In 1890, Duke Tobacco's ambitious James "Buck" Duke established the Tobacco Trust, which acquired Duke's domestic rivals, then raided British competitors. In 1907, the trust's activities were found to be in violation of the Sherman Antitrust Act and, in 1911, the U.S. Supreme Court ordered the trust dissolved into its principal components: American Tobacco Co., Liggett & Myers, Lorillard, R.J. Reynolds Corp. and several smaller companies.
The breakup of the trust resulted in an explosion of cigarette brands from the new rivals in 1912 and 1913, when market conditions combined to favor the introduction of a national cigarette brand. (Earlier offerings had been either local or regional.) RJR produced the first truly national brand in Camel, which was introduced by N.W. Ayer & Son. By 1915, Camel had become the top-selling U.S. cigarette, available in all 48 states.
Camel's success inspired others, and in 1916 American Tobacco responded with Lucky Strike, which offered a money-back guarantee. L&M followed the lead of RJR and American Tobacco and took its reformulated Chesterfield national; by 1917, Chesterfield had captured 10% of the market.
Camel, Lucky Strike and Chesterfield dominated the cigarette market during World War I, when soldiers' ration kits included packs of cigarettes. After the war, in a market with little actual product differentiation, advertising emerged as the essential ingredient of the marketing mix.
In 1921, RJR spent $8 million on the "I'd Walk a Mile for a Camel" campaign. In 1933, Philip Morris introduced the "Call for Philip Morris" campaign, with real-life bellhop Johnny Roventini dressed in his hotel uniform. Positioning became a central feature in cigarette advertising that continued into the 21st century.
In the 19th and early 20th centuries, smoking was considered unladylike in many countries. One popular 1925 Chesterfield ad campaign, "Blow Some My Way," showed a woman watching a man smoking, but a taboo against depicting women in ads actually smoking—or even holding a cigarette—persisted.
One strategy aimed at women associated smoking with weight control. In 1928, for example, Albert D. Lasker of Lord & Thomas developed "Reach for a Lucky Instead of a Sweet" for Lucky Strike. The campaign use celebrity endorsements, including one featuring aviator Amelia Earhart.
American Tobacco and public relations executive Edward Bernays addressed women's reluctance to smoke in public by linking smoking with the women's emancipation movement. Mr. Bernays hired 10 fashion models and debutantes to walk down New York's Fifth Avenue during the 1929 Easter Parade dressed as "Statues of Liberty," holding aloft lit Luckies like "torches of freedom."
Smoking became so common among women that when Philip Morris introduced Virginia Slims in 1968, it capitalized on the progress of the women's liberation movement with the congratulatory "You've Come a Long Way, Baby" ad campaign.
Along with successes in targeting women came some famous failures. Philip Morris in 1927 unsuccessfully attempted to redesign its Marlboro cigarette specifically for women. A quarter-century later, however, the marketer succeeded in repositioning Marlboro as the quintessential filter cigarette for men. The rugged Marlboro cowboy image created in the 1950s by Leo Burnett Co. and its "Come to Marlboro Country" campaign launched in the early 1960s propelled Marlboro to No. 1 worldwide by 1972. Ironically, women as well as men were attracted to Marlboro's rugged image.
The 1930s and '40s
By 1930, Lucky Strike (with a $19 million ad budget) had surpassed Camel in sales; Chesterfield was No. 3, and Lorillard's fast-rising Old Gold moved into a distant No. 4.
The 1940s were a decade of growth for the tobacco industry in general, and cigarettes once again showed up in kits for soldiers during World War II. Motion pictures evolved into a venue popular with cigarette marketers, which began to place individual brands into the hands of hot Hollywood stars. Humphrey Bogart, for example, elevated smoking to a new level of artistic expression in the 1943 film "Casablanca." After that, paid product placement became an effective promotional form that flourished for decades.
The 1950s were the golden age of cigarette advertising on TV. In 1950, Camel, No. 1 in sales (98.2 billion cigarettes annually), sponsored the "Camel News Caravan"; No. 2 Lucky Strike sponsored "Your Hit Parade" and "The Jack Benny Show"; and No. 3 Chesterfield sponsored Arthur Godfrey. Philip Morris, not even among the top five brands, sponsored the No. 1-rated "I Love Lucy."
Much cigarette advertising from this era either claimed or implied that smoking was healthy. Celebrity presenters, such as John Cameron Swaze, assured the public, "When your nerves are shot, Camels set you right." Mr. Godfrey talked about an alleged scientific study showing that "smoking Chesterfield would have no adverse effects on the throat."
Later, as actual scientific studies began to indicate there were indeed health hazards associated with smoking and consumers grew concerned, cigarette ads focused on the supposed benefits of cigarettes with reduced tar levels. Competing claims introduced what became known as the cigarette ad "Tar Derby," in which rivals sought to outdo each other as the cigarette with the lowest amount of tar. Cigarettes' nicotine content also became a concern after Consumer Reports rated cigarettes by nicotine level.
Individual manufacturers, faced with a growing list of health concerns associated with tobacco, responded by "improving" filters. Benson & Hedges touted Parliament's cotton "recessed filter"; in 1952, Lorillard introduced a "micronite filter" for Kent; and the following year L&M advertised its filter as "just what the doctored ordered."
By 1960, Pall Mall had taken the sales lead away from Camel. RJR's Winston, introduced in 1953 with the ungrammatical slogan "Winston tastes good like a cigarette should," quickly became the leading king-sized filtered cigarette and the No. 3 brand overall.
In 1960, cigarette manufacturers agreed to a voluntary ban on claims regarding reduced nicotine and tar and switched their strategy, touting the presumed benefits of the new filters. Terms such as "light," "pure," "clean," "mild," "natural" and "fresh" appeared in ads to reassure consumers that cigarettes were not dangerous. Even smoke disappeared from the picture.
In 1963, American Tobacco launched an ambitious strategy to develop a brand for every conceivable market niche, adding seven variants to its Lucky Strike line and, in 1965, line extensions of Pall Mall as well as completely new brands. Other cigarette marketers followed suit, with each brand extension supported by a significant ad budget, and cigarette advertising burgeoned. Philip Morris' Benson & Hedges Co. recast its B&H brand as an extra-long, 100-millimeter cigarette, and ad agency Wells, Rich, Green touted the length in its "The Disadvantages" campaign.
In 1964, a report from the U.S. Surgeon General directly linked smoking to cancer, lung and heart disease, which led to the 1965 National Association of Broadcasters' Cigarette Advertising Code limiting ad claims on TV and radio. In 1965, Congress passed the Cigarette Labeling & Advertising Act, which required manufacturers to place health warnings on cigarette packages. The following year the Federal Trade Commission extended that requirement to cigarette ads, prohibited ad claims related to the healthfulness of cigarette filters or products, and banned advertising aimed at people younger than 25 years of age. (Smoking among teenagers had reached 40% in 1963.)
Antismoking ads began appearing on TV after the Federal Communications Commission initiated the Fairness Doctrine, which required broadcasters to provide equal time to all points of view on a subject. In exchange for a halt to such antismoking ads, cigarette marketers in 1970 agreed to put an end to all TV advertising.
The 1970s and '80s
Beginning in 1971, the Public Health Smoking Act required marketers to place a stronger warning on cigarette packages and banned cigarette advertising altogether on TV and radio. Cigarette marketers shifted their ad spending into sponsorships of popular televised sporting events. Philip Morris, for example, launched the Virginia Slims tennis tournament, and RJR initiated Winston Cup auto racing.
By the mid-1970s, with health authorities worldwide issuing warnings about cigarettes, manufacturers turned to increasingly sophisticated consumer research to guide their ad strategies. In 1976, Philip Morris introduced the Merit "ultra low-tar" brand, backed by a $40 million ad budget. To counter Merit and other ultra low-tar and -nicotine brands, American Tobacco and RJR ads pointed out that cigarettes with lower nicotine and tar had poorer taste.
In 1980, Marlboro was No. 1 in sales (103.6 billion cigarettes); Winston fell back to No. 2; Kool, which sponsored major jazz festivals, moved up to No. 3; and Salem was No. 4. Annual cigarette consumption peaked in 1981, with 640 billion cigarettes sold.
On Camel's 75th anniversary in 1988, McCann-Erickson introduced an updated version of Old Joe, which first appeared on Camel packaging in 1913, in the "Smooth Character" campaign that proved particularly attractive to underage smokers. RJR Nabisco, the new name of Camel's marketer following a merger, withdrew the character in 1997 after negative publicity linked Old Joe to underage smoking.
Merchandising of items that displayed cigarette names and logos such as shirts and toys that were not required to bear health warnings became a big business in the last decade of the 20th century. Although U.S. law prohibited the sale of such items to those under age 18, many children and teens nonetheless sported gear bearing cigarette brand names and trademarks.
In 1996, the Food & Drug Administration imposed sweeping restrictions on cigarette advertising in an attempt to protect children. At the beginning of 1999, following a settlement with state attorneys general that required cigarette marketers to stop outdoor advertising, cigarette ads in magazines jumped 33% in just two months.
But that was just a temporary trend. In 2002, for example, Philip Morris announced it would cut back significantly on magazine ads. Overall, tobacco ad cutbacks in magazines have been accelerating. In 1981, the cigarette category was the No. 1 revenue generator for magazines; by 2004, it was No. 21. Tobacco companies accounted for 2.3% of U.S. measured media spending in 1970, the last year of TV ads. Thirty years later, it was only 0.5%.
International restrictions on cigarette advertising also increased, and by 1995 more than 20 nations had enacted total cigarette advertising bans. (The European Union plans to ban tobacco advertising starting in 2006.) Although U.S. cigarette sales were declining at the beginning of the 21st century, markets in Africa, Asia, Eastern Europe and South America offered opportunities.