MILES COULDN'T READ THE SMOKE SIGNALS

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Mike Miles' big mistake was he played the game like the package goods marketer he is-focusing on shoring up the market share of Marlboro. What he didn't realize, because he's a non-tobacco guy, is the power trust at Philip Morris doesn't care about market share.

What they care about is milking the profits of a dying business for as long as they can-until cigarettes are declared illegal or regulated as a drug. So the new leaders at the company will once again raise prices as often as they can get away with. And with Marlboro's share of market at a record 28% there is a lot of money to be made by kicking up prices and letting Marlboro's market share slowly decline.

Nobody told Mike Miles that this was-and always has been-the strategy of Philip Morris. It was unspoken and completely understood by the tobacco people: Wring the maximum return on a business that might not be around much into the 21st century.

Of course Mike Miles wouldn't have taken the top job in the first place if he knew these were his marching orders, and he's better off running a company that really wants to build market share.

But given this tobacco mindset-which is deeply ingrained at all the cigarette companies-does it make any sense that tobacco companies give a hoot about the concerns of other marketers and advertisers?

That's why it is totally naive of us to think that R.J. Reynolds will voluntarily give up its Joe Camel ads for the greater good of advertising. In our editorial repeating our call of 1992 that "Joe Camel must go," we conclude that if Reynolds persists with Joe Camel "that course puts the future of all tobacco advertising at risk, to insure sales and profits for Camel today."

Bingo. That's exactly what Reynolds and Philip Morris want. Both Marlboro and Camel have greatly improved market share, and Philip Morris has called off the price wars (that's something that true tobacco people no doubt regarded as unseemly). Can you imagine how much money they could make if they no longer had the expense of advertising and they could raise prices every chance they got?

I agree with Reynolds on one point: They are not surreptitiously trying to hook young kids on smoking by using the amiable Joe Camel character. All they want to do is convince current smokers to switch to Camel; they can't worry about attracting kids because they know they won't be in business long enough to reap the benefits.

But if we are naive, the tobacco people are disingenuous. The chairman-CEO of R.J. Reynolds Tobacco Co. wrote us that "what has happened over the past three years with Camel and the tobacco industry can happen to any manufacturer of any product in America," and he called on industry to "take a stand."

The Joe Camel argument is not one of freedom of speech, no matter the pious statements of Reynolds and other tobacco brands. It is about milking a dying business until it is dead, and that is not the overriding activity of the rest of American business.

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