When the going gets weird, the weird turn pro. - Hunter S. Thompson

26 June 2009

Why Philip Morris loves the new tobacco regulations

When Senator John McCain introduced FDA regulatory legislation in 1998, the company spent a reported $100 million successfully fighting it. But since then, Philip Morris has had a crucial realization. With 50% of the U.S. tobacco market already safely in the company's pocket — and more than 50% of 18- to 25-year-old smokers loyal to its top brand, Marlboro — restrictive legislation will effectively lock in its market dominance, preventing any competitors from taking a bite out of Philip Morris' very lucrative business.

The company's main rival, R.J. Reynolds, manufacturer of Camel cigarettes, is still in dismay over Philip Morris' reversal from regulation opponent to champion, and the third largest cigarette manufacturer, Lorillard, has labeled the legislation the Marlboro Monopoly Act. Both argue that as the new restrictions cut off most remaining avenues available for advertising and ban marketing stunts like free-sample cigarette giveaways, the companies' ability to "communicate" (i.e., gain market share) with potential and existing smokers about their products will be blocked. In addition, the administrative costs of complying with FDA regulations favor large manufacturers over smaller ones.

Smoke Signals: Why a Tobacco Giant Is Backing a New Anti-Smoking Bill (Time.com)

Related: See vintage cigarette propaganda

Oh, by the way - I quit smoking exactly one week ago today. ;-)

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