Abstract
In this confidential, internal 1966 Philip Morris (PM) report, PM market researcher Myron Johnston, Jr. analyzes the feasibility of introducing a"health cigarette." The report shows that PM viewed medical reports linking cigarette smoking and disease as simply another driver for the cigarette market.
Ignoring the physical devastation their product causes hundreds of thousands of Americans, Johnston coldly observed that the American Cancer Society's conclusion that cigarettes cause disease in women as well as men could result in the generation of a whole new market for a "health cigarette":
"[Young women's] willingness to accept health filters may increase now that the American Cancer Society purports to have found a relationship between smoking and health for women as well as men. This group could provide a market for a health cigarette..."
and
"Women, and particularly young women, would constitute the greatest potential market for a health cigarette."
He suggests the strategy of marketing a "health cigarette" (or one with the illusion of being healthier) only when pressed to do so by authorities:
"My recommendation is that we not introduce a new health cigarette unless there is another health scare or additional restrictive legislation is passed. In the event of another health scare...our entry should be determined by the form of the scare..."
Johnston also touches on the addictive properties of nicotine as he observes:
"A cigarette that does not delivery nicotine cannot satisfy the habituated smker and cannot lead to habituation, and would therefore almost certainly fail.
He discusses the dynamics of smoking initiation among young people, saying,
"...Tobacco flavor is absent or far down the lists of reasons given for beginning to smoke, so it should be theoretically possible for a health cigarette to satisfy the most common reasons (to be like friends, to feel or look older, to combat nervousness, to be rebellious). This is apparently not the case. Young smokers are the ones...least likely to smoke health cigarettes..."
There is no mention in the report of empathy or concern for the fact that their products cause painful illness and early death among consumers, although Johnston states (on page 1000338652) that "Most smokers would rather quit than switch." The concern is clearly only to determine ways to market more cigarettes.
Quotes:
"Women, and particularly young women, would constitute the greatest potential market for a health cigarette."
"Advertising should be directed to both sexes but in such a way as to have the greater appeal to women."
Fields
- Quotes
"A large proportion of smokers are concerned about the relationship of cigarette smoking to health..."
"The anti-cigarette propaganda will probably be more effective in reducing the rate of smoker recruitment than in stimulating smokers to quit or switch."
"The market share of health cigarettes increases rapidly for a brief period during each health scare and quickly stabilizes at a new and higher level of marketing penetration."
"Thus a new health cigarette entry could not rely on increased demand for health cigarettes, but would have to take its place at the expense of existing brands of health cigarettes..."
"Women, and particularly young women, would constitute the greatest potential market for a health cigarette."
"Advertising should be directed to both sexes but in such a way as to have the greater appeal to women."
"My recommendation is that we not introduce a new health cigarette unless there is another health scare or additional restrictive legislation is passed...."
"I have assumed that any health cigarette must compromise between health implications on the one hand and flavor and nicotine on the other. It seems clear from the performance of existing health cigarette entries that flavor and nicotine are both necessary to sell a cigarette. A cigarette that does not delivery nicotine cannot satisfy the habituated smker and cannot lead to habituation, and would therefore almost certainly fail. Health claims alone without flavor or nicotine cannot sell cigarettes--most smokers would rather quit than switch."
The Beginning Smoker
Persons under 25 years of age constitute over one-fourth of the total number of smokers. Of greater importance is the fact that this group will increase by about 18% between now and 1971...Any intensification of the anti-cigarette propaganda will almost certainly be aimed largely at this group. Indeed, there is evidence that the health scare has already had an effect on the rate of smoker recruitment and on the smoking habits of the under-25 group.
...Toacco flavor is absent or far down the lists of reasons given for beginning to smoke, so it should be theoretically possible for a health cigarette to satisfy the most common reasons (to be like friends, to feel or look older, to combat nervousness, to be rebellious). This is apparently not the case. Young smokers are the ones...least likely to smoke health cigarettes...
Apparently the reasons for beginning to smoke dictate the choice of brand as well, particularly for males. They appear to choose cigarettes that produce a proper image. Males under 25 are much more likely to smoke Winston, Marlboro and Lucky Strike...all of which project a male image...This suggests that there is something of a stigma attached to smoking health cigarettes and that a health cigarette would not be well received by young males.
Young females appear to be more willing to accept health filters, and for them the health filter may have more prestige value...With young women, it may be true that the fact of smoking is the major motivation and that a mild cigarette would be acceptable. Their willingness to accept health filters may increase now that the American Cancer Society purports to have found a relationship between smoking and health for women as well as men. This group could provide a market for a health cigarette.
- Type
- Report
- Company
- Philip Morris
- Author
- Johnston, Myron E., Jr. (PM Marketing researcher)
- Recipient
- Wakeham, Helmut R. R., Ph.D. (PM R&D VP)
Vice President and Director of Research & Development, Philip Morris
- Seligman, Robert B. (PM VP of R&D c. 1976-82)
Vice President of Research and Development at Philip Morris Richmond, VA 1976-1982. Reported to Senior Vice President of Operations. In 1982 transferred to tobacco technology group. Wanted to share ammonia and other tobacco technology with PM International companies.
- Operation/Project
- Health cigarettes
- Region
- US
Document Images
Page 11: bdw67e00
Log in for more options!
I
L
figure 2
SHARE OF MARKET
BY CIGARETTE TYPES
Regular
Page 12: bdw67e00
Log in for more options!
.....,_-) ,......_.,
12
1956
figure 3
SHARE OF MARKET-HEALTH CIGARETTES
All Health Cigarettes
1957
f,
1958
1959
1960
1961
1962
1963
1964
1965
Page 13: bdw67e00
Log in for more options!
(
U
f
;
t
I
L
L
Health scares seem to have the effect of disturbing sales
patterns after which the market adjusts to the di'stu!rbance
and settles down to a new, equi l i bri um. After the heal!thi
scare in the 1950's, sales of heal!thi cigarettes rose from
practically nothing in 1956 to niearly 12'% of the market by
late 1958. They maintai'ned that market share until early
1964, when the market share jumped abrupitly to sllig,htly lless
than 15% and stabilized at that levell. (See Figs. 2 anidl3.)
Curiously, the greatest l'osers among filter cigarette durinig
the recent health scare were the already establi'shied entries
in the hiealth cigarette market. Kent, L & M, and Parliament
all experienced declines in market share from 1962' to 1964,
while some full-flavor filter cigarettes (W'inston, Viceroy,
Raleiigh) were increasing market penetration anid'others (notably
Marlboro,), were holding thiei'r own. Even Pall Mall and Raleigh
nonifi lters mianiaged to increase thiei r market share from 19'63 to
1964. Switching patterns' shed some light upon thiis phenomenon.
Duriing this period Palll Mall lost smokers largely to regu!lar
and menthol fi l ters blut piiicked' upi smokers of regular ci garettes.
Winston, Viceroy, Raileig,h andl Marllboro lost smiokers to menthol
and health fil!ters, but gained even more smokers frominonfilter
brands. Health cigairettes, and particularly charcoal filter
cigarettes, cut very deeply into Kent anidl L& M.
All of this suggests that the h1ealth cigarette market becomes
relatively stable after a sustained period of exposure to a
given level of anti-cigarette propaganda. Thus th.e success of
a hiealth cigarette entry probably dle.pends partly on timing,. Kent,
Newport, Carlton, Lark, Tareyton, and our own entri'es were all
able to capi tal i ze oni the peri'ods of rapi d iincrease in the heal th
10a033S65'7
10
Page 14: bdw67e00
Log in for more options!
cigarette market, while other cigarettes were poorly timed and
notably unsuccessful. Toithe extent that suiccess depends on
timing!, the success or fai lure of a health ciigarette iis tiied
to the intensiity of anti-cigarette piropaganda, which is a
random vari abile and unpredi ctable.
B. The B'eginning Smolker
Persons under 25 years of age constiltute over one-fourth of the
total number of smokers. Of greater importance is the fact that
this group will increase by about 18% between niow and 1971. This
is over three tilmes thie rate of increase in the population aged
25 and over. Any intensification of the anti-cigarette propa-
ganda will, almost certainly be aimed Targely at this group.
Indeed, there is evidence that the health scare has already had
an effect on the rate of smoker recrui tmenit anid on, the smoki ng
habits of the under-25 group (see Item 13 in Appenidix).
It seems highly unlikely that the availability of a demonstrably
healthier cigarette would resu!lt in a chanige in the form of the
anti-cigarette propag,anda: It is d'iffiicult to conceive of the
propagiandists changinig their injunction from "Don't smokee" to
"If you must smoke, smoke a health cigarette." If the anti-
cigarette drive continues to have an effect oniyoung people, it
will pirobably be to diissuade them from smoking, altogether rathier
than to cause themito smoke health cigarettes.
Tobacco flavor is absent or far d'own i'n lists of reasons given,
for beginning to smoke, so it should be theoretically possible
for a healthi cigarette to, satisfy the most common reasons (to be
1000338658
11.
Page 15: bdw67e00
Log in for more options!
F
f
F
u
I
I
~
i
I
I-
t
,
L
like friends, t&feel or look older, to combat nervousness, to
be rebelliou!s),. This is apparently not the case. Young smokers
are the ones most wiilling to accept regular filters but least
likely to smoke health cigarettes (see Table I).
Apparently the reasons for begiinning to smoke dictate the choice
of brandas well, partilcularly for m'ales. Thiey appear to choose
cigarettes that project the proper image. Males under 25 are
much more liikely thani those over 25 to smoke W'instoni, Marllboro
and Lucky Strike (filter and nonfiilter)!, all of which project a
male image; and less likely than their elders to smoke Kent and
Lark, which are thought of (and indeed are), women's cigarettes.
Young males are a1so more likely to follow the crowd: The to~p
two brands among young malles (Winston and M'arllboro) together
account foir nearly 40% of thils market, while for other age groups
the market penetration of the top two, brands is less thian 22°a
except for those 55 and over. This tendency for young, smokers to,
sel!ect a brand to be like thei r friends was also:noted iin a
Nlovember 11961 study done for us by Opini1on Research Corporation.
In that study it was thiought that beginning smokers would seek
out a mild cigarette, since thie initia!l act of smoking, is designed
toisatisfy appearance rathier than taste. As noted above, however,
self-image extends to the choice of brand as wel'l. This suggests
that there iis somethinig of a stigma attachied to smoking health
ci g,arettes and that a heal th ci,garette woullid niot be wel l recei ved
by young males.
Young fema1es appear to be more wi lll i ng toiaccept heal th fiil ters ,
anid for them the health fiilter may have so~me prestige value. They
also are more willing to accept nointobacco flavors such as Lark
and mentholl birands. With young women
12
it may be true that the fact.
1000338659
Page 16: bdw67e00
Log in for more options!
TABLE I
CIGARETTE. TYPE PREFERENCES BY AGE AND SEX, 1965
Male
MenthoI Health Other
Age Nonfi lter Fillter Filter Filter
18-24 281`0 13% 6°0 5~300
25- 34, 37 16 13 3'5
35-44 36; 14 16 33
45- 54 39 11 18 32
55 and~ over 4:& 16 15 30
f
Fema] e
Menthol Hea1 th 0 t h e r
Age Nonfi'l ter Fi 1 ter Fi lter Fi lter
18-24 18°, 29% 19°0 34,°0
25-34 17 30 23 31
35-44 22 27 23 29
45 and over* 26 28 22 23
Source: 1965 HTP Report. Data from other sources show
essenti al'.ly the same patterm.
*Females 55 and over have been combined wiith those age 415-54
because of the small size of the sample. 1000338660
13
Page 17: bdw67e00
Log in for more options!
F
I
I
I
of smoking,is the major moti~vation and that a mild cigarette
would be a:cceptabilie. Their willingness to accept health filters
may inicrease now that the Ameri can Cancer Society plurports to
have founidi a relationshiiip between smoking and health foir women
as well as for men. This groupi could pirovide a market for a
heallth cigarette.
C. Potenitial Switchers
Since beginniing smokers do not constitute a particularly good
market fo:r a healtK cigarette, we must look to potentiall switchers
foir a market. As shown bel ow, the m,agni tu!d~e of swJitchi ng both
between and within cigarette types is d'.irectly related'i to the
intensity of the health scare:
% of All Smokers who Switched:
Periodl To a Different
Cigarette Type To a Different Branid
of the Same Type
Feb. 1957-Feb. 1958 21 10
Mar. 119518-Mar. 1959 17 6
J'une 1960-June 1961 11 7 1-6
O
Miar. 19612-Mar. 1963: 10 5 O
M~ay 1964-May 1965 17 10 CJ
C.J
~
Source: HTI Reports ~ -
It appears fromi these data and thiolse. ci ted above that thie effect-
of the health scares on present smokers is to loosen brand loyalty
and, cause smokers to shi ft back and forth between, brands and types
of cigarettes in proportion to the initensity of the anti-cigarette
14
Page 18: bdw67e00
Log in for more options!
F
I-
I
F
U
I
I
f
I
I-
I-
I
propaganda, wi th an overal l shift toward fi 1 ter cigarettes anid
nontobacco:flavoirs. Several studies have shown that a large
proportion of smokers believe that any filter reduces the health
hazard, and a much, smaller proportioni believe that chiarcoal
filters afford more protection.
Smokers seem, to be able to justify c6ntiniuing! to smoke whatever
type they happen to prefer: Nonfiliter smokers question the
efficacy of filters altogether; smokers of regular filters
questi oni the val!ue of charcoal fi lters; and smokers of charcolall
filters tendlto believe that charcoal filters are healthier.
As mentioned above, an effect of the health scare in the 1i9501's
w,asto i ncrease the market penetrati on of heaIth: ci g,arettesfrom
practi cal!ly nothi n~g i n 1956 to about 12% by 1 ate 1958', and the
release of the Surgeon General's Report was followed by an abrupt
increase to just under 151%. It is clear from these data and from
switching patternis thiat the shifts to! heallth, filters occur
concurrently wiithi heaTth scares, and further that the effect of
the first scare was much greater than the effect of the Surgeon
General's Report (see Figs. 2 and 3). On the basis of these data
we might reasonably expect that any future health scares will have
even less effect on sales of health filters.
Thus, indications are that hiealth cigarettes will maintain a fairly
constant share of the market even in the event of an initensification
of anti-smoking piropaganda. A new entry, therefore, woulid have to^
take its place at the expenise of existing heal'th filter brands. ~
This,, however, should not be particu.llarly difficult. Health ciga-
rette smokers seem to be an unusually fickle lot and there is a
consi derable amount of swi tchi nig among branid's on thei r part. Thi s
1000338662
15
Page 19: bdw67e00
Log in for more options!
F
f
I
I
I
I
I
probably results in part from the newness of the entries and the
low degree of b~ran~d loyalty, and in part from attempts of smokers
to~find a health cigarette with a satisfactory taste lievel. The
acceptan~ce of Lark, as well as menthol cigarettes, suggests that
nontobacco taste is acceptable to a segment of the market in lieu
of tobacco flavor.
The speed with! which charcoal filters penietrated the health ciga-
rette market shows the effectiveniess of a new concept. The public
had been conditioned to accept the filtering effects of charcoal
in other fields, and when charcoal was added to cigarette fillters
it proved tolb:e an effective advertisiing gimmick. The main
beniefi ciiary, of course, was Tareyton, whi ch was the fi rst entry in
the market.
16
Page 20: bdw67e00
Log in for more options!
r
F
(
F
I
I
f
I
. APPENDIX
EVIDENCE OF CONCERN
L
L
L
17
