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Marlboro friday — wikipedia, the free encyclopedia

Marlboro Friday refers to April 2, 1993, when Philip Morris announced a 20% price cut to their Marlboro cigarettes to fight back against generic competitors, which were increasingly eating into their market share.

As a result, Philip Morris’s stock fell 26%, and the share value of other branded consumer product companies, including Coca Cola and RJR Nabisco, fell as well. The broad index fell 1.98% that day. Fortune magazine deemed Marlboro Friday «the day the Marlboro Man fell off his horse.» 1 for Philip Morris Investors interpreted the price slash as an admission of defeat from the Marlboro brand, that Philip Morris could no longer justify its higher price tag and now had to compete with generic brands.

Since the Marlboro man was an image that stood since 1954, it was considered one of the biggest marketing icons, investors reasoned that to see the Marlboro icon give in to a price war, the marketing itself must be ineffective. As a result of plummeting stock value in major American brands, 1993 marked a slight decrease in U.S. ad expenditures.

It was the only decrease to occur since 1970. At the time, this event was regarded as signifying «the death of a brand» and the advent of a «value minded» consumer generation who pay more attention to the real value of products and not the brand names. This view soon proved to be incorrect, with the rest of the decade’s economy being dominated by brands and driven by high budget marketing campaigns citation needed .

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