Merisant, the maker of Equal, attributes Splenda's overwhelming success to its marketing strategy that deliberately led consumers to view Splenda as a modified form of natural sugar. From 2000 to 2006, McNeil, the maker of Splenda, spent almost $235 million on marketing to position Splenda close to natural sugar and distance it from other artificial sweeteners.
According to Information Resources, Inc., Splenda had annual sales of $34 million in 2001, while Equal's sales totaled $84 million that year. In fact, reports show that sales of Splenda fell in 2002 when it added the line "but it's not sugar" to the main tagline. Sales shot back up after Splenda excluded that addition and returned to the original taglines "made like sugar, so it tastes like sugar" and "think sugar, say Splenda."
By 2004, increasing demand forced McNeil to ration shipments of Splenda in order to conserve its supply. In 2006, Splenda had sales of $212 million, whereas Equal had sales of $49 million. Since its appearance in 1999, Splenda has steadily overtaken Equal, and today it controls almost 62% of the $1.5 billion artificial-sweetener market.
Merisant and the Sugar Association have brought separate lawsuits against McNeil claiming that the marketing strategy of Splenda was deceptive and that the company capitalized on consumer confusion intentionally created by advertisements. The entire issue, to quote the March opinion of the court, boils down to "whether the phrase 'made from sugar' is merely 'misunderstood' or whether it was deliberately designed to be misunderstood and, hence, to mislead."
In July 2005, the New Zealand Advertising Standards Authority determined that a Splenda advertisement deceived consumers into thinking that Splenda was natural, like sugar. In August 2006, the Advertising Claims Bureau of Australia ruled that the ads were "likely to mislead or deceive consumers" since "reasonable members of the public viewing the advertisement are likely to conclude that a significant portion of the SPLENDA® products are comprised of a modified form of sugar."
Last week, the Commercial Court of Paris ruled that the Splenda ads were misleading and ordered the makers of Splenda to cease advertising claims infringing on French consumer-protection laws. The court in Paris also awarded Merisant payment for damages. Although we may never know what the outcome of the adjudication in the Pennsylvania court would have been, the fact that McNeil hurriedly settled with Merisant is indicative of the unpublished verdict.
The lawsuit brought against McNeil by the Sugar Association is still pending in California. As opined by Barbara Helms, who is vice president of an advertising firm in Philadelphia and who was a juror on the Pennsylvania case, McNeil did not necessarily set out to mislead, but neither did it do anything to stop the consumer confusion created by the Splenda ads.
The lesson to the advertising industry is that it is not sufficient to create a message that is technically correct; the consumer's understanding of that message needs to be periodically gauged as well. If potential for confusion is spotted, it is better to remove it than to risk being sued.
There is no doubt that "from sugar" and "like sugar" indicate in plain English that the substance they describe is not sugar, but the addition of "so" to indicate a causal connection in the message "made from sugar, so it tastes like sugar" could cue one to infer that the product is closer to sugar than other artificial alternatives.
