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Tuesday, August 12, 2014

Philip Morris and Its Products

At Philip Morris — maker of Marlboro Silver — executives haven’t crafted a slick slogan to accompany a new business direction. But rebranding is part of the corporate DNA. Today, Philip Morris operates under the parent company Altria Group, Inc. The name Altria is rooted in the Latin word for “high.”

Altria’s latest products similarly reflect an evolving marketplace — during the last 50 years, cigarette consumption has been cut in half. In 2013, Altria launched its first e-cig, MarkTen, and expanded Verve, a chewable nicotine disc. Its website is sprinkled with language signaling a different approach, including a vow to “address societal expectations” and a promise to connect “adults who have decided to quit smoking with information to help them.”

“We believe that, given our deep experience in the largest categories today, we truly understand what adult tobacco consumers are looking for,” said Altria spokesman Bill Phelps. “So we've communicated publicly that we have a strategy to grow new income streams with innovative products that meet those adult consumer preferences.”

Along with that shift, Altria has supported giving the U.S. Food and Drug Administration the authority to regulate tobacco products, Phelps said. In April, the FDA proposed asserting its jurisdiction over new tobacco products such as e-cigarettes and nicotine gels.

“Our companies are focused on developing lower-risk products that would appeal to adult tobacco consumers,” Phelps said. “And we think that’s an important opportunity under this FDA regulation.”

But after five decades of federal health warnings, heart-breaking tales from dying ex-smokers, and hefty civil penalties against cigarette makers for causing wrongful deaths, talk of “harm reduction” and “lower-risk products” has plenty of skeptics.

“Business transformation is like open-heart surgery — you’ve got to crack the ribs and remove some organs. It depends how serious they are,” said Dean Crutchfield, a New York-based brand consultant. His past clients include BP, PepsiCo and McDonald’s.


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