POP Goes the Power Wall? Taking Aim at Tobacco Promotional Strategies

EDITORIAL 209 Tob Control: first published as 10.1136/tc.2004.009043 on 25 August 2004. Downloaded from

Promotion will presumably become even more ...... prominent. Tobacco promotion at retail is pervasive. The Point of Purchase Advertising POP goes the power wall? Taking aim Institute monitors in-store advertising expenditures for 22 industries, and at tobacco promotional strategies reveals that the tobacco industry is the top spender on in-store media.15 utilised at retail Merchants receive significantly more money for tobacco display allowances T Dewhirst relative to other product categories. Feighery and colleagues, for example, ...... compared incentive programmes among small retail outlets in Santa Clara, Tobacco promotion at the retail level is pervasive California for five different product types: tobacco, beer and wine, soft drinks, snack foods, and candy. They obacco firms face an increasingly retail merchandising contracts are now found that, among the five measured stringent regulatory environment. the most potent part of a tobacco com- product categories, approximately 78% TDespite having fewer viable options pany’s marketing arsenal, and ‘‘the con- of incentive payments came from in the promotional mix, industry pro- tracts are cigarette marketers’ primary tobacco firms.16 motional spending has persisted, reach- marketing tool since the 1998 Master US tobacco firms typically provide ing record levels. In the USA, $11.22 Settlement Agreement prohibited most incentives to retailers in exchange for billion was spent on tobacco promotion tobacco advertising’’.13 Amere2%ofUS their brands having at least 40% of shelf during 2001.1 Once one form of promo- tobacco advertising budgets was dedi- space (Philip Morris and RJ Reynolds tion is banned, tobacco firms utilise cated toward magazines, newspapers, (RJR) purportedly negotiate for as much other marketing strategies to continue and outdoor locations in 2001.1 Yet, when as 55%), obtaining desirable shelf place- communicating brand imagery. Radio combining the point-of-sale advertising, ment, displaying promotional items and and television advertising was no longer promotional allowances (payments to signage, meeting minimum sales acceptable for cigarettes in New retailers for shelf space), and retail value volume standards, providing ‘‘buy- Zealand, the UK, the USA, Canada, added (costs associated with bonus items downs’’ (retailers pass along reduced and Australia, commencing in 1963, distributed at retail when cigarettes are prices to consumers), and maintaining 1965, 1971, 1972, and 1976, respectively. purchased) categories, Federal Trade one of their brands as the cheapest Consequently, the tobacco industry Commission data reveal that US tobacco available.13 17–19 Some of these incentive shifted their promotional spending lar- firms now spend 85% of their promotional programmes have undergone consider- gely toward the print media. Individual dollars via retailers. A similar scenario is able scrutiny, being the subject of tobacco companies also turned to spon- evident in Canada. Based on data gleaned antitrust litigation initiated by compet- http://tobaccocontrol.bmj.com/ soring broadcast sports events to com- from internal industry documents, ‘‘retail ing tobacco firms. The Liggett Group pensate for lost broadcast advertising POS’’ and ‘‘trade promotion’’ accounted filed an antitrust suit against RJR exposure. In Canada, with the imple- for 53% of the Canadian tobacco indus- claiming that the firm’s ‘‘Everyday Low mentation of the Tobacco Products try’s promotional budget in 1996.14 At the Pricing’’ programme was unfair. In an Control Act that stipulated a ban on time, sponsorship was also permissible, attempt to minimise the competitive- tobacco product advertising, expendi- generating 41% of promotional spending. ness of contending deep discount tures on sponsorship increased consid- Considering that a tobacco sponsorship brands, RJR’s programme required that erably during the late 1980s and early ban has been implemented in Canada their brands, such as Best Value or 1990s.2 And once bans were placed on since October 2003, promotion at retail Monarch, be the lowest priced offerings tobacco sponsorship in countries such as at retail.17 RJR, meanwhile, alleged that Australia, Canada, and New Zealand, Philip Morris’ ‘‘Retail Leaders’’ pro- the tobacco industry placed further gramme, implemented in 1999, was on September 29, 2021 by guest. Protected copyright. resources toward point-of-sale strate- anti-competitive because the firm had gies, package design, trademark diversi- considerable clout with its market share fication, direct marketing campaigns, and was forcing retailers to give brands, and ‘‘cigarette girls’’ who returned to such as Marlboro, superior shelf posi- 17 20 bars and nightclubs.3–9 In the USA, a ban tions. on billboard advertising, in accordance with the 1998 Master Settlement REPETITION Agreement, prompted an increase in Repetition is regarded as a cornerstone the prevalence of both interior and principle for successfully communicat- exterior tobacco advertising at retail ing brand identity. Repetition, both over outlets (fig 1).10 11 Richard Pollay has time and across multiple media, pro- remarked, ‘‘It’s like squeezing a balloon. motes ‘‘friendly familiarity’’. A dense You can shut down one media, but the environment of cigarette promotion and problem just moves somewhere else’’.12 imagery gives the impression that In the context of partial advertising tobacco use is socially acceptable, desir- bans, retail promotion, which consists of Figure 1 Marlboro signage, located next to a able, and prevalent.21 These impressions point-of-sale (POS) or point-of-purchase gas (petrol) station in Baton Rouge, Louisiana, are further reinforced by the fact that USA, serves as a ‘‘mini-billboard’’. Camel (POP) advertising, has become a central ‘‘Pleasure to Burn’’ ads were also affixed to cigarettes are so readily available. focus of tobacco marketing efforts. streetlights situated on gas station property. Because tobacco products may be According to US advertising trade press, Photo taken on 29 March 2004. acquired at a vast array of outlets,

www.tobaccocontrol.com 210 EDITORIAL Tob Control: first published as 10.1136/tc.2004.009043 on 25 August 2004. Downloaded from contradictory messages are communi- 9 Sparks R, Dewhirst T, Jette S, et al. Historical hangovers or burning possibilities: regulation and cated about the dangerousness of pro- adaptation in global tobacco and alcohol duct use. In this issue of Tobacco Control, sponsorship. In: Amis J, Cornwell TB, eds. Global Henriksen and colleagues22 add to the sport sponsorship: a multidisciplinary study. (in press). literature about children and youth 10 Celebucki CC, Diskin K. A longitudinal study of being exposed to cigarette promotions externally visible cigarette advertising on retail in POP environments.23 24 In many cases, storefronts in Massachusetts before and after the retailers with in-store tobacco promo- Master Settlement Agreement. Tobacco Control 2002;11(suppl II):ii47–53. tions are located in close proximity to 11 Wakefield MA, Terry-McElrath YM, schools25 26 and in-store promotions and Chaloupka FJ, et al. Tobacco industry marketing cigarettes are often displayed at low eye at point of purchase after the 1998 MSA 27–29 billboard advertising ban. Am J Public Health levels adjacent to candy. 2002;92:937–40. In some jurisdictions, action has been 12 Herring HB. Signs of bygone days. The New York taken to counter the promotional impact Times, 25 April 1999:Sec.4, 2. 13 Beirne M. Tobacco row: cigarette makers step up at retail. In Saskatchewan, provincial retail war. Brandweek 2002 December 2:3. legislation took effect on 11 March 2002 14 Pollay RW. Tobacco promotion spending patterns and stipulates that both the promotion in Canada. Prepared for JTI-Macdonald Corp., Imperial Tobacco Canada Ltd., and Rothmans, and display of tobacco and tobacco- Benson & Hedges Inc. v. The Attorney General of related products are prohibited in loca- Canada, Quebec Superior Court, Exhibit D- tions where people less than 18 years 239a, 2002. 15 Gottesman A. Store wars. Adweek old have access. The Tobacco Control 1997 December 1:20. Act prompted cigarette ‘‘power walls’’ to 16 Feighery EC, Ribisl KM, Achabal DD, et al. Retail be covered, and retailers used curtains, Figure 2 Out of sight, out of mind: Under trade incentives: how tobacco industry practices Section 6 of Saskatchewan’s Tobacco Control compare with those of other industries. Am J Public frosted glass, and closed cupboards to Health 1999;89:1564–6. ensure that tobacco products were Act, cigarettes are no longer visible when 17 Beirne M. Big tobacco gets tough. Brandweek not publicly displayed (fig 2).* During purchasing the twizzlers or jawbreakers that 14 May 2001:29–34. are seen in the foreground. Photographs taken 18 Bloom PN. Role of slotting fees and trade May 2002, Rothmans, Benson and 5 October 2003. promotions in shaping how tobacco is Hedges (RBH), Canada’s second larg- marketed in retail stores. Tobacco Control est tobacco manufacturer, challenged 2001;10:340–4. 19 Feighery EC, Ribisl KM, Clark PI, et al. How the Act on constitutional grounds. seem warranted, but anything short of a tobacco companies ensure prime placement of The legislation was upheld by the full tobacco promotion ban (as stipu- their advertising and products in stores: interviews Saskatchewan Court of Queen’s Bench lated by the Framework Convention on with retailers about tobacco company incentive during September 2002, yet RBH was programs. Tobacco Control 2003;12:184–8. Tobacco Control) will merely prompt 20 Balto D. Recent legal and regulatory successful when appealing the decision. another shift in promotional spending. developments in slotting allowances and category The Saskatchewan Court of Appeal Alluding to the earlier quote about management. Journal of Public Policy and Marketing 2002;21:289–94. declared the Act inoperative under the squeezing a balloon, it is now time to 21 Pollay RW. How cigarette advertising works: http://tobaccocontrol.bmj.com/ premise that Section 6 was inconsistent ‘‘pop’’ the balloon in the interest of rich imagery and poor information. Expert with Section 30 of federal legislation, public health. report prepared for JTI-Macdonald Corp., the Tobacco Act. The Supreme Court of Imperial Tobacco Canada Ltd., and Rothmans, Benson & Hedges Inc. v. The Attorney General of Canada has authorised Saskatchewan to Tobacco Control 2004;13:209–210. doi: 10.1136/tc.2004.009043 Canada. Quebec Superior Court, Exhibit D-57, appeal the most recent decision, and it is 2002. expected that the case will be heard Correspondence to: Professor Timothy Dewhirst, 22 Henriksen L, Feighery EC, Schleicher NC, et al. Reaching youth at the point of sale: cigarette during 2005.31 Saskatchewan, with a Dept of Management & Marketing, College of Commerce, University of Saskatchewan, 25 marketing is more prevalent in stores where population of roughly one million, does adolescents shop frequently. Tobacco Control Campus Drive, Saskatoon, SK, S7N 5A7, 2004;13:315–8. not represent a large market for the Canada; [email protected] Canadian tobacco industry. However, if 23 Schooler C, Feighery EC, Flora JA. Seventh Timothy Dewhirst is a Canada-US Fulbright graders’ self-reported exposure to cigarette Section 6 of Saskatchewan’s Tobacco Scholar, with the University of California, San marketing and its relationship to their smoking behavior. Am J Public Health 1996;86:1216–21. Control Act is upheld, similar stipula- Francisco hosting a six month research term 24 Donovan RJ, Jancey J, Jones S. Tobacco point of on September 29, 2021 by guest. Protected copyright. tions are expected to be enforced in sale advertising increases positive brand user Manitoba, as well as Canada’s most imagery. Tobacco Control 2002;11:191–4. populous province, Ontario. It is also REFERENCES 25 Anon. Retail promotions on the rise. Filter tips: anticipated that the Supreme Court of 1 Federal Trade Commission. Federal Trade a review of cigarette marketing in Canada, 2nd Commission cigarette report for 2001. ed. Physicians for a Smoke-Free Canada, 1999. Canada trial will help inform the imple- Washington DC: FTC, 2003. http://www.smoke-free.ca/filtertips02/ mentation of retail display ban policies 2 Dewhirst T. Smoke and ashes: tobacco Retail.htm. being proposed elsewhere (for example, sponsorship of sports and regulatory issues in 26 Slater S, Chaloupka FJ, Wakefield M. State variation in retail promotions and advertising for South Africa, Ireland, and New South Canada. In: Kahle LR, Riley C, eds. Sports marketing and the psychology of marketing Marlboro cigarettes. Tobacco Control 31 Wales, Australia). communication. Mahwah, NJ: Lawrence Erlbaum 2001;10:337–9. The retail venue is now the primary Associates, 2004:327–52. 27 Cummings KM, Sciandra R, Lawrence J. Tobacco advertising in retail stores. Public Health Reports promotional medium for the tobacco 3 Weir J. Tobacco advertising: the New Zealand experience. Tobacco Control 1995;4:90–1. 1991;106:570–5. industry. Left unregulated, tobacco mer- 4 Fraser T. Phasing out of point-of-sale tobacco 28 Feighery EC, Ribisl KM, Schleicher NC, et al. chandising in the retail environment advertising in New Zealand. Tobacco Control Cigarette advertising and promotional strategies in retail outlets: results of a statewide survey in will continue to proliferate. Policies such 1998;7:82–4. 5 Harper T. Marketing life after advertising bans. California. Tobacco Control 2001;10:184–8. as Saskatchewan’s Tobacco Control Act Tobacco Control 2001;10:196–7. 29 Terry-McElrath Y, Wakefield M, Giovino G, et al. 6 Carter S. Worshipping at the Alpine altar: Point-of-purchase tobacco environments and promoting tobacco in a world without advertising. variation by store type – United States, 1999. MMWR Morb Mortal Wkly Rep 2002;51:184–7. * ‘‘Power walls’’ refer to the extensive rows of Tobacco Control 2001;10:391–3. 7 Wakefield M, Letcher T. My pack is cuter than 30 Greaves L. Canada: demolishing the power cigarette packages, in quantities that far exceed your pack. Tobacco Control 2002;11:154–6. walls. Tobacco Control 2003;12:7–8. what is needed to meet short term purchase 8 Carter SM. New frontier, new power: the retail 31 Cunningham R. Banning retail displays and levels, which are commonly visible as a back- environment in Australia’s dark market. Tobacco signage. Toronto, Canada: Ontario Tobacco drop to the cash register.30 Control 2003;12(suppl III):iii95–101. Control Conference, 6 May 2004.