History of Tobacco

Tobacco has a long history in the Americas. The Mayan Indians of Mexico carved drawings in stone showing tobacco use. These drawings date back to somewhere between 600 to 900 A.D. Tobacco was grown by American Indians before the Europeans came from England, Spain, France, and Italy to North America. Native Americans smoked tobacco through a pipe for special religious and medical purposes. They did not smoke every day.

Tobacco was the first crop grown for money in North America. In 1612 the settlers of the first American colony in Jamestown, Virginia grew tobacco as a cash crop. It was their main source of money. Other cash crops were corn, cotton, wheat, sugar, and soya beans. Tobacco helped pay for the American Revolution against England. Also, the first President of the U.S. grew tobacco.

By the 1800’s, many people had begun using small amounts of tobacco. Some chewed it. Others smoked it occasionally in a pipe, or they hand rolled a cigarette or cigar. On the average, people smoked about 40 cigarettes a year. The first commercial cigarettes were made in 1865 by Washington Duke on his 300 acre farm in Raleigh, North Carolina. His hand rolled cigarettes were sold to soldiers at the end of the Civil War.

It was not until James Bonsack invented the cigarette making machine in 1881 that cigarette smoking became widespread. Bonsack’s cigarette machine could make 120,000 cigarettes a day. He went into business with Washington Duke’s son, James “Buck” Duke. They built a factory and made 10 million cigarettes their first year and about one billion cigarettes five years later. The first brand of cigarettes were packaged in a box with baseball cards and were called Duke of Durham. Buck Duke and his father started the first tobacco company in the U.S. They named it the American Tobacco Company.

Credit An 1892 Duke of Durham box of machine rolled cigarettes Tobacco Biology & Politics

The American Tobacco Company was the largest and most powerful tobacco company until the early 1900’s. Several companies were making cigarettes by the early 1900’s. In 1902 Philip Morris company came out with its Marlboro brand.

They were selling their cigarettes mainly to men. Everything changed during World War I (1914 18) and World War II (1939 45). Soldiers overseas were given free cigarettes every day. At home production increased and cigarettes were being marketed to women too. More than any other war, World War II brought more independence for women. Many of them went to work and started smoking for the first time while their husbands were away.

By 1944 cigarette production was up to 300 billion a year. Service men received about 75% of all cigarettes produced. The wars were good for the tobacco industry. Since WW II, there have been six giant cigarette companies in the U.S. They are Philip Morris, R.J. Reynolds, American Brands, Lorillard, Brown & Williamson, and Liggett & Myers (now called the Brooke Group). They make millions of dollars selling cigarettes in the U.S. and all over the world.

In 1964 the Surgeon General of the U.S. (the chief doctor for the country) wrote a report about the dangers of cigarette smoking. He said that the nicotine and tar in cigarettes cause lung cancer. In 1965 the Congress of the U.S. passed the Cigarette Labelling and Advertising Act. It said that every cigarette pack must have a warning label on its side stating “Cigarettes may be hazardous to your health.”

By the 1980’s, the tobacco companies had come out with new brands of cigarettes with lower amounts of tar and nicotine and improved filters to keep their customers buying and to help reduce their fears. The early 1980’s were called the “tar wars” because tobacco companies competed aggressively to make over 100 low tar and “ultra” low tar cigarettes. Each company made and sold many different brands of cigarettes.

In 1984 Congress passed another law called the Comprehensive Smoking Education Act. It said that the cigarette companies every three months had to change the warning labels on cigarette packs. It created four different labels for the companies to rotate.

Public Law 98 474, “Comprehensive Smoking Education Act, 1984”

Credit Smoking Tobacco & Health, Centers for Disease Control

Since the 1980’s, federal, state, local governments, and private companies have begun taking actions to restrict cigarette smoking in public places. The warning labels were the first step. Tobacco companies cannot advertise cigarettes on television or radio. It is against a law that was passed by Congress in 1971. Many cities across the U.S. do not allow smoking in public buildings and restaurants. Since 1990, airlines have not allowed smoking on airplane flights in the U.S. that are six hours or less. State taxes on cigarettes have increased.

As it becomes more difficult for tobacco companies to sell their products in the U.S., they are looking outside. U.S. tobacco companies are now growing tobacco in Africa, South America (Brazil and Paraguay), India, Pakistan, the Phillipines, Greece, Thailand, and the Dominican Republic. Fifty percent (50%) of the sales of U.S. tobacco companies go to Asian countries, such as Thailand, South Korea, Malaysia, the Phillipines, and Taiwan.

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Is it possible to sell a premium cigarette brand in this packaging? – business insider

Savanna tobacco refutes cigarette smuggling charge
Philip Morris International is the first tobacco giant suing the Australian government over strict new branding restrictions, which it believes will cost it billions in the region, the Wall Street Journal reports.

British American Tobacco and Imperial Tobacco Group are expected follow.

Why? Because their billion dollar brands, like Marlboro and Parliament, will be crushed.

Australia’s regulations, set to take effect in December 2012, require cigarette manufacturers to use a standard font, uniform text position, and the same greenish brown packaging (which research showed to be the least appealing to consumers).

Essentially, tobacco companies will be unable to distinguish themselves. And that has the tobacco giants worried. Cigarettes can separate themselves from competing products in three ways by brand, by shape (long, short, etc.), and by general flavor (light, menthol, etc.). But within the confines of a given style or flavor, brand becomes the most valuable distinguishing factor among otherwise like products.

Earlier this year, shortly before legislation made its way to Australian Parliament, a Philip Morris spokesperson told AdWeek the measures “would essentially amount to a confiscation of our brand in Australia.”

And that could very well be disastrous for the company. A November 2010 report by economic consultants in the U.K., commissioned by Philip Morris, says that “package is the most important method of branding still available” after a widespread crackdown on traditional advertising.

Researchers at a New Zealand university who conducted focus groups with 66 young adults, both smokers and non smokers, found that branded tobacco packaging by itself inspired their associations with given products.

The U.K. report, which specifically focuses on the impact plain cigarette packaging could have there, substantiates Philip Morris’ bottom line worries. It suggests a branding ban like Australia’s would trigger an overall price reduction between 4.4% and 16.1%, because no name discount brands could more easily compete. After all, they wouldn’t have a highly recognizable brand (like Marlboro, for instance) to overcome.

With a move toward hard line bans like the one in Australia, one that will disallow in store cigarette displays in the U.K., and the Worcester, Mass., ordinance that prohibits any tobacco advertisement visible from the street, tobacco manufacturers will eventually have to look outside branded packaging and find another way to set themselves apart.

Now see how Burger King built its brand around one simple idea >