The choice of discount brand cigarettes: a compa… [tob control. 2014] — pubmed — ncbi

BACKGROUND

Increasing tobacco taxes to increase price is a proven tobacco control measure. This article investigates how smokers respond to tax and price increases in their choice of discount brand cigarettes versus premium brands.

OBJECTIVE

To estimate how increase in the tax rate can affect smokers’ choice of discount brands versus premium brands.

METHODS

Using data from International Tobacco Control surveys in Canada and the USA, a logit model was constructed to estimate the probability of choosing discount brand cigarettes in response to its price changes relative to premium brands, controlling for individual specific demographic and socioeconomic characteristics and regional effects. The self reported price of an individual smoker is used in a random effects regression model to impute price and to construct the price ratio for discount and premium brands for each smoker, which is used in the logit model.

FINDINGS

An increase in the ratio of price of discount brand cigarettes to the price of premium brands by 0.1 is associated with a decrease in the probability of choosing discount brands by 0.08 in Canada. No significant effect is observed in case of the USA.

CONCLUSIONS

The results of the model explain two phenomena (1) the widened price differential between premium and discount brand cigarettes contributed to the increased share of discount brand cigarettes in Canada in contrast to a relatively steady share in the USA during 2002 2005 and (2) increasing the price ratio of discount brands to premium brands which occurs with an increase in specific excise tax may lead to upward shifting from discount to premium brands rather than to downward shifting. These results underscore the significance of studying the effectiveness of tax increases in reducing overall tobacco consumption, particularly for specific excise taxes.

Cigarettes brand evolution — tobaccotoday

Cigarette packaging is no exception. In the case of cigarettes, however, packaging is even more critical for several reasons. Firstly, unlike many other products where the packaging is discarded after opening, smokers generally retain the cigarette pack until the cigarettes are used and keep the pack close by or on their person. Thus, cigarette packs are constantly being taken out and opened, as well as being left on public display during use. this high degree of social visibility leads cigarettes to be known as badge products . A cigarette package designer, john digianni, states a cigarette package is part of a smoker’s clothing, and when he saunters into a bar and plunks it down, he makes a statement about himself. When a user displays a badge product, this is witnessed by others, providing a living testimonial endorsement of the user on behalf of that brand and product.

Cigarette brands enjoy the highest brand loyalty of all consumer products, with less than 10% changing brands annually. brand choices are usually made early during the life of a smoker, with a high concordance between the brand first smoked and the brand eventually selected as a usual brand. Thus, once a consumer embraces a cigarette brand, it is quite unlikely that they will change. When there is less opportunity to establish brand imagery through traditional methods of advertising, as is increasingly becoming the case as advertising restrictions come into force, packaging plays a more important role in establishing and driving brand image.

The primary job of the package is to create a desire to purchase and try. to do this, it must look new and different enough to attract the attention of the consumer menthol cigarettes, slims cigarettes. What roles do colour, pack size, and pack construction, for example, play in influencing potential consumers especially starter smokers, but also other subgroups of consumers to select one brand over another? What role does packaging play to maintain brand choice against increasing concerns about smoking health risks? Traditionally, the primary function of a package was to simply contain and protect the product. However, factors such as increased competition and clutter on the retail store shelf have meant that for most products, packaging must perform many sales tasks, such as attracting attention, describing the product, and helping to make the sale. the often cited

How to modify the standard product as cigarettes? Vandermeulen advises to look around more attentive. It has become his habit when visiting supermarket to study any novelties, trace change of demand in car industry, sale of expensive clothes and even jewellery. And BAT and competing tobacco Companies have already produced cigarettes with triple carbon filter, to make cigarettes without it would be a mistake. R&D department had to elaborate technology that allows inserting modern filter in thinner cigarettes. Manufacturing process had to be prepared as well to buy expensive equipment. In December 2007 when Kent Nanotek was the only representative of new class cigarettes this format took 0.5 per cent of tobacco market according to Nielsen data. From that times appeared 17 brands in this category Winston XS from JTI, Marlboro from Philip Morris and so on. This segment has increased up to 3 per cent, 1.2 per cent of it takes earliest explorer Kent Nanotek.

This year Kent brand has launched cigarettes Kent Convertibles, which’s flavor can be changed by pressing on filter, inside the filter is menthol capsule. Vandermeulen has got involved to elaboration of this product on design stage but he is very proud of it, he says that Convertibles realize «tendency to customizing». «If you really wish to create something innovative, you have to trace changes in society. Our actions are dictated by consumers’ requests and this is the only right policy. If looking only on competitors there are no chances to invent something new» Vandermeulen says.

The most common place a cigarette can be purchased is in a corner convenience store. However, cigarettes can be found in vending machines, airport duty free shops which allow people to purchase cartons exempt of taxes, and even on ships that sail to international waters to circumvent tax laws. The tag price for a pack of cigarettes may appear to be relatively inexpensive. However, the real hook involves the chemical properties contained in the cigarette particularly that of nicotine. This ingredient has proven to be physically addictive and keeps the consumer purchasing pack after pack. When cigarette companies acquire a new customer often they have a customer for life. The case of mascot Joe Camel is just another example of how marketing ad campaigns change over the years, sometimes by choice due to changing consumer demands, and sometimes the burden brought forth by a successful marketing campaign may be more then a company can handle, as in the case of Joe Camel.