New York, NY – March 26, 2012  – The Children’s Advertising Review Unit of the (CARU) has recommended Mattel, Inc., modify the website Shop.mattel.com, to better protect children’s privacy.

The Shop.mattel.com website came to the attention of CARU through CARU’s routine monitoring practices. CARU reviews websites to assure compliance with CARU’s Self-Regulatory Program for Children’s Advertising, including guidelines on Online Privacy Protection, as well as with the federal Children’s Online Privacy Protection Act (COPPA).

CARU was directed to the site from www.Barbie.com, a Mattel-operated website for children. The homepage of www.Barbie.com featured a series of links to games, videos, and a virtual world. At the bottom of the homepage, a section labeled, “Grown-Ups” featured the following buttons: “Barbie Collector,” “Shop for Toys,” and “Like Barbie.”

Upon CARU’s initial visit to the site, clicking the “Shop” link brought visitors to the Barbie Boutique area on the Mattel.com website.

The Barbie Boutique page was highlighted in hot pink with a large image of Barbie, surrounded by images of Barbie-related products, including such categories as playsets and accessories, dolls, lifestyle, beauty, and Barbie, Styled by Me.

At the top of this page was a rotating banner.  One promotion read: “Toy-A-Day Giveaway:  Enter for your chance to win Today’s Prize and a $500 shopping spree! Click here for details.”

If a user clicked on the link, an entry form popped up.  To enter a visitor had to enter a first name, last name, email address, and street address. At the bottom is a checkbox that stated, “I verify that I am 18 years old.”

CARU was concerned that the company, on the Toy-A-Day Giveaway promotion form, collected personally identifiable information (PII) from visitors under 13 without prior verifiable parental consent contrary to COPPA and the guidelines.

In response to CARU’s initial inquiry, the website operator asserted that the Toy-A-Day promotion was located on the adult-directed e-commerce site. The company argued that the site was not child-directed or child-friendly in format and presentation, as one would be challenged to navigate the site effectively without being a proficient reader.  Further, the company said, the site primarily displayed products in a matter-of-fact grid format and provided no child-directed content.

CARU’s guidelines for Online Privacy Protection provide that where there is a reasonable expectation that a significant number of children will be visiting a website, the operator should employ age-screening mechanisms before collecting personally identifiable information (PII), to identify children under the age of 13 and either obtain verifiable parental consent or block younger users.

In this case, CARU had to determine whether an e-commerce website, which featured a sweepstakes promotion, had a “reasonable expectation” that a significant number of children would be visiting its site.

After reviewing the Website and all of the evidence on the record, CARU determined that the operator had a reasonable expectation that a significant number of children would be visiting its Mattel.com website and should have employed a neutral age-screening mechanism before collecting PII to determine whether children under the age of 13 were entering the Toy-A-Day sweepstakes promotion.

In its operator’s statement, Mattel said that while it “respectfully disagrees with CARU’s decision, the sweepstakes has ended and Mattel supports the self-regulatory process.  Mattel will take CARU’s views into account in future sweepstakes.”

CARU’s inquiry was conducted under NAD/CARU/NARB Procedures for the Voluntary Self-Regulation of National Advertising.  Details of the initial inquiry, CARU’s decision, and the advertiser’s response will be included in the next NAD/CARU Case Report.

About Advertising Industry Self-Regulation: The National Advertising Review Council (NARC) was formed in 1971. NARC establishes the policies and procedures for the National Advertising Division (NAD) of the Council of Better Business Bureaus, the CBBB’s Children’s Advertising Review Unit (CARU), the National Advertising Review Board (NARB) and the Electronic Retailing Self-Regulation Program (ERSP).

The NARC Board of Directors is composed of representatives of the American Advertising Federation, Inc. (AAF), American Association of Advertising Agencies, Inc., (AAAA), the Association of National Advertisers, Inc. (ANA), Council of Better Business Bureaus, Inc. (CBBB), Direct Marketing Association (DMA), Electronic Retailing Association (ERA) and Interactive Advertising Bureau (IAB).  Its purpose is to foster truth and accuracy in national advertising through voluntary self-regulation.

NAD, CARU, and ERSP are the investigative arms of the advertising industry’s voluntary self-regulation program. Their casework results from competitive challenges from other advertisers, and also from self-monitoring traditional and new media. NARB, the appeals body, is a peer group from which ad-hoc panels are selected to adjudicate NAD/CARU cases that are not resolved at the NAD/CARU level. This unique, self-regulatory system is funded entirely by the business community; CARU is financed by the children’s advertising industry, while NAD/NARC/NARB’s primary source of funding is derived from membership fees paid to the CBBB. ERSP’s funding is derived from membership in the Electronic Retailing Association. For more information about advertising industry self-regulation, please visit www.narcpartners.org.