Philip Morris USA is trying to draw two of its premium brands out of the shadow of Big Red with radically new advertising strategies.
Leo Burnett USA, Chicago, is behind the campaigns for Benson & Hedges and Merit. Both are designed to recoup share for brands that--despite a combined $45 million in ad spending last year--are being slowly strangled by PM's Marlboro.
Benson & Hedges replaces humor with sexy sophistication in a campaign that breaks in July issues of magazines. The strategy harks back to the brand's successful 1980s campaigns showing the smokes in various social settings.
This time around, the campaign uses sultry, smoky executions to depict smokers in glamorous nightclub settings. Initial ads support the menthol line, which accounts for 56% of Benson & Hedges' sales.
LIGHTHEARTED TACK SHELVED
The ads replace a lighthearted campaign that showed cigarettes lounging like humans in hammocks and chairs and featured taglines such as, "Sitting and talking. Benson & Hedges." The company has been working to change that creative since a tobacco industry settlement with state attorneys general that blocks the use of "anthropomorphic" cigarettes in advertising.
"We changed it to be in compliance with the agreement," a spokeswoman said.
The B&H switch dovetails with a new creative direction on Merit, Philip Morris' low-tar smoke. In June magazines, Merit replaces its long-running "Yes I can!" theme with the line "Discover the rewards of thinking light."
The tagline is illustrated via amusing situations such as a ballet-dancing sumo wrestler and an Eskimo loading up an oversize dogsled that's being pulled by a dachshund.
Marlboro's share of industry shipments rose 2 percentage points to a record 37.9% in the first three months of 1999, according to Philip Morris' first-quarter earnings report. That gain came at the expense of a 0.4-point drop in share of industry shipments for Benson & Hedges, Merit, Parliament and Virginia Slims. Combined, those brands commanded only 4.6% of total industry shipments, about one-eighth those of Marlboro.
MARLBORO OVERWHELMS SIBLINGS
"Marlboro has been the breadwinner," said Manny Goldman, analyst at Merrill Lynch & Co. "All [Philip Morris] premium brands except Marlboro are flat to down. They've been overwhelmed by the tremendous growth of Marlboro."
As a result, Philip Morris "has been trying to maximize its premium lines," said Brown Bros. Harriman & Co. analyst Roy Burry.
Both Merit and Benson & Hedges may also have been hurt by Marlboro line extensions, such as its light and menthol varieties. Marlboro Ultra Lights, a Merit competitor launched this year, picked up almost a full share point this year.
Of course Philip Morris ultimately wins regardless of share shifts among its own brands. PM's overall share of the cigarette market for the first quarter is 50.1%, compared to 22.9% for No. 2 R.J. Reynolds Tobacco Co., according to figures from Davenport & Co.
"It's a problem everybody would like to have--a colossal, category-dominating brand," said one former tobacco executive. "It's the horse that drives [Philip Morris'] whole bottom line." But, he added, "Nobody, even Philip Morris, likes to have all their eggs in one basket."
Copyright May 1999, Crain Communications Inc.