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NEW YORK: Tobacco giants Altria and BAT are to spend millions of dollars over the next year on self-critical advertising on broadcast television networks and in leading newspapers as part of a legal settlement of a case brought almost 20 years ago. In 1999 the US Department of Justice initiated a lawsuit over misleading statements the industry had made about cigarettes and their health effects; a document filed in the US District Court for the District of Columbia Monday evening by attorneys for Altria, BAT and the Justice Department, outlined the agreement all parties have reached. This involves Altria and BAT buying television spots, mostly on ABC, CBS or NBC, and full print ads in 45 or more newspapers, starting as soon as next month, the Wall Street Journal reported . The TV spots will run in prime time five days a week for 52 weeks, while the print ads will run on five weekends spread over four months and ads will also appear on the newspapers’ websites. These will display court-mandated text , with copy including: “Altria, R.J. Reynolds Tobacco, Lorillard, and Philip Morris USA intentionally designed cigarettes to make them more addictive” and “More people die every year from smoking than from murder, AIDS, suicide, drugs, car crashes, and alcohol, combined” . Altria, which owns Philip Morris USA, estimated that it will spend $31m fulfilling its obligations; BAT declined to cite a figure. “I think they’re getting off kind of lightly,” said John Boiler, co-founder of the 72andSunny agency, which also does work for the anti-tobacco, non-profit Truth campaign. “The good news for the tobacco companies is they’ll avoid a lot of their younger audience,” he explained, since those consumers would be more likely to see a video ad on Facebook than a prime-time TV ad. 2016 research by the Centers for Disease Control and Prevention in Atlanta has suggested that younger consumers are more likely to be exposed to ads for e-cigarettes: 70% of US teens had seen ads for e-cigarettes – most often in-store (55%), but also online (40%), on TV or in movies (37%) and in print (30%). “The same advertising tactics the tobacco industry used years ago to get kids addicted to nicotine are now being used to entice a new generation of young people to use e-cigarettes,” said CDC director Dr.
The government statistics are based on officially imported tendu leaves, according to Ridley. Since there has been evidence of a local source of tendu leaves as well as seizures of smuggled tendu leaves, these are “additional components” that need to be included in the calculation, she said. Some smokers of Capstan cigarettes, the company’s lowest-priced brand, have cut back on the number of sticks they buy after the price increases and also purchase beedis, said K.K. Badra, 58. She runs a kiosk that sells soft drinks, packaged snacks and other food items apart from tobacco products in Maligawatta, a Colombo suburb. Ceylon Tobacco is looking to contain the impact from higher levies. It has shut some of its leaf depots and reduced factory shifts to curb costs. To sustain profitability it’s working on “smart cost management, streamlining processes, identifying consumer segments and addressing their needs,” said Ridley. The company is also widening its portfolio. It started selling its popular Gold Leaf brand in a smaller packet of 12 sticks apart from the 20-stick packet, introduced a new product Gold Leaf Red and is unveiling John Player Navy Cut, which will be sold for 40 rupees a stick. Still, those efforts may not completely offset the impact from the higher levies. Both revenue and net income will grow at a slower pace this year, according to Chayanika Ranasinghe, an analyst at CT CLSA Securities Ltd., in Colombo.
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