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Internal R.J. Reynolds Documents Detail Cigarette Marketing Aimed at Children

By John Mintz and Saundra Torry
Washington Post Staff Writers
Thursday, January 15, 1998; Page A01

R.J. Reynolds Tobacco, the nation's second-largest cigarette company, sought for decades to reverse the declining sales of its brands by developing aggressive marketing proposals to reach adolescents as young as 14 years old, according to internal company documents released yesterday.

The papers, which span from 1973 to 1990, include confidential marketing surveys, communications to the RJR board of directors, reports by outside advertising firms, long-term planning documents and other internal memos, all of which deal with the youth smoking market.

The 81 documents contrast sharply with the company's repeated public declarations that it does not target young people, collectively sketching a picture of a company that seemed decades ago to determine that its financial future depended on recruiting a new generation of smokers.

Many of the documents outline RJR's thinking that led up to the 1988 launch of its controversial Joe Camel cartoon advertising campaign. The campaign, criticized by federal officials and public health activists who said it appealed to children, was voluntarily ended last year by the company.

The issue of tobacco companies' marketing to youth has become the major focus of the national debate about smoking. The Food and Drug Administration has asserted authority over tobacco products to reduce youth smoking, also a primary goal of the proposed national tobacco settlement that Congress will consider when it returns.

Yesterday, RJR repeated its denial that it had targeted young people and said it remains committed to reducing youth smoking. The documents were taken out of context, the company said.

"Our documents reflect the social attitudes of the times in which they were created. And while attitudes toward smoking have changed over the past several decades, [Reynolds's] position and policy have remained constant: that smoking is a choice for adults and marketing programs are directed at those above the legal age to smoke," the company said.

The documents, most of which have never before been made public, were released by Rep. Henry A. Waxman (D-Calif.), who obtained them from law firms that had worked with California lawyer Janet Mangini. Mangini sued RJR to stop the Joe Camel campaign in 1991. Last September, the company and Mangini settled the case, and RJR agreed to release internal files on sales to young people.

One of the documents quotes from a Sept. 30, 1974, presentation to the Reynolds board of directors in Hilton Head, S.C., in which the company's marketing vice president, C.A. Tucker, addressed the looming decline in RJR's business and the need to reorient the company's entire marketing focus on young people.

"They represent tomorrow's cigarette business," Tucker said. "As this 14-24 age group matures, they will account for a key share of the total cigarette volume for at least the next 25 years." Noting a surge in youth sales by competitor Philip Morris Co.'s Marlboro brand, Tucker added, "This suggests slow market share erosion for us in the years to come unless the situation is corrected. . . . Our strategy becomes clear for our established brands: 1. Direct advertising appeal to the younger smokers."

Some members of Congress and public health activists said the documents could damage prospects for congressional passage of a national tobacco settlement, in which the industry would pay billions of dollars in exchange for some protection against lawsuits.

Former FDA commissioner David A. Kessler said the documents will have profound effects in Congress and the courts because now "there's no question" that tobacco companies have targeted children. "If you are looking for a smoking gun regarding youth smoking, you need to look no further," he said.

The Justice Department also is investigating whether RJR and other tobacco firms committed perjury or hampered federal investigations by telling Congress, FBI agents and FDA investigators that they never deliberately marketed to children.

The documents outline Reynolds executives' concern about the company's future because of two facts about cigarette smoking known to RJR researchers: First, cigarette brand loyalty is so strong that it is extremely tough to get smokers to switch brands. Second, the great majority of smokers -- in the mid-1970s RJR estimated up to 75 percent, but recent research shows 89 percent -- started smoking by age 18.

RJR's brands, including Winston and Camel, had been losing sales since the mid-1960s, when Philip Morris introduced its Marlboro Man ad campaign. Considered the most successful ad campaign in the history of advertising, the campaign featured virile men in cowboy hats, boots and chaps, and sales among young people surged. In contrast, Reynolds's brands such as Winston, with its "Winston tastes good like a cigarette should" campaign, flagged.

In a Feb. 2, 1973, memo, RJR senior researcher Claude Teague wrote, "If our company is to survive and prosper, over the long term we must get our share of the youth market."

There are numerous other references from the mid-1970s to discussions by RJR officials about the company's need to appeal to 14- to 24-year-olds. In a Jan. 23, 1975, memo, RJR official J.W. Hind wrote that "to ensure increased and longer-term growth for Camel Filter, the brand must increase its share penetration among the 14-24 age group, which . . . represent tomorrow's cigarette business."

In a July 1980 memo to then-Reynolds Chairman E.A. Horrigan, then-Executive Marketing Vice President Gerald Long (later Reynolds's chief executive officer) noted that Marlboro's share of the 14- to 17-year-old market was 59 percent, while the RJR brands' combined share of this youth market was 19.9 percent. "Hopefully," Long wrote, "our various planned activities that will be implemented this fall will aid in some way in reducing or correcting these trends."

Starting around 1980, as anti-tobacco lawsuits mounted, RJR officials stopped referring, even internally, to any interest in marketing to anyone younger than 18. A September 1980 memo, stamped "Confidential," said executives must change their terminology, even internally, for referring to this "target market."

But in a July 1982 agreement, RJR contracted with Atlanta-based Data Resources Inc. to develop "AGEMIX," a system to track smoking rates among people as young as 12. A 1984 report by RJR researcher Diane Burrows, stamped "Secret," contains a chart identifying "younger adult" smokers as young as 12.

That 1984 RJR marketing department report exhaustively examined the history of the market appeal of U.S. cigarettes, brand by brand. In it, Burrows wrote, "If younger adults turn away from smoking, the industry must decline, just as a population which does not give birth will eventually dwindle. . . . The renewal of the market stems almost entirely from 18-year-old smokers."

The documents never explicitly state that the company launched Joe Camel to attract young smokers, but they seem to provide strong support for that. The campaign was based on an earlier ad blitz in France during the 1970s that was a smashing success among youngsters. In a 1974 memo, an RJR official said the French campaign was "about as young as you can get, and aims right at the young adult smoker Camel needs to attract." Then, in a March 1985 memo, RJR official James S. Carpenter noted that the French Funny Camel print ad and T-shirt campaign using a cartoon camel had been designed to "youthen the brand."

In 1984 and 1985, RJR tested the Joe Camel image against other possible ads in focus groups of young adults age 18 to 24. According to an RJR market research report on Feb. 1, 1985, the focus groups found that the earlier French Camel ads "were well-received due to the fun/humor aspects. . . . The main drawbacks" include that "they may be appealing to an even younger age group."

In March 1985, RJR test-marketed the Joe Camel image in the United States by giving away T-shirts and lighters. It was a booming success, said an internal RJR "White Paper" in 1986.

In 1987, RJR's Canadian subsidiary commissioned a detailed study, called "Youth Target 1987," on the smoking patterns of 15- to 24-year-olds. It was undertaken, one 1987 internal document said, to prompt "better decision-making in regard to products and the programs directed at youth." The report divided these youth into seven categories, including "Quiet Conformers," "Tomorrow's Leaders" and "Insecure Moralists," and studied which types responded to what imagery and were most likely to smoke. It found that another classification, called the "TGIF Group," which likes "heavy metal and hard rock," was the most likely to smoke.

The Joe Camel campaign was launched in this country only months later, and soon depicted the character wearing a leather jacket, shooting pool and listening to a band called the "Hard Pack."

In the papers, company executives frequently said ads must play on young people's susceptibility to peer pressure. On March 12, 1986, the co-developer of the Joe Camel campaign, Rick T. Caufield, wrote an "RJR Secret" memo to RJR marketing officials saying the planned Joe Camel campaign would use "peer acceptance/influence" to "motivate the target audience to take up cigarettes." The goal is "convincing target smokers that by selecting Camel as their usual brand they will project an image that will enhance their acceptance among their peers."

In a "confidential" December 1990 report, RJR's ad agency, Young & Rubicam, noted that while RJR historically has been "substantially underdeveloped" in the 18 to 34 market, the "introduction of Joe provided the first evidence" that Camel could grow in that segment. "The subsequent evolution of Joe continues to build the brand's vitality."

RJR focused its Joe Camel print ad budget on magazines appealing to youth, such as Rolling Stone, Spin, Details, Glamour, Redbook, Sports Illustrated and Car and Driver. An August 1988 memo describes a key part of the Joe Camel campaign, involving outdoor ads placed where youth congregate. The ideal location, it said, is "wherever younger adult smokers hang out," including rock concert halls, near fast-food restaurants and convenience stores, video game arcades, city basketball courts and record stores.

Lawmakers and analysts predict rough going for the proposed national settlement in light of the revelations.

They "will make anyone on the Hill who tries to help the industry look like the son of Satan," said industry analyst Mary Aronson.

Sen. Kent Conrad (D-N.D.) called the revelations "devastating," adding that they would strengthen the push for a tougher deal, including higher penalties for the industry if it fails to curb underage smoking.

Sen. John McCain (R-Ariz.) raised the specter that the Senate may deal only with the youth smoking aspects of the deal and leave the rest to be resolved in the courts or through individual state settlements.

"I find these documents and the actions they represent pretty disgusting," said Waxman, a persistent foe of the industry in Congress. "These documents show they were targeting our children. . . . At the level of CEO and the board, they were implementing this strategy."

Meanwhile, Washington lawyer John Coale, who helped negotiate the national settlement, said the revelations only underscore the need to "do something about teen smoking." The proposed deal is a "workable solution" that would "raise the price of cigarettes and stop advertising to kids," he said.

"Do we spend another year or two to punish the tobacco industry?" asked Richard Scrugg, a Mississippi lawyer and another of the deal's architects. "Or do we get this deal done?"

Staff writers John Schwartz, Ceci Connolly and Roberto Suro contributed to this report.

© Copyright 1998 The Washington Post Company

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