The cigarette industry's dominant player has not bought a single magazine ad in 2002. And Philip Morris is cutting back significantly for the rest of the year in what could be the last call for its paid media advertising.
The fallout from the cutback will deal a serious blow to the recession-plagued publishing industry. Philip Morris accounted for $114.7 million of the $267 million the tobacco industry spent on magazine advertising in 2001.
More significantly, it could signal a near or complete withdrawal of the industry bellwether from the last refuge in mass media: Philip Morris catapulted from also-ran to industry domination by harnessing the power of media advertising. The Marlboro Man, Advertising Age's top ad icon of the 20th century, rode off TV screens in 1971 with the tobacco industry's voluntary ban on broadcast advertising and off billboards in 1999 as part of the industry's Master Settlement Agreement with states attorneys general.
Even though tobacco's print ad expenditures are tiny, compared to the $6.6 billion spent on retail incentives like promotional allowances in 1999, Philip Morris' pullback is hardly good news for magazine publishers suffering through a stagnant ad economy.
Philip Morris' move essentially shuts out monthlies for the first quarter because of production deadlines; weeklies could still get some ads. But publishers are uncertain about cigarette ads bouncing back, saying the tobacco unit of Philip Morris Cos. has been frustratingly opaque about its plans for the rest of the year.
Philip Morris has been reducing its magazine spending -- by 50% from 1999 to 2001, according to the company -- largely due to its voluntary departure from more than 40 magazines with high youth readerships and its decision to stop buying the back cover of any title, once a high-profile platform for cigarette ads.
But the company does not bill its decision to further reduce print advertising in 2002 as a youth-smoking prevention tactic.
For now, there's no indication the rest of the tobacco market will follow the leader. Tobacco ad cutbacks in magazines have been accelerating over the years. In 1981, the cigarette category was the No. 1 revenue generator for magazines; today it's No. 21. Tobacco companies accounted for 2.3% of U.S. measured media spending in 1970, the last year of TV ads, and only 0.5% in 2000 -- and spending has plummeted since then.
The industry leader's shift stands to enhance public perception, a welcome benefit for Philip Morris Cos. as it prepares to distance itself from tobacco roots by renaming itself Altria.
"By not advertising, they may be doing better things for their public, corporate image and branding than by advertising and taking all the flak for doing it," said Robert Thompson, Syracuse University professor of media and pop culture. "The best kind of advertising may be no advertising."