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RJ Reynolds

1975 (750000) Marketing Plans Presentation Hilton Head September 30, 1974 (750930).

Date: 30 Sep 1974
Length: 26 pages
501477369-501477394
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Fields

Named Person
Sports Illustrated
Playboy
Ms
Road & Track
Motorcycling
Nascar
Rucheck
Blass, W.
Lauren, R.
Klein, C.
Bloomingdale
Filene
I Magnin
Sanka
Wells, R.
B&W
Philip Morris
Rjr
Type
MARKETING PLAN
Site
Executive
Request
19960800
1rfp95
1rfp96
1rfp97
1rfp101
1rfp102
Minnesota
1rfp93
Texas
Court
Order
19970811
Mangini
Box
Rjr3148
Date Loaded
27 Feb 1998
Attachment
7298 -7464
Brand
Real
Multi Brands
Other Brands
UCSF Legacy ID
jty39d00

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Page 1: jty39d00
1975 MARKETING PLANS PRESENTATION HILTON HEAD SEPTEMBER 30, 1974 CHART #1 , OUR PARAMOUNT MARKETING OBJECTIVE IN 1975'AND OBJECTIVE IN 1975 ENSUING YEARS IS TO REESTABLISH RJR'S SHARE OF MARKETING GROWTH IN THE DOMESTIC CIGARETTE INDUSTRY, CHART #2 WE WILL SPEAK TO FOUR KEY OPPORTUNITY AREAS TO r OPPORTUNITY AREAS ACCOMPLISH THIS, THEY ARE: 1- INCREASE OUR YOUNG ADULT FRANCHISE, 2- IMPROVE OUR METRO MARKET SHARE, EXPLOIT THE POTENTIAL OF THE GROWING CIGARETTE CATEGORIES, 4- DEVELOP NEW BRANDS AND LINE EXTENSIONS WITH NEW PRODUCT BENEFITS OR NEW PERSONALITIES, FIRST. LET'S LOOK AT THE GROWING IMPORTANCE OF THE YOUNG ADULT IN THE CIGARETTE MARKET, IN 1960, THIS YOUNG ADULT MARKET, THE 14-24 AGE GROUP REPRESENTED 21% OF THE POPULATION, "- o r 0 CHART #3 AS SEEN BY THIS CHART. THEY WILL REPRESENT 27% ~ w YOUNG POPULATION OF THE POPULATION IN 1975. THEY REPRESENT 10 SKEW TOMORROW'S CIGARETTE BUSINESS. AS THIS 14-24 AGE GROUP MATURES, THEY WILL ACCOUNT FOR A KEY SHARE OF THE TOTAL CIGARETTE VOLUME -- FOR AT LEAST THE NEXT 25 YEARS,
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BOTH PHILIP MORRIS AND BROWN & WILLIAMSON, AND P.M. & B&W SHARE BY AGE PARTICULARLY THEIR FAST GROWING MAJOR BRANDS, MARLBORO AND KOOL. HAVE SHOWN UNUSUAL STRENGTH AMONG THESE YOUNGER SMOKERS. IN THE 14-24'AGE CATEGORY, PHILIP MORRIS HAS A 38% SHARE AND B&W A 21% SHARE. BOTH COMPANIES HAVE SIGNIFICANTLY LOWER SHARES IN THE REMAINING AGE CATEGORIES. WITH STRONG YOUNG ADULT FRANCHISES AND HIGH CIGARETTE BRAND LOYALTIES, THIS SUGGESTS CONTINUED GROWTH FOR PHILIP MORRIS AND B&W AS THEIR SMOKERS MATURE*. ~(RT-#5 IN SHARP CONTRAST, OUR COMPANY LINE SHOWS A P.M., B&W, & RJR SHARE BY AGE AT#6 PATTERN OF RELATIVELY EVEN STRENGTH AMONG ALL AGE GROUPS AND STRENGTH IN THE 25 AND OLDER CATEGORIES, WHERE WE EXCEED BOTH COMPETITORS. OUR TWO MAJOR BRANDS, WINSTON AND SALEM, SHOW SHARE BY AGE WINSTON & SALEM VS. MARLBORO $ KOOL COMPARATIVE WEAKNESS AGAINST MARLBORO AND KOOL AMONG THESE YOUNGER SMOKERS. WINSTON IS AT 14% IN THE 14-24 AGE GROUP VERSUS MARLBORO AT 33X. SALEM IS AT 9% VERSUS KOOL AT 17%. AGAIN, OUR BRANDS SHOW COMPETITIVE STRENGTH IN THE 25 AND OLDER AGE GROUPS, , THIS SUGGESTS SLOW MARKET SHARE EROSION FOR US IN THE YEARS TO COME UNLESS THE SITUATION IS ~ ~~. CORRECTED, 0 .. ~ ~
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SHARI#Z STRATEGY THUS. OUR STRATEGY BECOMES CLEAR FOR OUR ESTABLISHED BRANDS: 1- DIRECT ADVERTISING APPEAL TO THE : YOUNGER SMOKERS WHILE ~• 2- BEING TRUE TO THE BRAND'S BASIC PRODUCT ATTRIBUTES (E,G., TASTE FOR WINSTON. REFRESHMENT FOR SALEM) AND 3- WITHOUT ALIENATING THE BRAND'S CURREIff FRANCHISE. 11 CHART #8 FOR WINSTON, WE'VE FOLLOWED THIS STRATEGY IN NEW WINSTON AD DEVELOPING THE NEW uCANDID" ADVERTISING CAMPAIGN CAMPAIGN WHICH BROKE SEPTEMBER 16. IT IS ESPECIALLY DESIGNEI TO APPEAL TO YOUNG ADULTS WITH: • SIMPLE STRAIGHTFORWARD COPY • BELIEVABLE PEOPLE WITH CHARACTER • STRONG PRODUCT SELL WITH REAL TASTE EMPHASIS RESEARCH HAS SHOWN THAT AMONG YOUNG ADULTS, THE NEW WINSTON ADS GENERATE TWICE AS MUCH RECALL AS ANY PREVIOUS WINSTON CAMPAIGN AND ARE 40% MORE PERSUASIVE COMPARED TO THE MARLBORO CAMPAIGN. CHART #9 FOR SALEM, SIGNIFICANT IMPROVEMENTS HAVE BEEN SALEM IMPROVED MADE IN THE ADVERTISING, DESIGNED FOR MORE YOUNG AD CAMPAIGN ADULT APPEAL UNDER ITS GREENERY/REFRESHMENT THEME.
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THESE INCLUDE: • MORE TRUE-TO-LIFE YOUNG ADULT SITUATIONS, • MORE DOMINANT MALE VISUALS, -, • A GREATER SPIRIT OF FUN; • GREATER USE OF WATER AS A REFRESHMENT SYMBOL, RESEARCH HAS SHOWN THESE CHANGES HAVE MEASURABLY IMPROVED THE ADS IN TERMS OF: r . GREATER RECALL • GREATER REFRESHMENT PLAYBACK • MORE YOUNG ADULT APPEAL - TRIAL HAS INCREASED FROM 24% TO 31% IN THE UNDER 35 AGE GROUP FOR THE KING SIZE. EFFORTS TO IDENTIFY AN EVEN STRONGER CAMPAIGN ARE BEING AGGRESSIVELY PURSUED BY TWO ADVERTISING AGENCIES AND AT LEAST ONE NEW CAMPAIGN IS ANTICIPATED TO BE MARKET TESTED IN EARLY 1975. ACH RT 10 FURTHER YOUNG ADULT EMPHASIS IS BEING PLACED SALEM BOX THROUGH THE SUCCESSFUL SALEM BOX "DENIM" CAMPAIGN. ADVERTISING RESEARCH HAS SHOWN: • SALEM BOX PROFILE IS YOUNGER WITH 57% OF ~ 0 CHABI_#.11 CAMEL F I LTER ADVERTISING USERS IN THE 18-34 AGE GROUP VERSUS 41% J FOR SALEM KING, w 4 N CAMEL FILTER CONTINUES TO SHOW VITALITY IN THE MARKET. GROWING ABOUT 50% FASTER THAN THE INDUSTRY - UNDER ITS CURRENT "NOT FOR EVERYBODY" CAMPAIGN.
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• ADVERTISING AWARENESS HAS INCREASED AMONG PRIME PROSPECTS -- YOUNG ADULT MALES, • FAVORABLE CONSUMER ATTITUDES TOWARD THE BRANDS HAVE INCREASED. ' • THE BRAND HAS INCREASED ITS SHARE PENETRATION AMONG THE KEY 18-24 MALE AGE GROUP -- FROM 1.8 TO 2,1% -- A 16% INCREASE. CHART #12 STARTING IN JULY 1974. A NEW MARKETING PROGRAM NEW PROGRAM WAS PUT INTO TEST MARKET -- TARGETED AT YOUNG FOR CAMEL FILTER ADULTS AND DESIGNED TO BE EVEN MORE COMPETITIVE AGAINST MARLBORO IN TERMS OF: • NEW "MEET THE TURK" ADVERTISING CAMPAIGN. • NEW MARLBORO-LIKE BLEND IN THE PRODUCT. • SIGNIFICANTLY INCREASED AD SPENDING, 3 ALSO A NEW PACKAGE DESIGN WITH STRONGER YOUNG ADULT MALE APPEAL IS BEING DEVELOPED AND WILL BE TESTED IN EARLY 1975. WE RECOGNIZE "MEET THE TURK" HAS POTENTIAL PROBLEMS DUE TO THE GREEK-TURKISH WAR. A BACK-UP CAMPAIGN IS BEING DEVELOPED IN THE EVENT THIS BECOMES A SERIOUS PROBLEM, VANTAGE WITH ITS FAST GROWTH RATE COULD BE OUR VANTAGE WINSTON OF TOMORROW, UNLIKE THE TRADITIONAL PATTERN OF OTHER LOW TAR AND NICOTINE BRANDS, VANTAGE HAS SHOWN THE ABILITY TO ATTRACT:
Page 6: jty39d00
• SIGNIFICANT NUMBERS OF NORMAL FLAVOR FILTER SMOKERS. ALMOST 50% OF THE BRAND'S NEW BUSINESS COMES FROM NORMAL FLAVOR FILTER SMOKERS COMPARED TO ONLY 20% FOR OTHER " LOW TAR AND NICOTINE BRANDS, • NEW AND YOUNGER SMOKERS. FIELD SALES REPORTS VANTAGE HAS POCKETS OF STRENGTH ON COLLEGE CAMPUSES (E.G., IN THE BOOK . STORE AT HARVARD SQUARE, VANTAGE IS AMONG THE TOP 10 SELLERS, 15TH NATIONALLY). CHAR # 4 MEDIA AD SPENDING HAS BEEN INCREASED IN 1975 WITH MORE TARGETED EFFORTS AGAINST YOUNG ADULTS TO MORE FULLY EXPLOIT.THIS POTENTIAL. WE HAVE ALSO INCREASED OUR MEDIA EFFORTS TOWARD YOUNG ADULTS FOR OUR BRANDS'. THESE INCLUDE: • INCREASED ADVERTISING INSERTIONS IN TRADITIONAL YOUNG ADULT MAGAZINES LIKE SPORTS ILLUSTRATED,-PLAYBOY AND MS. • HAVE ADDED NEW YOUNG ADULT SPECIAL INTEREST MAGAZINES LIKE ROAD AND TRACK AND MOTORCYCLING. • EXPANDED OUTDOOR WITH SELECTIVE LOCATIONS FOR MAXIMUM YOUNG ADULT EXPOSURE -- E.G., POSTERS IN GREENWICH VILLAGE AND IN AREAS WITH LARGE COLLEGE STUDENT POPULATIONS.
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CHAB]L#15 EACH OF OUR MAJOR SPECIAL EVENTS IS DIRECTED SPECIAL EVENTS AGAINST YOUNG ADULTS, WINSTON NASCAR, WITH WINSTON, REACHES 8 MILLION SPECTATORS WITH 63% OF THESE UNDER 35 YEARS OF AGE, OUR PARTICIPATION TAKES 2 FORMS: - THE WINSTON CUP/WINSTON WEST SERIES WITH 55 RACES PRIMARILY IN THE SOUTHEAST AND CALIFORNIA, - THE MODIFIED SPORTSMAN WITH 60 RACES IN THE NORTHEAST AND MID-WEST, THUS,- NASCAR GIVES WINSTON NATIONAL COVERAGE, IN RODEOS. WE PROMOTE WINSTON IN OVER 600 EVENTS REACHING 12 MILLION SPECTATORS WITH 57% UNDER 35 YEARS OF AGE -- IN THE MID-WEST AND WEST. C ART #16 FOR CAMEL FILTER, WE HAVE DEVELOPED A NEW STRATEGY. SPECIAL EVENTS WHILE CAMEL CANNOT MATCH THE MEDIA DOLLARS SPENT CAMEL FILTER BY MARLBORO, THE BRAND WILL HAVE PINPOINTED EFFORTS AGAINST YOUNG ADULTS'THROUGH ITS SPONSORSHIP OF SPORTS CAR RACING AND MOTORCYCLING, SPORTS CAR RACING REACHES 300,000 SPECTATORS -- 85% UNDER 35 YEARS OF AGE -- AND IS PRIMARILY ON THE EAST AND WEST COASTS, t .. , ~ ~ ~ ~
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MOTORCYCLING, A NEW SPECIAL EVENT SUCCESSFULLY TESTED IN 1974, WILL-HAVE 26 RACES REACHING 400,000 SPECTATORS WITH AN ESTIMATED 90% UNDER 35 YEARS OF AGE. THIS EVENT WILL BE IN THE MAJOR POPULATION CENTERS SUCH AS CHICAGO, LOS ANGELES. SAN FRANCISCO, AND HOUSTON. CHART #17 SPECIAL EVENTS PROMOTIONAL ACTIVITIES SINCE SPECIAL EVENTS ARE A RELATIVELY NEW AND DIFFERENT TYPE OF ACTIVITY FOR US, I WOULD LIKE TO REVIEW THE NATURE AND EXTENT OF OUR PROMOTIONAL ACTIVITIES IN THEM. FIRST, WE HAVE HEAVY INVOLVEMENT AT THE EVENT SITE, PERMANENT BILLBOARD ADVERTISING, AND BRAND EXCLUSIVITY AT CONCESSION STANDS. WE SELL OUR BRANDED, EVENT-RELATED ITEMS, SUCH AS WINSTON HATS, SHIRTS, AND JACKETS. WE HAVE TIE-IN BANNERS AND PASTERS WITH STRONG BRAND IDENTIFICATIO! AND BRAND COMMERCIALS OVER THE PUBLIC ADDRESS SYSTEMS. WE HAVE STRONG PRESS OUTREACH THROUGH WIRE SERVICES, LOCAL PRESS AND SPECIAL INTEREST PUBLICATIONS. FOR EXAMPLE, AT THE WINSTON WESTERN 500, THE RACE WITH HEAVY MENTION OF WINSTON WAS IN NEWSPAPERS HAVING A CIRCULATION OF 10 MILLION AND ON A 2-HOUR RADIO PROGRAM REACHING 30 MILLION PEOPLE. OUR SALES FORCE WORKS RETAIL STORE TIE-INS TO THE EVENT WITH PRODUCT DISPLAYS AND PASTERS. 50147 7376
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OUR WINSTON #1 AND CAMEL FILTER GT CARS ARE DISPLAYED IN SHOPPING CENTERS IN MAJOR MARKETS, THE WINSTON #1 CAR HAS RECEIVED OUTSTANDING ACCEPTANCE RECENTLY ON THE STREETS OF NEW YORK, LASTLY, WE USE NEWSPAPER AND PROGRAM ADVERTISING FOR IMAGE ASSOCIATION BETWEEN THE-BRAND AND THE SPORT'l, YOU MIGHT LOGICALLY ASK "WHAT DOES ALL OF THIS MEAN IN TERMS OF SALES?" OUR RESEARCH INDICATES THAT AMONG RACING FANS. WINSTON'S SHARE OF SMOKERS IS 67% GREATER THAN AMONG NON-RACING FANS. AMONG RODEO FANS, WINSTON'S SHARE OF SMOKERS IS 50% GREATER THAN AMONG NON-RODEO FANS-, WHILE WE DON'T HAVE DIRECTLY COMPARABLE DATA FOR OUR NEWER CAMEL FILTER SPECIAL EVENTS, OUR RESEARCH INDICATES A DRAMATIC INCREASE IN PURCHASE RATE AMONG FANS ATTENDING. OTHER PROGRAMS HAVE BEEN DEVELOPED TO REACH YOUNG ADULTS WHERE THEY WORK. PLAY AND WHERE THEY PURCHASE THEIR CIGARETTES. FREE-ON-PACKAGE TRIAL INDUCEMENT PROMOTIONS ARE BEING USED IN HIGH TRAFFIC, YOUNG ADULT PACKAGE OUTLETS SUCH AS CONVENIENCE STORES. SEVEN MILLION TRIAL UNITS WILL BE SOLD IN 1975, WE WILL HAVE PERMANENT u COUNTER DISPLAYS IN 35,000 OUTLETS CATERING TO ~ ~ J YOUNG ADULT PACKAGE PURCHASES, ~ ~ J J
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FINALLY, SUCCESSIVE WAVES OF COUPONING WILL BE TESTED IN 1975, BY WAY OF EXPLANATION, WE WILL SELECT A SPECIFIC MARKET OF YOUNG ADULTS,: THESE PEOPLE WILL BE GIVEN SUCCESSIVE WAVES OF COUPONS GOOD FOR A SUBSTANTIAL PRICE REDUCTION ON A CARTON PURCHASE. WE WILL THEN TRACK THIS GROUP TO DETERMINE THE AMOUNT OF SWITCHING TO OUR BRAND. THE STRATEGY HERE IS TO TAKE THESE CONSUMERS "OFF THE MARKET" FOR THEIR REGULAR BRAND LONG ENOUGH TO CONVERT THEM, 62 . OUR SPECIAL MERCHANDISING DIVISION IS IN ITS SECOND YEAR WITH ITS SUCCESSFUL WHOLESALE OPERATION OF PREMIUMS AT BEACHES AND SPECIAL EVENTS THROUGH A SEPARATE SALES FORCE AND A MOBILE STORE. WE ANTICIPATE SELLING OVER A MILLION ITEMS IN 1975 -- A MILLION "WALKING BILLBOARDS" FOR OUR BRANDS. WE WILL CONTINUE OUR SPECIAL SAMPLING PROGRAMS ON BEACHES, RESORT AREAS AND SPORTS ARENAS IN MAJOR METRO MARKETS -- WHERE THERE ARE LARGE CONGREGATIONS OF YOUNG ADULTS, RESEARCH WILL BE DONE IN 1975 TO DETERMINE EFFECTIVENESS OF SAMPLING 4's. 10's, PACKS, AND MULTIPLE PACKS.

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