Select Committee on Health Minutes of Evidence

Amber Leaf Briefing: November 1997 (submitted by M&C Saatchi)



  Introduction of 50g new design from January 1998.

  Introduction of 25g pack from April 1998.

  Free papers available (boxed) from April 1998.

Duty Free

  Promotions, probably March/April/May using free tin "kit"?


  Trial through bootleggers and Duty Free.

  UK promotion/direct mail.

  Packaging Changes.



  UK Distribution.

  Adoption by bootleggers.

  Awareness and trial.

  Brand Positioning.

  Gaining share of Duty Paid.

  Not chosen by bootleggers.

  Product liked by GV smokers.

  New packaging next month.


  Halt Gallaher share decline.

  Weaken Imperial's profitability.


  Shift in emphasis required.

  Old Holborn losing share.

  Amber Leaf potential.

  NPD for 18-24s.


  Forthcoming legislation regarding the advertising of tobacco products will virtually wipe-out the opportunity for tobacco manufacturers to promote their products. As a consequence of the impending legislation, the relationship between tobacco manufacturers and independent store-holders has increased in importance. The effectiveness of customer communications will, in the near future, be highly dependent upon the strength of relationship between manufacturer and store-holder.

  Against this backdrop, Cognition has conducted research amongst independent retailers in order to inform the development of Gallaher's communications with independent retailers. The global objective of this research is to aid the optimisation of these communications, as a step toward maximising sell through the independent sector.


  These can be summarised as:

  1.  To identify perceptions of Gallaher in terms of broad corporate profile and how this is communicated/reflected through direct marketing, specifically with the aim of enhancing brand advocacy.

  2.  To understand the reaction of the independent sector to direct marketing generally from manufacturers—specifically direct mail and telephone communication—in order to pinpoint detailed issues of best/preferred practise from the recipient's point of view.

  3.  To evaluate perceptions of Gallaher's direct marketing, specifically direct mail and telephone. Particularly, in comparison with that of other tobacco companies, as well as other manufacturers.

  4.  To investigate reaction to examples of Gallaher direct marketing in order to identify details of best practise.

  5.  To evaluate the contrast between face-to-face and indirect communications. Particularly with reference to both:

    —  Grade C customers, in terms of assessing the role of direct marketing as a substitute for sales visits.

    —  Grade A customers, for whom the direct marketing is a support for sales force activity.

  6.  To identify opportunities and lessons that can be taken from manufactures in other categories in terms of direct marketing.

  7.  To investigate the rols of trade marketing activities in Cash and Carry.


  Gallaher's approach to contact and communications, from the point of view of the independent retailer, focuses too much on:

    —  Admonishment—the policing of the gantry.

    —  Hard selling of new products—which independent retailers believe are often inappropriate for their customer base.

    —  Interference with the way the retailer wants to arrange things in his/her own store.

  Independent retailers would prefer the emphasis to be on:

    —  Incentivising them to buy more Gallaher product.

    —  Helping them sell Gallaher brands in terms of practical guidance rather than interference.

    —  Feeling valued by Gallaher through appropriate forms of contact—where possible with a single contact with whom they can develop a long term relationship in which exchange, gift-giving and promise making and keeping take their place.

  Direct mail can make an important contribution in all these areas with a single document communication (along the lines of the Gallaher Gazette). Indeed in terms of specifics we would recommend that the Gazette's role be expanded to be more along the lines of a trade press publication.

  The material included should also be subject to the filter of satisfying of the first four levels indentified below:






  The key issues to take out are that such a document would:

    —  Be more likely to be retained. Thus the information within it internalised as part of a retailer being a brand advocate.

    —  Generate a greater stand out for Gallaher direct mail versus the mass of other material received.

    —  Indirectly increase Gallaher corporate profile and reconfirm them as a "blue chip" player.

    —  May go some way towards addressing a sense of loss that some might be experiencing in terms of on-going contact.

  Whilst such a communication would be an effective and valued form of contact with retailers it would be most effective as part of a coherent contact and communications strategy which included both telephone and face-to-face visits. The case of retailers who had had in-house sales force contact withdrawn is illustrative.

  Considered as a strategic manoeuvre, and in so far as it has succeeded in making cost savings for Gallaher, the withdrawal of in-house sale reps from a number of independent retailers can be considered a success: the retailers continue to "revere" and sell on the Gallaher brands whilst requiring less input from Gallaher to achieve this loyalty. The only negative impact of the change has been an emotional one: that of loyal retailers feeling they have been abandoned and feeling that their relationship with Gallher has suffered. In particular many now feel the loss of a relationship in which facilitates gift-giving and promise making and keeping, feeling that this has been replaced either by nothing or by inconsistent and unpredictable contact.

  The optimum contact strategy with independent retailers would probably involve the following components:

    —  Regular direct mail meeting the specification outlined above.

    —  Less frequent (perhaps quarterly) face-to-face contact with a single individual focusing on incentivisation, emotional relationship building, gift giving etc.

    —  Telephone contact preferably with the main sales coantact—to follow up action points from visits, keep the relationship warm and allude to the next visit etc. and/or

    —  Discreet mystery shopping to police the gantry.

  The telephone contact could also be conducted by a single "call centre" contact other than the face-to-face sales contact but it is imperative that this contact is co-ordinated within Gallaher through some form of contact management system to ensure consistency and predictability in the relationship from the perspective of the retailer.



  Both Scotland (index 90 despite Kensitas) and Wales (87) are slightly weak areas for Gallaher.

  Current movement towards devolution provokes strong nationalistic sentiment.

  Opportunity for nationalistic (but not jingoistic) cigarette seems to exist).

  May extend to areas of England as well—Yorkshire, Cornwall, London.


  18-24s are a key target and a problem area for Gallaher.

  198 is intended to attack this area, but not with a specific student focus, more with an urban venturer feel.

  Several areas of potential could be investigated for students:

    —  commodity, no frills brand (discussed above);

    —  brand available only on campus;

    —  retro, kitsch styling, tapping into 60s/70s/80s style nostalgia (Abba, Jo Bogie etc).


  Smoking remains marginally female in profile, a bias which is slightly increasing (1989-52.2/47.7, March 1997—53.9/46.1).

  Women are heavier smokers of certain niche brands, but there are none which are overtly female in attitude and approach.

  Gallaher, through Silk Cut and Berkeley, has a strong female franchise.

  Opportunity possibly exists for overtly female targeted cigarette, (perhaps tapping into female cigar smoking trend?)

  Difficult to market, but a niche not yet filled.


  Gallaher is strong amongst 18-34s and 18-24s (although declining, hence 198).

  However, amongst 18-24s Gallaher is stronger amongst women (44 per cent m/o penetration) than men (36 per cent).

  In addition, anecdotal evidence is that existing Gallaher brands lack "maleness" appeal vs (eg) Regal, Embassy and L&B.

  198 is intended to address credibility issue among all 18-24s, but is not intended to be overtly male.

  Opportunity exists, therefore, for a male targeted brand, perhaps co-branded with Loaded or with scantily clad women on the cigarette paper!

Brainstorm began by remembering famous and memorable "big" promotions over the years:

  BA's "Go for it America": on one random day, every seat on every BA flight was to be given away free.

  Microsoft paid for the print run of The Times on the day Windows95 launched.

  Pepsi painted lots of things blue (inc Concorde) the day they launched the new blue can.

Next, ideas for specific Gallaher "Big Bang" promotions were brainstormed, in three broad areas:


  Golden Cigarettes inside packs, creating millionaires across the country.

  Passport to The World: collect coupons (possibly with specific countries on them) to construct your own travel plans.

  Free flight in Space.

  Win a tropical island.

  Offer the chance to dive down to see Titanic.

  Every pack of cigarettes is guaranteed to win a prize. All smaller prizes could be branded, and linked to smoking: lighters, ashtrays, cigarette cases, rolling machines, perhaps even scissors for Silk Cut.

  Offer the opportunity to have something named after each of the winners.

  Win your weight in gold, or sovereigns.

  Create a new millionaire every month for the next 25 years.

  Pay off lots of mortgages.

  Every single smoker in the country gets a holiday if they collect enough tokens available in Gallaher packs (enough tokens to equal four weeks worth of smoking, promoting brand switching and loyalty, as well as creating a big event).


  Organise the Millennium for people, giving each winner their dream celebration, or arranging a party in every town.

  Or, a few select winners get flown out to a Pacific island to see in the Millennium first.

  Buy the QE2 when it is decommissioned, for one large party, attended by competition winners.

  Perhaps rally hugely against the ban: encouraging those who smoke to fight for their right to enjoy themselves and their freedom, sponsoring National Smoking Day, getting the ban front of mind.

  Sponsored bars and pubs (Gold Bar for B&H . . .), especially good as an escape for when even other bars begin to become no-smoking environments.

  Encourage smokers to go out for a night on the tiles and send Gallaher the bill.

  Arrange a high-profile festival in Hyde Park, giving away tickets in packs of cigarettes.


  Creat nation-wide building projects—giving something back to the community.

  Sponsored parks in urban areas (Benches and Hedges).

  Vouchers in packs to pay for the tax on your next pack.

  Smokers of Gallaher brands get a free pint in any branch of a big pub chain. Possibility of some sort of membership/loyalty scheme.

  Pay for branded smoking rooms in otherwise no-smoking offices—opportunity to make them feel luxurious and special as a reward for smokers.

  Likewise, invest in a rail franchise and run smoking trains (even use old steam engines).

  If your car doesn't have a cigarette lighter, Gallaher will pay for one to be installed for you.

  Sponsor Gay Pride. (If at same time as Ad Ban, use the slogan "Rights for Fags"?)

  Pay pavement artists to draw ambient ads for Gallaher brands. (And buskers to sing about them?)


  Organise a Smokers' Demo is Hyde Park before the Ad Ban comes into effect.

  Advertise and market products in well-known holiday destinations where the ban has no jurisdiction: Balearic Islands, Amsterdam, Florida etc.

  Advertise using billboards on the outside of foreign embassies in UK (this is not UK territory so should not be affected by the ban).

  Start a cool pirate radio station a la Radio Carolina, running (amongst others) radio ads for Gallaher brands.

  Project logos of all Gallaher brands onto the ground from the sky late one night, all over the country. This would be especially effective on New Year's Eve.

  Begin using the Internet as an advertising medium.

  Issue special coins in packs, collectable before the ban is in place, redeemable against packs of cigarettes once the ban is in place.

  Organise screenings of uncut films.

  Silk Cut to sponsor Elastoplast.

  First ads in space/projected onto the moon.

  Hire a large high-profile (possibly by railway line, or in view of big hotel, or near a festival) and plant purple flowers in shape of Silk Cut mortice.




  To heighten awareness of the implications of a communications ban amongst opinion formers and smokers in order to put pressure on the Government to reduce the severity of the ban ie save direct marketing, point of sale and promotions.

  We need a rallying cry in order to mobilise opinion formers and smokers into action.

Possible Routes

  1.  Undermine Jowell, position her as the Minister of Bans, undemocratic and rash/hasty decisions. Undermine other supporters eg Branson (cite connections with Rizla/Virgin).

  2.  Claim the right to a voice: berate the Government for not allowing Tobacco companies a say.

  3.  Arm smokers and opinion formers with the facts eg £9 billion pa in cigarette tax versus £625 million pa spent on Health, evidence proving that ad bans do not reduce consumption, smokers have to sign a document saying they are 18 before they receive anything from their brand.

  4.  Fly the flag for freedom of speech. Put forward a campaign against censorship and pro freedom of speech. Domino theory—who's next?

  5.  Inform smokers of what the ban will mean in real terms to them. Eg No free gift promotions, white "own label" packaging, no coupon collection schemes, no brand relationship whatsoever.

  6.  Underground campaign to present the other side of the argument to journalists and influential contacts.


Ads for Opinion formers, PR for smokers/consumers.


  Research concepts first.

  Pre or post White paper?

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