In the opening episode of the award-winning American drama, Mad Men, an advertising executive is faced with a conundrum. It is 1960 and the US government has just prohibited cigarette companies from running ads that promote their product as healthy. Worse, articles are starting to appear in the mainstream media that say cigarettes actually kill you.
For the remainder of the episode the executive bites his pen and tosses scraps of paper into a bin, seemingly at a loss as to how to promote his client’s Lucky Strikes in the new ad-unfriendly environment.
China’s tobacco business is now going through its own ‘Mad Men’ moment. The government has followed the rest of the world in banning cigarette advertising in newspapers, magazines and on television and radio (and may be on the verge of insisting cigarette packs carry graphic warning symbols – as they do in many other countries).
Billboards are now under threat too, with Shanghai lawmakers banning an ad erected by Chung Hua, a cigarette brand. The brand had gotten round the advertising prohibition by running billboards that urge people to “Love China” and feature an image of Tiananmen Square.
How does this constitute a ‘covert’ cigarette ad? Wo Chung Hua, means ‘Love China’, but since it is also the name of the cigarette brand, it could be interpreted as ‘love our cigarette’ too. The China Daily observed that the billboard even warned: “Smoking can damage your health.”
Shanghai Tobacco Corporation, the brand’s owner, has said that the slogan promotes patriotism and is therefore a public service campaign. Not so, says Li Ming, a deputy to the Shanghai People’s Congress. “All advertising related to tobacco must be banned in line with the law,” he says.
Shanghai appears to be taking the lead against smoking. In efforts to conform with international norms ahead of the 2010 World Expo, it has extended smoking bans to all indoor areas – defined as places with ‘at least three walls and a ceiling’. That means workplaces.
This is a serious attack on one of the nation’s biggest industries – and worryingly for the tobacco firms it is happening in the nation’s commercial capital. China is the world’s biggest tobacco market with a customer base of 350 million smokers puffing around 1.7 trillion cigarettes per year. To put that in perspective, if you laid those cigarettes side-by-side in a giant chain, it would circle the earth 425 times. China accounts for roughly 30% of the world’s cigarette consumption (a quick visit to any Chinese karaoke bar will confirm this statistic).
The industry itself is a somewhat complicated affair. China Tobacco is the state’s monopoly tobacconist, and markets around 900 brands of its own. But it also allows manufacturers in local markets to make cigarettes and then pay it a fee for the right to sell them through its distribution network. Meanwhile foreign cigarettes make up only 3% of the local market.
Caijing magazine reports that Rmb60 billion ($8.76 billion) will be spent this year on cigarette marketing in China. Big tobacco has also become cleverer in marketing itself in China – in spite of the restrictions placed on advertising. The brand Hongtashan (Red Pagoda Hill) has, for example, branded itself through a climbing club it sponsors; and Hongta Classic has some very prominent product placement in TV shows. Meanwhile, a virtual army of ‘cigarette’ girls patrol bars and nightclubs, giving out samples.
But if Shanghai signals a trend, the nicotine-peddlers should be worried. The city’s three year campaign aims to stamp out passive smoking. The goal is for all restaurants, hotels and entertainment venues to be smoke-free, according to the China Daily.
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