Tag Archives: Philip Morris

“Be Marlboro” Campaign Aimed at Youth?

Be Marlboro Ads

Recently BBC released a new documentary movie called ” The Seduction of Smoking” , in which it says that Philip Morris International created a marketing campaign for its Marlboro cigarettes to target young people. The talk is about “Be Marlboro” ad campaign which is proved to be aimed particularly at youth.

The Campaign for Tobacco-Free Kids along with other ublic health groups made a report which was released in March 2014. It reflects the results of the research on how the “Be Marlboro” ads uses themes and images which attract young people.

“Be Marlboro” ads was shown in more than 50 countries worldwide despite being prohibited by a German court for targeting teenagers.  The new documentary movie by BBC says that the “Be Marlboro” campaign is a perfect example of how tobacco companies use beautiful and interesting ads to attract young people to their tobacco production. That is the reason why smoking rates among young people remain extremely high in many countries of the world.

Examining “Be Marlboro” ads, the BBC movie concludes that without any doubt young people are main target of the marketing campaign. However, Philip Morris denies that and claims the main target of the campaign are adult people. The ads is about freedom, sex and adventure which people may get if they choose to smoke Marlboro.

Philip Morris Earnings Preview

Marlboro

On April 17, Philip Morris International will present its 2014 first quarter earnings. Experts do expect data from Philippines, where an increase in indirect taxes implemented in 2013 affected negatively tobacco industry.

Experts say that Philip Morris business in European Union, Eastern Europe, Middle East and Africa was affected by numerous anti-tobacco regulations. Russia is company’s biggest tobacco market in the region and all regulations in this country do greatly affect Philip Morris sales volume.

These days Philip Morris International is a leading international tobacco company. Tobacco products manufactured by the company are sold in more than 180 countries worldwide. Its most popular and successful brand is Marlboro. Except the USA and China, Philip Morris holds more than 28 percent of the total cigarette market in the world. Till 2008 Philip Morris International was an operating company of Altria Group.

Representatives of Philip Morris International say that 47% of total volume decline are attributed to its operations in the Philippines. Thus due to significant increase of indirect taxes in the country, the company was forced to increase prices on Marlboro cigarettes by 60%. As a result, Philip Morris International recorded a excessive decline in cigarette shipments to the market in 2013. Today more and more people are looking for discount cigarettes online as it is most beneficail and convenient.

Philip Morris International, Leading Maker of Cigarettes

Marlboro Cigarettes

Coca-Cola is a perfect model of a wonderful business. Altria Group and Philip Morris International are two tobacco companies that have so many important features with Coca-Cola that long-term investors ought to hold all three in the same regard

Coca-Cola, Altria and Philip Morris International are leading companies in their respective markets. Coca-Cola has a leading 17% of its market.

Altria and Philip Morris International  produce Marlboro, most popular cigarette brand, which has a biggest share of tobacco market. Marlboro enjoys a 42.6% share of the U.S. and international market.

Altria, that produces and distributes Marlboro within in the USA, has a 50% share of the U.S. cigarette market, 30% of the U.S. cigar market, and 50% of smokeless tobacco market.

Philip Morris International, that distributes Marlboro worldwide, was spun off from Altria in March 2008. Besides Marlboro, it owns 7 of the top 15 international cigarette brands that includes Philip Morris, L&M and Bond Street. Philip Morris International’s cigarettes brands have a 29% share of the world cigarette market, excluding China and the U.S.

Leading market share provide Altria, and Philip Morris International significant advantages. Smokers are literally addicted to cigarettes and show their favorite brand loyalty.

Besides pricing power, Philip Morris International and Altria, and have significant economies of scale in manufacturing and distribution. Each of these tobacco companies has fixed costs across a number of tobacco products sold in comparison with its competitors, which helps then to get higher operating profits.

Tobacco Companies Should be Banned From Advertising at Labour Party Conferences

Philip Morris

After a robacco company bought space at Labour Party conference, Shadow Health Secretary Andy Burnham said that tobacco companies should be banned from advertising at such events. He became angry when he found out that the party has taken money from Philip Morris, the maker of Marlboro cigarettes, which has a stand in the exhibition in Brighton.

Another spot has been sold to the Tobacco Retailers’ Alliance, a group which is against plain packaging. But the policy is supported by the Labour front bench.  Mr Burnham said that he would like the conference to be totally tobacco-free and this is his firm position.  “My request to the party is to make conference tobacco-free.”

Labour has  over and over again accused the Tories who hired the lobbyist Lynton Crosby as a key election adviser and who brought tobacco companies to the heart of Downing Street.  Mr Crosby’s lobbying firm is reported to have worked in favour of Philip Morris. He was brought in shortly before the Government cancelled plans to standardise packets.

He denies any statement about conversations with Prime Minister David Cameron on the subject.  This week Shadow public health minister Diane Abbott revealed the row at a meeting.  “The health team, led by Andy Burnham, did make representations to the party about this and we were not able to get that changed,” she said. “The health team is not happy about that.”

Labour leader Ed Miliband  on the recent conference criticized the influence of the tobacco companies on the Government in his introduction to the annual report of the party’s National Executive Council (NEC). “Britain’s children don’t have corporate lobbyists looking after their interests, like the big tobacco companies do.”

Labour members say that permitting any particular organisation to display at the conference does not reflect the party opinions.  “The Labour Party exhibition includes stands from a wide range of charities, companies and organisations putting forward their points of view,” a spokesman said. “This does not mean the Labour Party supports the view put forward by the exhibitor.”

Philip Morris Increased Its Market Share

Philip Morris

Philip Morris International presented this week a report which revels that in the first quarter its market share grew on many markets in such countries as United Kingdom,  France,  Italy,  Germany, Canada, and Indonesia.

This year Philip Morris reduced its 2013 earnings guidance to between $5.55 and $5.65 per share. Due to recent changes in foreign exchange rates here it excluded one-time items. The estimate includes a one-year general productivity and cost savings target for 2013 of about $300 million.

The American dollar is rising against other currencies in many countries of the world, therefore companies which sell goods internationally lose money when it comes to converting revenue in foreign currencies back into the dollar. This affects Philip Morris International because most of his businesses he does in different countries in the world.

Tobacco industry analysts wait for new tobacco products from the company. Philip Morris International announced about launch of new generation prodcuts in 2016 and 2017. They told about a new development that heats tobacco in a cigarette with a controlled heating mechanism.

Philip Morris International is the largest cigarette company in the wrold which has its offices in the USA (New York) and Switzerland (Lausanne). It produces such cigarette brands as Marlboro, L&M, Parliament.

Altria Group Inc. is the owner of Philip Morris USA from 2008. Today Altria is the largest U.S. cigarette seller. Analysts expect Philip Morris to report profits of $1.41 per share on revenue of $8.17 milliard. Philip Morris International reported net income of $1.36 per share on revenue of $8.12 billion, excluding excise taxes.

British cigarette branding plan retains

Lucky Strike Pack

The British authorities is still looking at banning branding on cigarette packages despite the fact that it disregarded recommendations from its legislative agenda presented in parliament on Wednesday, Prime Minister David Cameron said.

Britain had seemed to become the first European nation to make tobacco companies to remove brand names and to use standardized packaging, a move opposed by the cigarette makers, which sees it as affecting their earnings.

Queen Elizabeth made no reference to the strategies in a speech placing the government’s legislative plans for the year ahead, attracting criticism from opposition lawmakers and dissatisfaction from anti-smoking groups.

Nevertheless, Cameron told parliament that the authorities were still looking at the issue.

The Department of Health carried out four months of consultations in 2012 to collect evidence on whether plain tobacco packaging would help young smokers stop smoking and help existing smokers forget the habit.

In 2012, Australia enforced a law declaring tobacco products have to be sold in olive green packages with graphic health warning labels.

Cuba, whose high class cigars are world famous and feature exclusive packages, released a challenge against the Australian law at the World Trade Organisation last week.

Despite its lack from the government’s plans, the chief of the opposition Labour Party suggested to help speed through any proposed regulation.

Miliband also asked the role of government adviser Lynton Crosby in the decision, indicating his consultancy firm had worked with cigarette makers.

A spokesman for David Cameron said Crosby cannot influence over the contents of the Queen’s speech.
Campaign groups wrote to Health Minister Jeremy Hunt indicating dissatisfaction over the lack of the plan from the government’s programme.

“The failure to bring forward regulation fatally undermines the Government’s credibility on public health concerns,” said the letter from the Smokefree Action Coalition, an alliance of over 100 health organisations.

Cigarette makers such as Philip Morris and British American Tobacco are worried about that standardized packaging would eat into sales of higher margin brands and say it would lead to the global black market in tobacco.

Imperial Tobacco shares have grown slightly since reports published in the British media that Cameron had dropped the initiative.

Ukrainian legal cigarette market to narrow in 2013

Tobacco Cigarette

The Ukrainian legal cigarette market in 2013 could decrease to 75 billion cigarettes, in comparison to 80 billion items in 2012, states the director for corporate issues at Imperial Tobacco Ukraine, Yuriy Kyshko.

Yuriy Kyshko mentioned that growth in 2012 in the smuggling of cigarettes was observed on the Ukrainian market.

Imperial Tobacco Ukraine CFO Volodymyr Antypenko explained that according to an order of the company, TNS Ukraine experts carried out a research, under which counterfeit product consumption in Ukraine increased from 4.2% in October 2011 to 4.4% in October 2012.

Antypenko added that in 2012 some tobacco companies were participated in price wars on the Ukrainian cigarette market, which were described by the drop in the prices of some products by 15-20% in some locations.

He mentioned that starting with New Year only Imperial Tobacco Ukraine and Philip Morris Ukraine announced new prices of their tobacco products. He considers that the rest of tobacco companies did not raise prices due to the large amount of product stocks or expecting that the law on the hike of excise taxes will be not approved by the Ukrainian president.

Commenting on the impact of the smoking ban at restaurants and bars, which came into force on December 16, 2012 in Ukraine, Antypenko said that it’s difficult to identify how highly the requirement affected cigarette sales.

On November 20, 2012 the Ukrainian parliament passed law, raising excise duties for alcohol and tobacco.

The document supposes a rise in specific excise rates on non-filter cigarettes to Hr 72.70 per 1,000 cigarettes, and on filtered from Hr 110.64 per 1,000 to Hr 162.60 per 1,000 cigarettes.

Starting January 1, 2014, the specific excise rate on non-filter cigarettes will be established at Hr 77.50 per 1,000 items, from January 1, 2015, at Hr 82.50 per 1,000 cigarettes, and excise rate on filtered cigarettes will be Hr 173.2 and Hr 184.50 per 1,000 items.

Philip Morris not to raise cigarette prices

Marlboro Cigarettes

On January, 4 tobacco company Philip Morris Fortune Tobacco Corp. (PMFTC) required its distributors and sellers to market its tobacco products at pre-sin tax recommended retail prices, stating it has not yet increased the prices of its cigarettes.

Cigarette brands, manufactured by PMFTC, are among the most famous among smoking people, including Marlboro.

Cigarette sellers said that many sellers lifted the cigarette prices even before Christmas, even though the higher sin taxes became operational only starting Jan. 1.

“The cigarette maker wants to explain that PMFTC has, up to now, not brought up the prices of its cigarettes,” Philip Morris said.

“It was revealed that some wholesalers and retailers have began marketing cigarette products of the tobacco company at higher prices even in the course of the holidays,” it added.

Some sellers also stated that some distributors had been hoarding last year’s stocks so as to make windfall revenue now that taxes have been brought up.

“We have lifted prices by P1 per stick,” said Aling Edita, who markets cigarettes along Shaw Boulevard in Mandaluyong. “I know that they increased prices by P2 per stick.”

Edita mentioned that a pack of Marlboro used to sell at P33. She added that a stick of Marlboro now brings P4, but said they were offering at P5 in Pasay City.

However, the Rustans Supermarket branch at the Shangri-La Plaza Mall is having a promotional sale with one pack of Marlboro for only P24.

A store owner said that while the supermarket prolonged the offer until January 15, there was “no delivery” of the popular cigarette brands.

PMFTC is a merger between Philip Morris Philippines Manufacturing Inc. and Fortune Tobacco Corp. They deal with 90% of the domestic cigarette market.  Beginning January 1, excise tax on the lower rate cigarettes was increased to P12 per pack while that on the higher rate was established at P25.

Philip Morris introduces price-marked variants of Marlboro cigarettes

Marlboro Gold cigarettes

One of the largest cigarette companies, Philip Morris, is to introduce price-marked variants of one of its premium cigarette brand in London and the South-East to be able to fight “overpricing” in some locations.

Martin Inkster, the new managing director of Philip Morris UK & Ireland, stated that starting with December 2012, wholesalers in London would be provided with price-marked Marlboro Gold cigarettes after study unveiled that the cigarette brand was being overpriced by certain sellers by an average of 24p per pack of 20.

It was found that one retailer in Central London asking £8.99 – £1.10 above the average retail price – for a pack of 20 Marlboro Red cigarettes. WH Smith as well regularly charges over £8 for Marlboro cigarettes, both at travel points and at its high street shops.

Inkster said “savvy smokers” were more and more buying around for the best prices and that overpricing could push smokers either to trade down or even into the arms illegal trade.

“The crucial devices in tobacco are availability, product pricing, and pricing is starting to be really important,” he said. “During economic crisis, it’s of vital importance that sellers price their products competitively”.

“Selling overpriced cigs compromises all of the related sales from other types – most remarkably magazines, bread, milk and soft drinks. This could lead to considerable earnings loss as analysis demonstrates adult tobacco customers visit shops more often than non-tobacco customers and have a much higher basket spend with the average basket spend of an adult tobacco customer being £9.02 compared to a non-smoking adult convenience customer’s spend of £5.77.”

Inkster said that sustaining well-stocked gantries of top brands along with competitive retail prices would profit the whole channel from wholesaler to buyer.

“Stocking PMPs provides adult smokers with assurance that they are not being over-charged, and giving independent retailers with a tool to completely overcome large multiple providers,” he added.

He explained to that PMPs were a method of helping retailers rather than trying to determine margins.

“I would encourage any retailer that is searching for long term success to think about stocking these PMPs. Retailers have to look past the short term margin and understand how important it is for their business that they can retain adult smokers in their shops – eventually it is consumer loyalty and footfall that will profit them in the long run.”

The new Marlboro Gold PMPs will be offered at £7.75 for 20 and £3.94 for 10. Non-price marked packages will be available as well. PMUKI said it had no current ideas to provide PMPs on Marlboro Red cigarettes.

Big Tobacco accused of new smokescreen

Tobacco Cigarettes

Cigarette firms have been taken down once again over their absence of compliance with new plain packaging regulations just day before the law becomes operational.

Health Minister Tanya Plibersek is requiring two industry giants – Imperial Tobacco and British American Tobacco – take away ringed watermarking from their cigarette paper that seem to make their appearance more stylish.

The new regulations demand plain paper.

And she has also told BAT not to place obvious travel destination sources in the batch coding on their cigarettes.

The coding on its cigarettes read LDN, NYC, AUS or OZ in a way the minister says was intended to make people who smoke think of the “glamour of travel”.

“There is a precise set of regulations about what is permitted and if we start permitting variations then the cigarette firms will push the boundaries,” she told.

Its just one of a series of strategies cigarette firms have been using to subvert the new regulations that from December 1st require all cigarettes be sold in olive packaging with graphic warning labels covering 75%  of the front of the pack.

Ms Plibersek attacked cigarette firms in September for perpetrating a “sick Joke” when they started providing new plain packs that stated “It’s what’s on the inside that counts.”

At the same time, Action on Smoking and Health says that cigarette maker Imperial Tobacco has been providing roll-your-own smokers with free tins placed with the old branded packaging name “Champion”.

And two weeks before plain packaging appeared, a new brand of cigarette has been released called “Ice” – the term of an illegal drug, as outlined by ASH chief executive Anne Jones.

Imperial Tobacco refused that JPS Ice was a drug reference. A spokesperson stated that it is a mint flavoured cigarette and the name `Ice’ is a typical descriptor used by the tobacco industry to differentiate equally flavoured cigarettes.”

The minister has as well charged Philip Morris of “deliberately trying to create chaos” around the launch of plain packaging by declining to change branded packs held by small businesses for plain packaged packs.

Domenico Greco from the Combined and Mixed Business Association said that the firm was not changing packs if small businesses bought fewer than 4000 cigarettes per week.

The company did not discuss the association’s accusation head-on, but spokeman Chris Argent said that Philip Morris has been cooperating with the federal government and retailers to guarantee an easy transition to plain packaging.

The minister said that her major goal is the cigarette firms and that small-business owners who break the new cigarette plain packaging regulations that come into effect from December 1 are more probably to be “educated” than fined up to $1 million for selling tobacco products with branding.