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Marlboro Adverts Target Youth in Southeast Asia Asia is the biggest target of tobacco industries, such as Philip Morris International (PMI). In 2010, PMI shipped 282 billion sticks to the region. In 2012, more than 36% of PMI’s revenue came from Asia and it generated about USD21 billion in sales, shipping more than 326 billion sticks to Asian markets.i PMI launched a new “Don’t Be A Maybe – Be Marlboro” advertising campaign as one of its key driver to renew market share.

The Marlboro brand is worth USD67 billion – a sum much larger than the health budgets of the ASEAN countries. PMI first launched the Be Marlboro campaign in 2012 in 20 countries, starting with Germany, and then expanded it to 50 countries in 2013ii PMI 2012 Annual report says that the company is allocating marketing budget for implementing its “Be Marlboro" campaign. However tobacco companies do not report to governments the amount they spend on advertising and promoting their cigarettes.

This advertising campaign's targets young people to recruit future long term customers for PMI. The advertising uses images appealing to young people and their sense of freedom and innovation. Adverts show images of young people doing extreme sports and modern dance to plug into their lifestyle. According to ZACK Investment Research, Marlboro seems to be more popular among working young adult smokers.iii

Philippines and Indonesia are two target countries in Southeast Asia where the Be Marlboro advertising campaign has been launched since 2013. It is evident in traditional media such as billboard, poster, promotional events and online.iv

In the Philippines, tobacco advertising is banned in most media except at points-of-sale and this presents a loophole where the Be Marlboro adverts are found. Due to the tobacco tax increase in 2013, PMI's market share went down from 87% in 2012 to 72% in 2013. However, PMI still controls majority cigarette market share. In 2014, PMI will step-up promotions to increase sales volume and market share, and the Be Marlboro advertising will be an important marketing strategy.

Besides the Philippines, the Be Marlboro advertising is found in Indonesia, an important market of PMI. Indonesia has about 65million smokers and hence is a big market in the ASEAN region for PMIv, and it reaps huge profits there. Marlboro occupies 7% of the total cigarette market in Indonesia. In 2013, although Indonesia faced an economic slowdown causing higher price for fuel and food, the cigarette industry increased volume by about 2% to an estimated 308 billion sticks. In 2009 PMI sold 11.6 billion Marlboro sticks and in 2012, sales increased to 14.5 billion sticks and is still on an upward trend.vi

Indonesia: The cowboy image that has always been used by Marlboro, is no longer relevant with the urban lifestyle in Indonesia. That is why Marlboro is rolling the new global campaign out with the title Be>Marlboro in Indonesia. With this campaign launched in a press conference in Prive Club Jakarta, Marlboro wants people to have more comfort and confidence in chasing their dreams. Marlboro will hold many exclusive programs and interactive session. Here’s a taste of their campaign: “So, take the lead in your life. Never say maybe, Be>Marlboro”. Ref: http://beatmag.com/jak/scoop/be-marlboro.html  

Philippines: "Don't be A Maybe" billboard, Metro Manila, HealthJustice, 2013

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In other countries, like Thailand, Vietnam and Malaysia, where a relatively tight ban on tobacco advertising is in place, there is no explicit information on PMI’s campaign launch. However Marlboro

promotions can be easily found online. Several Facebook pages promoting the Be Marlboro campaign were are available. The pages present photos of promotional events in many countries. The majority of guests joining the campaign appear relatively young, middle class urbanites that use social network to reach other young people by posting information and sharing photos.

Additionally with aggressive advertising PMI’s light and mild cigarettes are increasing in popularity. In Indonesia in 2014, PMI expects to profit from the growth of Light kretek segment, which increased to 40.5% last year, in which Sampoerna A and U Mild had grown 46.4% segment share. In addition, PMI is gaining market share in the regular kretek segment with Dji Sam Soe Magnum. Although the government introduced a regional 10% tax in

January, PMI says this is manageable as it will pass-on only 3% and 6% to smokers.

Vietnam and Thailand are also targeted by PMI to expand its growth opportunities. Vietnam is slated as showing strong potential: 2009 – 0.5% and 2012 – 2.8% market share. PMI has partnership with Vinataba to produce Marlboro.

Regulation on TAPS

In the ASEAN region all countries, except Indonesia, are parties to the WHO Framework Convention on Tobacco Control (FCTC). FCTC Article 13 Guidelines sets out clearly what constitutes a comprehensive ban on tobacco advertising, promotion and sponsorship (TAPS). Most countries have put in place comprehensive ban on TAPS except the Philippines which still allows advertising at points-of-sale while Indonesia has no advertising at all (Table 1). As illustrated above PMI exploits loopholes in the law to continue advertising. Every POS is an opportunity to advertise – this means in the Philippines there are about 695,000 opportunities and 2.5 million in Indonesia for tobacco companies to advertise to the public including minors.

 

Photo on Facebook page promoting "Don't Be A Maybe – Be Marlboro", March 2012, Ref: http://on.fb.me/1jPO792

Indonesia: "Maybe I will take the challenge Be Marlboro", Billboard on Route Malioboro, Aug 2013, Yogyakarta, Indonesia. Ref: http://whyquit.com/Youth/Marlboro_Maybe_Ads.html  

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Table 1: Tobacco Retail Outlets and POS Regulation

Country Number of retail

outlets

Regulation of Point-of-Sale

(POS) Advertising  

Cambodia -- Banned

Indonesia 2,500,000 No Ban Lao PDR -- Banned Philippines 694,821 No Ban Malaysia 80,000 Banned Singapore 5,335 Banned Thailand 570,000 Banned Vietnam 120,000 Banned

The Be Marlboro campaign and other tobacco advertising in the Philippines and Indonesia stress the importance for countries to have a comprehensive ban on TAPS as tobacco companies spend their advertising dollars promoting their brands at all avenues still open to them.

Recommendation

A comprehensive ban on tobacco advertising, promotion and sponsorship includes the following:

• All direct and indirect advertising, promotion and sponsorship without exemption; • Commercial communication and commercial recommendations and actions; • Contributions of any kind to any event, activity or individual; • Advertising and promotions or tobacco brand names and all corporate promotions; • Traditional media (print, television and radio) and all media platforms, including internet, mobile

telephones and other new technologies as well as films.

                                                                                                                         i What Factors Drive Philip Morris’ Cigarette Revenues In Asia? 2 Apr 2013; http://www.trefis.com/stock/pm/articles/175058/what-factors-drive-philip-morris-cigarette-revenues-in-asia/2013-04-02

ii PMI 2012 Annual Report, pg 13 http://bit.ly/1f4jirW

iii ZACK Investment Research, Philip Morris Inc (PM-NYSE), February 28, 2014, http://nt4.zacks.com/ZResearch/PublSnapshotPdf/PM.PDF  iv HealthJustice, 2013, Marlboro Don’t Be A Maybe Campaign Philippines 2013

v PMI, Philip Morris International Inc. 2013 Fourth-Quarter and Full-Year Results Conference Call, February 6, 2014 vi Paul Janelle, President Director, PT HM Sampoerna Tbk, 2013 Asia Region Investor Field Trip – Indonesia Surabaya, June 4, 2013

-Southeast Asia Tobacco Control Alliance