Rudd Center claimed the warning is “illegible fine print” that doesn’t sufficiently offset the brand’s appeal to minors.
Speaking to BevNET, Fleming-Milici acknowledged that although candy flavors may have a nostalgic draw for adult consumers, and that there are video games that have both adult and youth audiences, they still appeal heavily to children and said the company needs to consider the potential consequences and take action to instate labeling and marketing guidelines to ensure they’re keeping the messaging away from kids.
“It doesn’t really matter what the intention of the company is, it’s what the perception is of the consumer,” she said. “The people who make these products need to think a little more about safety when they’re creating them, marketing them, and labeling them.”
According to TINA legal director Laura Smith, the filing is the culmination of a lengthy investigation into the brand. TINA and the Rudd Center initially sent a warning letter to GHOST’s founders, as well as Mondelez and Impact Confections, on December 2 but did not receive a response. After ten days with no reply, the groups forwarded the complaint to the FDA and FTC this morning for the agencies’ consideration to investigate.
GHOST isn’t the only energy brand TINA and the Rudd Center have reached out to about problematic marketing, Smith said. The nonprofit sent an additional 37 letters to companies representing 43 different energy brands today alerting them of similar concerns around child-friendly marketing.
Smith said the issues at these other companies varied, but were broadly similar to GHOST. They include brands using licensed flavors, such as RYSE Fuel – an energy drink with flavors like Kool-Aid, Sunny D, Ring Pop and Smarties – as well as companies making specific function or health claims, such as Nutrabolt’s C4 whose Smart Energy line has been referred to as a “study aid,” she said.
Energy drink brands have been a frequent source of controversy over marketing to minors, including 2013 congressional hearings when representatives from Red Bull North America, Monster Energy, and Rockstar testified before the Senate, leading to an agreement by the brands to take more caution in their marketing.
Reached by BevNET, GHOST co-founder and CEO Daniel Lourenco said he was unaware of the complaint and declined to comment until he could learn more.
Last week, Lourenco briefly discussed the issue of child friendly marketing during an on stage interview at BevNET Live Winter 2022. Asked about the issue then, he said keeping the products out of kids’ hands is a concern for the company and an issue it takes seriously. GHOST was initially sold primarily in stores like GNC and Vitamin Shoppe, which helped the company avoid underage consumers. But as it expands into mainstream outlets like grocery and convenience stores, he said responsible marketing is a priority for the brand.
“We have very tight and responsible marketing and content policies, and Mondelez takes that seriously and GHOST takes that seriously,” he said during the interview. “I think the other side of it though … [is] we didn’t create candy flavors [in energy drinks]. You have [C4’s] Sour Patch Bros, [Bang Energy’s] Sour Heads, Lemon Head, Star Blast – this or that – we’re just adding authenticity to it. Sometimes the best innovation is in inches not miles, and you have to be very careful where and how you market no matter what the flavor of the product is. But I think by taking it seriously, being careful and continuing to check all the boxes we’ll be fine.”