Background – Moist Snuff Moist Snuff – 2006* –85.1% ($2.21 billion) of SLT sales –Ad/promotion expenditures: $308.46 million all-time high &46.6% increase over 2005 expenditures In the first half of 2009, USST sold 267 million cans of Copenhagen and Skoal** Moist Snuff responsible for growth in SLT category, seen as having potential for continued growth * FTC Smokeless Tobacco Report for 2006 ** Richmond Times-Dispatch 8/09
Top Moist Snuff Producers U.S. Smokeless Tobacco (USST) (#1) –Copenhagen, Skoal, Red Seal, Husky, Timber Wolf –As of 2009 - owned by Altria (parent company of Philip Morris) Conwood (#2) –Kodiak, Hawken, Grizzly, Cougar –As of 2006 – owned by Reynolds America (parent company of RJ Reynolds) Swedish Match –Timber Wolf, Longhorn, Redman
Increase in Smokeless Tobacco Sales And Use Driven By New customers, including smokers looking for an alternative to cigs New products –New flavors –New varieties –New brands New marketing themes, strategies Entry of cigarette companies into SLT marketing
Barriers to Their Success Smokers lack of experience with SLT “Ick” factor/ negative perceptions Rural image Male-only image Lack of a ritual similar to that involved in smoking Skoal Website 2005
Current Marketing Channels Publicly Visible Products themselves Magazine ads In-store promotions Under the Radar Direct mail Brand loyalty programs Brand websites & email Events/community presence
Found in: FHM Field & Stream April 2005 Classic Copenhagen New Targets – Reaching Past a Rural Image
Found in: Field & Stream Playboy Pop Mechanics Copenhagen 2007-08
New Strategies – Relationship Marketing Skoal’s “Brotherhood” campaign becomes “official” in 2007. Promoted through: –Magazine ads –New website (Jan 2008) –Direct mail
Popular Mechanics, 2007Playboy, 2007 Relationship Marketing Promoting “The Brotherhood ”
Ad Found in: Golf Digest (March 2005) Entertainment Weekly (Feb 2005) Newsweek (Sept., Oct. 2004) New Targets – SLT for When You Can’t Smoke
Skoal 2008 Direct Mail Cover: “You’ve been asking for it...We heard you.” 9/09 - Philip Morris CEO says PM and USST plan to " take advantage of the rapid growth in pouches“ – so we know there are more to come.
Skoal 2009 – 75 th Anniversary Celebration Jan 2009 issue of Playboy Year long sweepstakes with monthly prizes and year-end grand prize (enter daily online) Free spittoon gift Found in Car & Driver, Field & Stream, Maxim, Popular Mechanics, 2/09
“These premium, spill- resistant spittoons have a removable funnel, weighted base and compact design that fits most cup holders....our way of saying thanks for 75 years of support.” “Use your personal ID on SkoalBrotherhood.com to find out which color mud jug will be yours !”
New Cigarette-Branded Products RJ Reynolds – Camel Snus, Camel Dissolvables, Camel Dip Philip Morris - Marlboro Snus, (Taboka, Marlboro Dip) Advantages of Cig Brand Link –Brand names familiar to smokers, non- smokers alike/have loyal customer base –Marketing links – attach promotions or products to cig packs, use smoker database to ID people to mail to.
Direct Mail Promotes Camel Crush and Camel Snus
Snus Magazine Ad Taglines freedom for smokers. your cigarettes may get jealous.
Snus Goes Well With Anything “Friendly” Tailored Taglines Field & Stream: Tent-friendly. Hunting-friendly. Canoe- friendly Rolling Stone: Air guitar-friendly. Encore-friendly Sports Illustrated: Boring blowout game-friendly. Stadium-friendly Popular Mechanics: Up all night rebuilding an engine- friendly. Car & Driver: Stick shift-friendly. Retain that new car smell.
Camel Dissolvable Tobacco Camel Sticks – a twisted toothpick-sized stick – flavor: “mellow” Camel Orbs – a pellet – flavor: flavor “fresh mint”, “mellow” Camel Strips – a film strip for the tongue – flavor: “fresh mint”