Reynolds launches campaign to push smokeless product

R.J. Reynolds Tobacco Co. is attempting to make lemonade out of the outdoor smoking ban that begins Monday in New York City.

The company is launching a major advertising campaign for Camel Snus next week in hopes of getting smokers to try the smokeless product “and reclaim the world’s greatest city.”

Reynolds is the first large U.S. tobacco company to encourage smokers to quit smoking by urging them to switch to a smokeless product, said Bill Godshall, the executive director of SmokeFree Pennsylvania. The ads do not make any claims of reduced health risks with a potential switch.

The New York City law is considered one of the largest outdoor smoking bans in the country. There also are bans affecting Los Angeles city parks and Chicago parks with playgrounds. The goal in each instance is reducing second-hand smoke.

New York City violators could be subjected to a fine of up to $100 for each instance by the city’s parks department, but police will not enforce the ban.

Two ads will run in the New York Daily News, New York Post, Newsday and some New York weeklies, as well as nationally in USA Today and Wall Street Journal. The New York Times does not take tobacco ads, Reynolds spokesman David Howard said.

One ad features the image of a flame holder with the tagline “NYC Smokers: Enjoy freedom without the flame.” The other ad is in the shape of the Empire State Building with the tagline “NYC Smokers: Rise above the ban.” Both ads feature health warnings.

“We thought this was a good opportunity to communicate with adult smokers in New York City, and across the country, to inform them of a smoke-free, spit-free tobacco option they might want to consider switching to,” Howard said.

The campaign also includes point-of-sale advertising, interaction with age-verified and certified adult tobacco consumers, messages on packs and an age-restricted website.

“Camel is transforming to meet demand from adult tobacco consumers, as well as societal changes,” Howard said. “We wanted to raise awareness of another tobacco product that doesn’t produce second-hand smoke.”

Since Reynolds agreed to participate in the landmark 1998 Master Settlement Agreement that restricted its advertising options, the company has tried to walk a fine line in marketing to young adults.

As expected, the Camel Snus campaign drew criticism from anti-tobacco advocates.

“These ads continue Reynolds’ irresponsible marketing of snus as a way for smokers to get their nicotine fix in the growing number of smoke-free places,” said Vince Willmore, a spokesman for the Campaign for Tobacco-Free Kids.

“The goal is to discourage smokers from taking the one step that would truly protect their health, which is to quit entirely. Once again, Reynolds is putting its bottom line ahead of public health.

“It’s also deeply offensive Reynolds is using iconic New York City images to market a harmful and addictive products, especially in a city that is a global leader in fighting tobacco use,” Willmore said.

Reynolds has not run cigarette ads in newspapers and consumer magazine in 3½ years.

But it has been aggressive with its Camel Snus advertising, including in magazines such as Entertainment Weekly, People, Sports Illustrated, Time and US Weekly, as well as free and alternative publications.

The New York City campaign also is Reynolds’ latest attempt to connect its brands with specific geographic regions and landmarks.

For example, Reynolds conducted a 10-week “Break free adventure” marketing campaign from November through January that had participants guess which trendy destinations the Camel mascot was visiting before coming home to Winston-Salem. Destinations included Austin, Texas; Brooklyn, N.Y.; New Orleans; Las Vegas; San Francisco; Seattle; and Sturgis, S.D.

Anti-smoking groups and health and government officials protested the campaign for using well-known images of the destinations behind the Camel logo. Reynolds distributed packs bearing the images nationally in December and January.

“The Camel advertising is simultaneously both pragmatic — it is concerned with practical consequence — and yet an auger for the slow but steady change in tobacco-use habits,” said Stephen Pope, an industry analyst and the managing partner of Spotlight Ideas in England.

John Sweeney, the director of the sports-communication program at UNC Chapel Hill, said that the campaign may succeed in attracting new users among smokers.

“It will only get long-term success if it captures a loyal, enthusiastic following,” Sweeney said. “It will only do that if it provides a truly satisfying experience to the current smoker.”

Cheap Newport Cigarettes

Buy Cheap Newport (Menthol) KS (EU Made) Cigarettes online at the low prices. And save money - $100!

Buy Cigarettes Online by the carton.

Newport Menthol Cigarettes specifically for anyone who loves smoking Newport cigarettes. Newport, introduced in 1957, is a brand of menthol cigarettes produced by Lorillard Tobacco Company of Greensboro, North Carolina, United States. Newports comprise about 35 percent of menthol cigarette sales in the US. Newports have gained a commanding share of the African-American market; a 2005 survey stated that 49.5% of cigarette sales to African Americans were Newports. Newport cigarettes come in several varieties: Full Flavor, Medium, and Lights.
Buy Cheap Newport Cigarettes online today. Buy your Newports online and save big on your next carton and when you buy Newports in bulk you can save even more.

Roll your own, avoid tax; you make the smokes at local business

The big wood-paneled box at Discount Smokes is a tobacco-rolling machine. Into it go loose pipe tobacco and rolling tubes. With a rattling and

The RYO Filling Station machine processes pipe tobacco and rolling tubes into "smokes." Customers have to load the machine and start it.

grinding of gears, out of it come “smokes” – 190 guaranteed to fill a 200-count box and designed to match the flavor of popular cigarette brands.
The machine also is a number-cruncher. As it whirs and grates inside an East Wisconsin Street building that once housed an H&R Block office, it keeps out the state and federal excise taxes that go along with purchases of manufactured cigarettes.
For a carton purchased in Wisconsin right now, that’s an additional $35.21 past the base price: $2.52 per pack for the state and $1.01 per pack for the federal government. Instead of charging $60 or more for a brand-name carton, as convenience stores must, Discount Smokes offers a deal that results in a price of $29.99 a box.
The tax arithmetic at Discount Smokes, owned by Kirk Burnstad, Randy Heinzel and Lon Chester, all of Portage, depends greatly on careful attention to order of operations – but not parentheses, exponents, multiplication, division, addition and subtraction. The key is who does what.
“They manufacture the product. We don’t do it,” Burnstad said of customers.
“We sell them tubes. We sell them tobacco,” Heinzel said.
In mid-April, a first-time customer walked into Discount Smokes, and the owners walked him through the process, starting with picking the brand he wanted to match. Discount Smokes keeps two columned, plastic-covered pages posted on a wall. One column lists popular brands – Salem Full Flavor, Virginia Slim Light and Newport, for example – and other columns list the inputs. For Pall Mall Menthol Ultra Light, that’s 2 oz. Blue, 6 oz. Platinum and a menthol tube.
The owners next directed the customer to the tobacco bins and told him to weigh 8 ounces onto a small postal scale. A cassette of rolling tubes went into the machine, the tobacco went into a hopper, and the customer followed directions on a small screen. Every step of the way, the owners demonstrated and directed.
What they pointedly were not doing was any of the work themselves. If they did, the owners said, they’d be manufacturers. Instead, they sell materials and rent the use of the machine to customers in a package deal. Their caution extends to language. For legal reasons, they said, they identify the machine’s output as “smokes,” not “cigarettes.” The containers the “smokes” go into likewise are “boxes,” not “cartons.”
The machine started and immediately began filling tubes and otherwise processing raw materials. “Smokes” soon spit out of a dispenser, and the customer was packing a box. He said the box would last him a week. At that rate, it would save him about $120 a month in taxes.
How much does the machine cost, the customer asked.
“It’s pricey,” Chester said.
How many years before you get your investment back?
“Don’t know yet,” Chester said.
“Well, I’ll be letting my friends know,” the customer said as he walked out.
Rolling your own
Smokers have long “rolled their own” and avoided excise taxes. The machine at Discount Smokes takes the concept to a new level. It’s called an RYO Filling Station and is produced by a company of the same name in Girard, Ohio. RYO claims to have more than 1,000 of the machines in 35 states. At least 43 are within 250 miles of Portage, according to the company website, and the Discount Smokes partners said they know people in Reedsburg and Richland Center who planned to set up RYO stations. Tomah already has one.
“We’re the eighth machine in Wisconsin,” Burnstad said.
The machines use pipe tobacco, not roll-your-own tobacco. The step saves serious money: When the federal government raised tobacco taxes in 2009, it raised the roll-your-own tobacco tax from $1.09 per pound to $24.78 per pound but made the tax on pipe tobacco $2.8311 per pound.
RYO’s website advertises a typical return on investment of 300 percent in the first year of use and a margin of 20 percent to 30 percent per “carton,” as RYO describes the containers. The clear incentive for customers to use RYO machines is the promise of avoiding the federal and state excise taxes. Wisconsin’s tax is among the highest in the nation; neighboring Illinois, Minnesota and Iowa have taxes of $0.98, $1.56 and $1.36 per pack, respectively.
Government’s role
Governments have noticed the spread of commercial roll-your-own machines.
The Tobacco Tax Parity Act of 2010, introduced in the U.S. House of Representatives early last year, would have raised taxes on pipe tobacco to the same level as roll-your-own. It never got out of committee.
In October, the federal Alcohol and Tobacco Tax and Trade Bureau ruled that the rolling machines were being used for manufacturing and should be subject to taxes paid by name-brand tobacco manufacturers.
“The permit requirement is triggered by the manufacture of a cigarette by the commercial cigarette-making machine, which forms the tobacco into the roll and applies the cigarette paper or tube,” the bureau said in its ruling. “The permit requirement is triggered regardless of whether the person operating the machine, by inputting loose tobacco and cigarette tubes, is an employee of the retail establishment or the ultimate consumer of the cigarettes manufactured.”
Late last year, a federal judge in Ohio issued an injunction that prevented the bureau from carrying out its new policy, pending further court action.
On April 13, the New Hampshire Supreme Court heard arguments over a Brookline tobacco retailer’s roll-your-own machine. According to an Associated Press report, lawyers for the state argued that customers left the store with cigarettes that hadn’t existed before they walked in, making the store a manufacturer that should pay into the national fund meant to offset costs of tobacco-related illnesses.
Lawyers for the company, North of the Border, said only customers might be manufacturing cigarettes, not the store, since the customers are paying a fee to use the store’s machine, not buying cigarettes.
Stephanie Marquis, spokeswoman for Wisconsin’s Department of Revenue, said whether excise taxes apply to RYO machines hasn’t been determined but that the department and the state Department of Justice continually review laws to see if updates are needed.
“Those machines are fairly new,” she said. “It’s just an issue that’s beginning to crop up with states.”
Groups gather data
Ryan Sheahan, coordinator for the Tobacco Free Columbia-Dane County Coalition, said he wasn’t sure that the machines would increase the number of smokers but instead might only shift spending from name brands to stores that offer the machines.
The coalition promotes smoking cessation among youths and adults and the elimination of exposure to secondhand smoke, among other things. It conducts periodic compliance checks with tobacco sellers to test whether vendors will sell to youths, for example.
Sheahan said he was aware RYO machines have been moving into Wisconsin and other states. For now, he said, he’ll gather data and consider increasing education efforts toward lawmakers.
“It’s definitely an emerging market that we have to keep track of,” he said.
Before Discount Smokes’ first two weeks had passed, the owners said, they had had 130 runs.
One Discount Smokes customer, Stephanie Loufik of Rio, was described jokingly by Burnstad as “our favorite German customer.”
Loufik said she’d spend about $60 at Kwik Trip for the particular brands of Marlboros she wants, about twice what she pays for a box at Discount Smokes. She noted the particulars of the store’s process.
“You have the push the button as the customer,” she said.
Regardless, the owners said the process was fairly easy to master.
“I had an 82-year-old lady in here the other day,” Heinzel said. “No problem. She loved it.”
The finished products aren’t exactly Marlboros or Pall Malls. The owners said that’s advantageous in some ways. The smokes don’t have formaldehyde or plastics, they said.
“It’s all natural,” Burnstad said.
Heinzel said he switched to the RYO smokes and within a few weeks lost a bad hack. Chester said he doesn’t smoke.
“I’m not against it,” he said. “I just choose not to do it.”
Chester said the three plan to soon open Discount Smokes branches in Baraboo, Wisconsin Dells, Lake Delton and Columbus.