================================================================= SCARC ACTION ALERT -- October 13, 1995 FTC Reports Record Increase in Cigarette Advertising and Promotion ================================================================= "The tobacco industry spends over $6 billion each year on advertising. What proportion of this is targeted at children? One billion? Two billion? Six billion?" Joe DiFranza, MD, in a letter to FTC Chairman Robert Pitofsky, May 15, 1995. ***************************************************************** SUMMARY ***************************************************************** The latest report on tobacco consumption, sales, and promotion from the Federal Trade Commission (FTC) shows that cigarette companies spent a record $6.03 billion on cigarette advertising and promotion in 1993, a 15.4 percent increase over 1992 spending. Information from the FTC report can be a valuable tool in the effort to support the Food and Drug Administration's (FDA) proposal to reduce tobacco use by youth, which includes restrictions on tobacco advertising. Publicizing the increased spending on "specialty items" -- t-shirts, hats, cameras, flashlights, and the like, can highlight the fact that the tobacco industry targets children. Specialty items bearing tobacco logos would be prohibited under the proposed FDA regulations, which are designed to reduce youth access to tobacco products and the appeal of tobacco advertising to children. (For more information on the proposed FDA regulations, see SCARC Action Alerts "FDA Moves to Regulate Tobacco Products; PM Launches Youth Plan," 7/24/95, "President Clinton's Proposed Regulation of Tobacco Comes Under Attack from the Industry," 8/18/95, and "FDA Debate Continues," 10/13/95.) Tobacco spending on newspaper, magazine, transit, and outdoor advertising all declined in percentage of total advertising expenditures during 1993, while promotions and point-of-sale advertising increased. Cigarette companies spent $756 million on the distribution of specialty items in 1993, an increase of more than $416 million from 1992. This accounted for 12.5 percent of total advertising and promotional expenditures for 1993. These specialty items are distributed primarily by mail, at promotional events, and through catalogue orders -- rather than at point of sale with the purchase of cigarettes. Thus, there is no way to consistently ensure that these products are limited to adults. The report also indicates that the six major cigarette manufacturers sold 461.4 billion cigarettes in the U.S. in 1993, 45 billion fewer than they sold in 1992. This is an 8.9 percent decrease in sales, and represents the largest decline in cigarette sales in the last 30 years. Cigarette sales in the U.S. rose steadily from 1963 through 1981, with the exceptions of 1964 and 1969. Annual cigarette sales have declined for the most part since 1981. Per capita cigarette consumption by adults dropped 9.8 percent, from 2,675 in 1992 to 2,414 in 1993. Per capita consumption has been on the decline in the U.S. since 1973. The FTC is required by the 1967 Federal Cigarette Labeling and Advertising Act to submit annual reports to Congress summarizing tobacco sales, consumption, and advertising and promotional activities. TOBACCO INDUSTRY ADVERTISING EXPENDITURES (in thousands of dollars) Type of Advertising 1992 % of total 1993 % of total Newspapers $35,467 .7 $36,204 .6 Magazines 237,061 4.5 235,195 3.9 Outdoor 295,657 5.7 231,450 3.8 Transit 53,293 1.0 39,113 .6 Point of Sale 366,036 7.0 400,909 6.6 Promotional Allowances 1,514,026. 28.9 1,557,505 25.8 Sampling Distribution 49,315 .9 40,190 .7 Specialty Item Dist'n 339,997 6.5 775,761 12.5 Public Entertainment 89,739 1.7 84,275 1.4 Direct Mail 34,345 .7 31,463 .5 Coupons* 2,175,373 41.6 2,559,170 42.4 TOTAL ** 5,231,917 100.0 6,034,915 100.0 * This category includes Endorsements/Testimonials, Coupons and Retail Value Added. ** Due to rounding of figures, sums of percentages may not equal 100 percent. ***************************************************************** OBJECTIVES ***************************************************************** 1) To publicize the increasing amounts of money tobacco companies spend on specialty items and point-of-sale promotion. 2) To use the information in the FTC report to support the proposed FDA regulation of tobacco products. ***************************************************************** USEFUL QUOTES ***************************************************************** "There is no question that seductive advertising that glamorizes those who smoke is an important factor in recruiting young smokers." NEW YORK TIMES, August 11, 1995, p. A28. "The industry has targeted the youth market in its advertising . . . denials ring hollow in the face of an obvious strategy." NEWS AND OBSERVER, Raleigh, North Carolina, August 14, 1995. "There is enough business out there to take the place of tobacco if these regulations should ever go through." Chris Carr, of advertising firm Gannett Outdoor, commenting on the possible impact of the regulations on billboards, ADVERTISING AGE, August 14, 1995, p. 8. "The industry's future lies in continuing somehow to hoodwink the young and foolish into thinking tobacco makes them sexy or glamorous. The research is clear that people who make it to adulthood without puffing or dipping are poor pigeons for these predators." Robert Garrett, LOUISVILLE COURIER-JOURNAL, August 13, 1995, p. D1. ***************************************************************** SUGGESTED ACTIONS ***************************************************************** 1. Mobilize local groups such as Girl Scout or Boy Scout troops or church groups to send comments supporting the proposed regulations to the Food and Drug Administration during the public comment period. Comments don't need to be lengthy or technical, but supportive comments from the public must be received if the FDA is to finalize the regulations in their most effective form. The public comment period has been extended and will now close January 2, 1996. Send comments to: Dockets Management Branch (HFA-305), Docket Number 95N-0253, Food and Drug Administration, Room 1-23, 12420 Parklawn Drive, Rockville, MD 20857. 2. Incorporate information on industry advertising expenditures into your other activities supporting the proposed FDA regulations to bolster your argument on the need for advertising restrictions. 3. Write a letter to the editor of your local paper publicizing the fact that tobacco industry spending on promotion has increased dramatically, and express your support for the proposed FDA regulations. ================================================================= Produced by: Smoking Control Advocacy Resource Center (SCARC) Address: Advocacy Institute 1707 L Street, NW., Suite 400 Washington, DC 20036 Tel: 202-659-8475, Fax: 202-659-8484 E-mail AI0001@ADVINST.ORG =================================================================