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RPF/JP 41& -/,, p,+. <',.....,;), ,4.--" .... . STRICTLY CONFIDENTIAL F16th July 1985 VISIT REPORT: DATE..~_SS: OBJECTIVES: ITL, CANADA 9TH-IOTH JULY 1985 (I) To critically review draft questionnaire design for Project VIKING (2) To participate in a one-day synectics session designed to generate (a) product perception attributes for use In the questionnaire and (b) novel alternative product concepts for use in an addltlonal concept testing phase of Project VIKING BACKGROUND = Project VIKING was initiated in early 1985 under the auspices of Wayne Knox, with broad objectives as follows: 1. To characterise the Canadian market with respect to smoking and health and social pressure attitudes and motivations. 2. To examine relative perceptions of product classes within the tobacco category (e.g. cigarettes, cigars, pipes, snuff, etc.). 3. To examine consumer perception of the tobacco product category relative to other product categories (e.g. food, alcoholic drink, personal accessories, etc.). 4. To evaluate potential consumer response to radical alternative presentations of the tobacco product. Implied in this approach is an attempt to provide a prognosis of the future Canadian tobacco market. Philosophically, the approach differs from the GR&DC LIBRA/ARIES/NARINERS work in two respects: • (I),, NARINERS is designed around the contention that, to fully understand the relationship between attitudes and behaviours in the marketplace (i.e. quitting and switching), it is necessary to monitor the same group of people across time. VIKING takes the alternative route of ustng a large population in a "single shot" model. (2) Whereas VIKING is essentially a prognostic indicator with an emphasis on seeking new product categories, NARINERS is aimed at developing more refined and predictive consumer segmentation models to improve share within a conventional cigarette marketing scenario. Prior to Wayne Knox joining Hardees, the agreed budget £or VIKING was in the order of 300,O00"Canadian Dollars. Bob Bexon now assumes executive responsibility for the project and t~e budgeE,.i.s still retained pending a feasibility review. ! r~o r~ r~j ClibPDF - v,vww.fastio.com

-2- OUTCOME OF CURRENT MEETING i. QUESTIONNAIRE DBSIGN The first draft questionnaire for VIKING has been produced by The Creative Research Group of Toronto, with input from a previous VIKING meeting (February 1985) and a series of consumer qualitative group sessions. This draft was reviewed (RPF) and the following observations have been made: (a) (b) The questionnaire is too long (approximately Z-hour administration time) and alternative means of administration will have to be explored (including repeat visit and postal returns). In current form, the questionnaire fails to cover several of the issues originally identified as important to measure. This problem can be resolved by building out to a questionnaire size unconstrained by timing issues, and then reducing by eliminating redundant measures and non-discriminating or merely descriptive status items. (c) The inclusion of two lengthy personality inventories was questioned since one questionnaire (EPI) is designed to measure a factor already measured within the other questionnaire (16 P-F). It was advised to use only the 16 P-F and as a postal return measure. 2. SYNECTICS SESSION This synectics (brain storming) group comprised the following individuals: BOB BEXON (ITL, Montreal) DICK CROSBY (Retired President of Canadian Facts) ROB FERRIS (BAT Marketing Support) PETER ILLYCH (ITL, Montreal) BILL SANDERS (ITL, Montreal) PAUL NESBITT (Creative Research Group, Toronto) The first half of the one-day session was devoted to developing the product perception component of the VIKING questionnaire. This involved the generation of judgemental dimensions which may be used to achieve (a) a perceptual mapping of tobacco product classes relative to one another and (b) a similar mapping of tobacco products usage relative to uses of products from other classes (food, drink, etc.). Following this construct generation stage, the group was used to generate new alternative product concepts. The aim ~as to'identify'six concepts which will be incorporated into a concept reaction t~st within VIKING. The test itself is of Considerable interest since it'represents a form of simulated test market (STM) methodology, an approach currently being evaluated (RPF) for its potential utility to the BAT Group. 0 P~ P~ r~ ClibPDF - www.fastio.com

Briefly, the new product concepts generated were segregated into those showing most promise and those having less promise: MOST PROMISING l, EXTRUDEDS: Th~s covers a collection of presentations ranging from snack food type shapes and packaging through chewing sticks to reel dispensers or toothpaste tube type dispensers. In each case the notion of individua] control over how much of the material to break off and use is paramount. Q DRY SNUFF: Perhaps the most clearly endorsed concept of all, this product would be presented bleached white and probably in an inert carrier, formulated to eliminate the sneeze reflex and marketed in high imagery/quality containers. . MODULAR SMOKE DELIVERY SYSTEM: This. concept would be a smoking device somewhat similar to a pipe into which the basic fuel could be mounted for combustion. Modular "clip-on" mouthpieces could be used to provide such smoker control options as "dial-a-tar" or "dial-a-flavour". . PIPE PLUGS: For the pipe smoker, this concept would be a pre-formed, pre-tamped, drop-in tobacco plug designed tD fit the appropriate pipe bowl and sufficiently contained within the plug to allow subsequent lifting out of the spent unit. LESS PROMISING . AEROSOL DISPERSION DEVICES: The concept covers personal mobile inhalers in combination with nicotine dispersing air humidifier/ freshener units which could be used in controlled social situations. . IMPROVED SMALL CIGARS AND AROMATIC CIGARETTES: The use of blending/ flavouring to ameliorate harshness/dryness and enhance flavour/aroma of small cigars was seen as worthwhile. In addition, the use of pipe grades or pipe tobacco flavours (e.g. vanillin) to enhance conventional cigarette sidestream was endorsed. DISCUSSED AND REJECTED 7. NICOTINE ADDITIVES TO FOOD PRODUCTS , SHORT "FAST HIGH" CIGARETTES: I.e. cigarettes designed to provide optimum nicotine requirement in the minimum number of combusted puffs. In addition to these ideas, strong interest was shown in the identification of "safer" tobaccos, re~ions, design configurations and synthetic smoking materials. (RPF was requested to supply a retrosPective~review of the NSM experience in the UK,). c~ r~j r~J ~r~ .,c) r~ ClibPDF - wvvvv.fastio.com

-4- OBSERVATIONS Without substantial revision of the VIKING questionnaire, this project is unlikely to proceed (and it would be ill-advised to do so). The agency involved was clearly so negatively impressed by the overwhelmingly anti- smoking feeling coming from the consumer qualitatives that they themselves are concerned about taking the project further. It is suggested (RPF) that, with adequate questionnaire design, the project is important and viable. The agency response to the consumer group qualitatives reflects lack of experience with this type of data - such groups are invariably extreme, representing, as they do, consumers' theories about what their attitudes should be rather than their true in-depth attitudes. The "re-surfaclng" of a concern for generating new product concepts is interesting in the context of the R&D/Marketing conference experience. Some overlap of concepts is apparent across the two sessions; the interesting development here, however, is the commitment to moving on to evaluate the concepts using the VIKING consumer population. In terms of possible "knock-on" project work for GR&DC, the scope for input is very high, given past recent history of exploring these new avenues. While Southampton-based interest in these concepts must be highly circum- spect, given the confidential nature of VIKING, a potential feasibility response timed to follow VIKING consumer response to these concepts may be useful. This could be especially so for items 1, 2 and 5 since these were Southampton contributions to this synectics session. R.P. FERRIS ClibPDF - www.fasti0.com I 0 r,o 11,,,0 I',o "--d

Author: R. Binns RB/JMP VISIT OF DR. RICHARD BINNS TO THE TECHNICAL CENTRE, ITL, CANADA AND R,D & E, BROWN AND WILLIAMSON 23rd to 27th January, 1984 16th February, 1984 ~lll~jl 2 0 F.E B 1984 RPF _~,r.. ............... WDEI CCG ...... : CRI ..-.--.~] A~ My previous visits to these laboratories had been in connection with biological research. This was my first opportunity to see the technical support facilities and to discuss such work in detail. ITL CANADA The laboratory in Montreal is strongly orientated towards support for plant operations {brand monitoring, plant monitoring, materials testing, etc.,) and product development. Large amounts of relatively routine work are carried out and the laboratories appear to be adequately staffed and equipped for this. As a consequence of this concentration on technical _ support, relatively little work is possible on longer term, research activities. PRODUCT MONITORING Brand analysis and physical testing of cigarettes are carried out on roughly the same scale as in GR&DC. Turnround time for reporting is up to 7 weeks c.f. an average of just over 2 in Southampton. Problems associated with establishing the laboratory automation system presumably contribute to this. Much of the data preparation and reporting is currently done by hand. One objective should be to integrate and automate both data collection in the laboratory and the production of reports for 'customers'. PHYSICAL TESTING OF CIGARETTES As we do, ITL experience problems with the assessment of coal fall-out characteristics because the device used at present is very difflcult to adjust. Details of the micro- adjuster developed at GR&DC will be sent to Canada if it proves successful. LABORATORY AUTOMATION It is disappointing that Canada has chosen to adopt a different approach-to the proven modular concept working in CAL. Use of a central computer (BPI000), rather=than micros, contracting the work to a 'distant' consultant ~nd lack of awareness of the problems at B&W have combined to produce a difficult and costly technical project. ~o CO ClibPDF - v'dwvv.fastio.col]]

4& -- 2 - TRIACETIN IN FILTER RODS An improved yersion of this machine has been developed by Gatan Levert. The automated system gives a value for triacetin level in filter rods after a 5 minute extraction and IR analysis. This model is ready for routine use and presumably supersedes the GR&DC experimental model reported in 1982. Estimated cost $12,000. PROPOSED MEETING ON LABORATORY METHODS Interest from ITL centred on those topics which could be obviously related to the operational needs of the Canadian company. Thus, topics such as robotics, laboratory automation and improved autoanalyser systems were supported as being of considerable interest. Less immediate need was seen for information or discussion on topics such as sidestream monitoring or ambient monitoring. Nevertheless there was a perceived need for research on these issues and for ITL to have an up-to-date awareness of work in progress. ., ...~ .'°., ~ o ° bO ~O ClibPDF-www.fastio.com

.& -- 3 -- B & W LOUISVILLE Compared with previously, there was a greater openness about this visit to B & W and a clear sense that staff in the laboratory identified their work with the company's needs. PRODUCT MONITORING Brand analysis, physical testing and materials testing are carried out as at GR&DC. For determination of tar deliveries, dlsposable Gelman holders are used on a routine basis. These are leak tested prior to use and a 3% rejection rate is typical. In the laboratory, some changes, e.g. to smoke hoods, have been introduced since HFDD's visit last year. PHYSICAL TESTING OF CIGARETTES The Rhodia (Borgwaldt) hot collapse monitor was being evaluated by Dr. Geiss. He will advise us of his conclusions about the instrument after completlng his evaluation. A new coal fall-out method may be developed by Mr. Tucker, to overcome the problems associated with the current device used for doing this measurement. In the prototype, by means of a solenoid valve, a 9g weight is repeatedly dropped on to an individual cigarette. Coal fall-out, as the cigarette is being smoked, is sensed and accurately timed by using a he~t detector. ROBOTICS B & W are investigating the use of a robot arm for routine weighing procedures in the smoke laboratory. It is known that PM and RJR already have robots in place for such work. The PM system, reported in various publications, uses a relatively large industrial arm costing $40,000. The GR&DC project is aimed at carrying out essentially the same procedures, but with much more modest investment. All BAT companies will be informed of the progress of the GR&DC robot project. LABORATORY AUTOMATION B & W have a laboratory automation system similar to the one in Canada i.e., Hewlett Packard based. In addition to the HPI000 computer, the system also has a PDP-II mini-computer. Various terminals around the laboratories are connected to the system which is dependent on the central computer. The laboratory automation system seems has a certain rigidity, which makes non-routine laboratory work difficult. For example, daily work" programmes fo~ the var-lous "laboratories are set up by the computing staff, based upon requests for analysis received and the priority rating assigned to them. C ~c ~c C ClibPDF - V'd\,V\,V.fastio.coR1

To improve the present system, the central computer will be replaced by ~ bigger machine, to be complemented by three HPIO00 computers and appropriate laboratory peripherals. (Total cost approximately $900,000). SIDESTREAM Some work is in progress on sidestream monitoring, using a version of the 'fishtail' chimney developed at GR&DC. The most up-to-date details of this device, together with a actual example, should be sent to Hugh Honeycutt. Considering the importance of the exact dimensions of the device, as far as delivery determinations are concerned, it will be worthwhile providing B & W with an an example of the finalised version of the 'fishtail'. LABORATORY CROSS CHECKS For Project Colonel (monitoring of B & W international brands) the licensee produces data from the operating company laboratory for checking at B & W. In addition, standard samples are also sent from Louisville in order to cross-check the reliability of this laboratory data. Gil Esterle sees the GR&DC inter-laboratory collaborative study an effective means of monitoring laboratories and an additional cross check of their performance. B & W (through Gil Esterle) would wish to be informed of any changes in th2 laboratory cross-check protocol. An information sheet on smoking standards required by different countries would be useful information for the international brand work done by Gil Esterle and Paul Aulbach. PROPOSED MEETING ON LABORATORY METHODS There was strong support for such a meeting from both John Lauterbach and Jim Nall. This is, in part, due to the fact that both are responsible and very actively involved in the development, transfer and auditing of chemical methods for use in the laboratory at the Macon factory. The degree of interest shown was emphasised by the suggestions for many additional topics for discussion at such a meeting. Mainly, these concerned various methods which are correctly seen as semi-routlne, but in response to future needs are likely to be required for regular routine product monitoring (techniques for flavour monitoring, blend composition, gas phase analysis, etc.). ~O kO L,4 ClibPDF - www.fastio.con]

- 5 - The visits to the two laboratories were extremely useful. In both, the work is most obviously related to the requirements of the individual companies. Timescales tend to be shorter and projects more sharply focussed on a specific problem. Against this background, the value of the R & D role for Southampton is clear, as is the quality of the facilities and, more important, the staff to do this job. DISTRIBUTION Dr. L.C.F. Blackman Mr. A.L. Heard Dr. C.I. Ayres Dr. M.J. Hardwick CC m Mr. H.F. Dymond Mr. D.B. Mullen Mr. R.W. Hedge/ Dr. T. Hirji V Dr. R.G. Hook Mr. J.A. Luke Dr. G. Smith Mr. G.A. Read Dr. R.A. Crellin I f i O ~uD ~O ClibPDF - v'dv'Jvv.fastio.col]]