Niche Marketing – Smokers’ Lounge

Puru Gupta looks at cigarette advertising.

In Chicago, R. J. Reynolds, the 2nd largest tobacco company in the United States, has introduced a new premium-priced line of smokes called Marshall McGearty as an upscale smoking lounge in trendy market areas. Exclusively marketed at the lounge itself, the smokes are made out of fresh tobacco leaves and will be hand-rolled by a tobacconist. They are available in nine flavors and would be priced at $8 per pack.

Tagging premium cigarettes as “works of art”, their objective was clear – to make some of the world’s best smokes and to build unique sanctuaries where their works of art could be properly enjoyed. This reflects in their advertising campaign too!

Though a 1998 Master Settlement Agreement strictly bans smoking in bars and restaurants, Chicago’s ordinance excludes “retail tobacco stores,” places where 65 percent of the sales are of “tobacco” or “tobacco accessories,” according to the city’s Law Department. Marshall McGearty is technically a “tobacco retail store,” where at least 65 percent of sales of are tobacco or tobacco accessories, making it exempt from the ban. Many cities in the United States include similar exemptions in their smoking ordinances, including New York, where sales of tobacco at exempted stores must account for more than half of sales.

Though the concept is new, experts are apprehensive of its impact on the teens. Commenting on the emulative tendencies of the teens, some say that “the fact that it’s for adults only increases its attractiveness to adolescents, because the most effective marketing campaigns to kids are those that make cigarettes a part of looking like a successful, virulent young adult.”
Some steps have been taken to reduce such anticipated criticism. The website allows only visitors over 21 years, and the same restriction applies to the entry inside the Chicago lounge. Advertising mentions the warnings explicitly and so do the packages.

Says an industry analyst, “They’re trying something completely different. They’re openly trying to create an allure. If it works, I can see the other companies lining up to try something like it.” For now, none of RJR’s rivals, which include Philip Morris and Lorillard, have opened smoking lounges or employed a glamour strategy.

Contributed By Puru Gupta