Tobacco Industry News

Reports

Tobacco companies spending less on promotion
The Federal Trade Commission (FTC) has released its 2010 annual report on tobacco industry expenditures for marketing cigarettes and smokeless tobacco products. The report indicates that the amount tobacco companies spent on cigarette marketing decreased from 2008 to 2009, and again in 2010. In 2010, tobacco companies spent 80.7% of their marketing dollars on price discounts to cigarette retailers and wholesalers, a strategy which results in lower prices for consumers. Click here for more details, or click here to read a press release from the FTC, which links to the cigarette and smokeless tobacco reports. Click here to read a press release from the Campaign for Tobacco-Free Kids which notes that the decline in cigarette sales after the 2009 federal cigarette tax increase is encouraging evidence of the effectiveness of tobacco taxes in reducing cigarette consumption; however, aggressive action at all levels of government is important, as tobacco companies continue to outspend tobacco use prevention efforts by a factor of 18:1.

Reynolds adds aids to stop smoking
Tobacco company Reynolds American Inc. has entered the nicotine-replacement market by releasing a new product that aids in cessation. Reynolds is now test marketing the gum nicotine-replacement product called Zonnic as well as a series of other products to be used as nicotine replacements in Des Moines, Iowa. Zonnic has been approved by the Food and Drug Association (FDA) and will carry a “stop smoking aid” label. Despite a recent study from the Harvard School of Public Health and the University of Massachusetts which suggested that nicotine-replacement products are no more effective in aiding in smoking cessation long term than trying to quit without any aids, a representative from Niconovum USA Inc., Reynolds’ pharmaceutical subsidiary, believes the product’s success will lie in its “unique approach to brand positioning, distribution, packaging and price.” It will be inexpensive and sold in convenience stores and gas stations. Click here to read more.

E-cigs gaining ground: Survey shows segment's growth, retailer optimism
According to a new UBS-CSP Daily News survey of convenience store operators, electronic cigarettes (e-cigarettes) are becoming more popular, and will continue to grow as a category in the convenience sector. More merchants (80%) are selling multiple brands of e-cigarettes, and the products are generating more attention as more smoke-free air laws are implemented. Retailers are still becoming acquainted with e-cigarettes, which are new on the market; however, growth in sales has been reported. A lot is still unknown about the health effects of e-cigarettes, as the Food and Drug Administration continues to investigate the products. Click here to read more.

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