What is POS? Price promotions: –Value-added (buy-one-get-one free, etc.) –Buy-downs Retailers sell products at discounted rate, tobacco company cuts a check for the amount lost by retailer at the end of buy- down period
What is POS? Promotional allowances paid to retailers –Allowances given to retailers to facilitate sales Shelving Stocking Displaying merchandise Volume rebates
POS is largely unregulated by the: –Master Settlement Agreement (1998) –Smokeless Master Settlement Agreement (1998) These settlements are legal agreements between the largest tobacco companies and Attorneys General across the country; they restrict the type of marketing that these companies can participate in. Regulation
Contracting Usually (but not always) POS is set-up and enforced through contracts with retailers –Makes it difficult to work with retailers on voluntary POS reduction policies –Often negotiated at highest corporate level
Contracting In the past, POS contracts have focused primarily on cigarette marketing. However, higher taxes and increasing smoke-free laws have forced the industry to begin focusing on OTP- Other Tobacco Products
Cigarette Promotion From 1998 to 2006, the U.S. cigarette advertising and promotions budgets nearly doubled growing from $6.7 billion to $12.5 billion –In 2006, approximately 84%, or $10.5 billion, of this was spent advertising and promoting cigarettes at the point-of-sale Source: Federal Trade Commission. Federal Trade Commission Cigarette Report for 2006. Washington, DC; 2009.
Smokeless Promotion From 1998 to 2006, the U.S. smokeless tobacco advertising and promotions budgets more than doubled growing from $145.5 million to $354.1 million –In 2006, approximately 65%, or $230 million, of this was spent advertising and promoting smokeless tobacco at the point-of-sale Source: Federal Trade Commission. Federal Trade Commission Smokeless Tobacco Report for 2006. Washington, DC; 2009
Why is POS Important? Past research has shown that POS has been more prevalent in stores where adolescents shop frequently Exposure to higher levels of POS increases the likelihood that adolescents will start smoking Henriksen L, et al. Tobacco Control 2004;13(3):315-8. Slater SJ,, et al. Archive of Pediatric Adolescent Medicine 2007;161(5):440-5.
Why is POS Important? Communities with disadvantaged socioeconomic profiles tend to have the most tobacco advertising Smokers of mentholated brands (typically youth & minorities) are more likely to take advantage of promotional offers Laws MB, et al. Tobacco Control. 2002;11 Suppl 2:ii71-3. Barbeau EM, et al. Preventive Medicine. 2005;40(1):16-22. White VM, et al. American Journal of Preventive Med. 2006;30(3):225-31.
Ramsey Tobacco Coalition (RTC) Research Summer 2007- attempted to collect POS data from all licensed tobacco vendors in Ramsey County, W. St. Paul, and S. St. Paul –652 licensed vendors total –Gathered complete (interior and exterior) POS data on 491 vendors; gathered data on just exterior POS on 52 vendors
Smokeless Tobacco Findings Interior advertisements for smokeless tobacco were found in 20% of stores Chain stores were more likely than non- chain stores to display ads for smokeless tobacco (35% vs. 8%)
Most Advertised Brands in Study Area Marlboro, Camel, Newport These three brands are also the most commonly preferred brands among youth aged 12-17; 81% of smokers in this age group report preferring one of these brands Source: Centers for Disease Control, 2009
Stores in block groups with a larger proportion of the population that was African American or living below the poverty line were more likely to have more tobacco ads (p< 0.01).
Policy Options How other states are taking action –Reduce Remove (CA): Voluntary removal of tobacco advertisements –Media literacy (NY): Educate public about POS effect on young people –Petition for legislature to pass a resolution to reduce tobacco ads in stores (NY) –Tobacco ad teardown: Youth ask stores to remover advertising in exchange for youth clean up store/grounds (WY) –Legislature banning advertisements in pharmacies (San Francisco and Boston) Before After
Policy Options Enforcement of sign code Enforcement of vending machine laws Imitation tobacco ordinance Prohibit sale of loosies License fees
Ramsey Tobacco Coalition work on imitation tobacco products ordinance –Grew out of POS assessment Policy Based Youth Programming
Policy Example Youth met with key decision makers in St. Paul, shared findings and asked for change Introduction and passage of a St. Paul ordinance banning imitation tobacco products aimed at kids, recommended by World Health Organization.
FDA Regulation FDA Regulation of advertising– wait and see what happens here –Starting in Sept 2012, regulates point-of-sale tobacco advertising (tombstone) –Allows states and local governments to regulate promotional activities (coupons, value-added, buy-downs, etc.)
FDA Regulation Highlights Requires larger more visible, and more informative health warning labels, including color graphics Local and Federal government can restricts the advertising at the local level as long as it is related to TIME,PLACE and MANNER Bans outdoor advertising 1,000 feet from schools and playgrounds Limits ads to black and white visuals Bans brand sponsorship of sports and entertainment events Light, Low and Mild descriptors removed
Cigarette pack now Cigarette pack under FDA Regulation Front Back Front Back WARNING LABEL WARNING LABEL
Start Noticing … Educate … Advocate Betsy Brock, MPH Director of Research email@example.com or 651.646.3005 Katie Engman, CHES Tobacco Programs Manager firstname.lastname@example.org or 651.646.3005