WASHINGTON -- Public health organizations have long attacked the tobacco industry, despite its producing a currently legal product, while retailers selling tobacco have been their secondary target. Now that attack on retailing is heating up.
According to a scathing new report savaging the convenience retailing industry by anti-tobacco groups Campaign for Tobacco-Free Kids and Counter Tobacco, as well as the American Heart Association, "tobacco companies have enlisted convenience stores as their most important partners in marketing tobacco products and fighting policies that reduce tobacco use, thereby enticing kids to use tobacco and harming the nation's health."
The report, "Deadly Alliance: How Tobacco Companies & Convenience Stores Partner to Market Tobacco Products & Fight Life-Saving Policies," calls on elected officials to adopt policies--especially higher tobacco taxes--that reduce tobacco use and counter the influence of point-of-sale (POS) marketing. It calls higher tobacco taxes a "win-win-win for states--a health win that reduces smoking, especially among kids; a financial win that produces significant new revenue; and a policy win that polls show is strongly supported by voters across the country."
It does not address how the groups' goal of a declining numbers of smokers paying higher taxes, which the groups admit are designed to curtail the very activity being taxed, would sustain that new revenue. Nor does it discuss how the tax burden would affect smokers of varying economic situations.
Nontax approaches to raising cigarette prices proposed by the groups include:
- Imposing strong tobacco product minimum price laws.
- Prohibiting price discounting/multipack offers.
- Increasing retailer licensing fees.
- Imposing "sunshine laws" to require tobacco companies to disclose the amount of money they provide to retailers and others.
[Editor's Note: CSP Daily News does not endorse the opinions, assertions, conclusions or recommendations found in the anti-tobacco groups' report.]
The report claims that as other forms of tobacco marketing have been restricted, tobacco companies now spend more than 90% of their marketing budget--nearly $10 billion a year--to saturate convenience stores, gas stations and other retail outlets. Tobacco companies pay stores billions to ensure that cigarettes and other tobacco products are advertised heavily, displayed prominently and priced "cheaply" to appeal to both kids and current tobacco users, it also claims.
Despite current high cigarette prices that would seem to prove otherwise, to back up its allegation of cheap pricing, the report insists that "direct payments to retailers, incentives, coupons and other pricing strategies" offset tax increases enough to "make tobacco products more affordable for kids and low-income smokers."
At the same time, according to the groups, c-stores have become essential partners with--and "front groups" for--the tobacco industry in fighting higher tobacco taxes and other public policies that reduce tobacco use.
"The result of this alliance is more kids smoking, fewer adults quitting, more tobacco-related death and disease, and higher health care costs for everyone," the report states. "In short, the tobacco industry and its convenience store allies are making a killing by making deadly and addictive tobacco products all too convenient."
The report claims:
- C-stores and other retail outlets have become by far the dominant channel for marketing tobacco products in the United States. Since the November 1998 legal settlement between the states and the tobacco companies restricted some forms of tobacco marketing, tobacco companies have significantly increased both the total amount and the percentage of their marketing budgets spent at the point of sale. In the first 10 years after the settlement (1999 to 2008), tobacco manufacturers spent more than $110 billion--92% of their total marketing expenditures--to advertise and promote cigarettes and smokeless tobacco products in the retail environment, according to the latest tobacco marketing reports issued by the Federal Trade Commission (FTC).
- Tobacco marketing in stores entices kids to smoke and use other tobacco products, discourages current tobacco users from quitting, targets minority communities and portrays deadly tobacco products as appealing and acceptable, according to the report.
- Point-of-sale marketing is very effective at reaching kids and influencing them to smoke, the report claims. With tobacco ads prohibited on television, radio and billboards and less frequent in magazines, c-stores remain one place where kids are regularly exposed to tobacco advertising and promotions. More than two-thirds of teenagers visit a c-store at least once a week. Studies have found that cigarette marketing is more prevalent in stores where adolescents shop frequently; tobacco advertisements and product displays are often placed at kids' eye level or near candy; and POS marketing--especially price discounting–increases youth smoking.
"Despite their claims to have changed, tobacco companies continue to bombard kids with messages encouraging them to smoke, and convenience stores have become their most important partner in doing so," said Matthew L. Myers, president of the Campaign for Tobacco-Free Kids. "It is critical that elected officials reject the influence of these special interests and take action to protect our nation's children and health instead."
Kurt M. Ribisl, director of the Counter Tobacco project and associate professor in the Department of Health Behavior at the University of North Carolina Gillings School of Global Public Health, said, "This report exposes how tobacco companies enlist retailers to advertise and promote their deadly products. As a result of this alliance, stores are now the major channel where they lure youth with colorful advertisements and entice current smokers with aggressive price promotions. This report is a wakeup call that states need to be focusing on the point of sale to combat these harmful industry practices."
The report added, "Tobacco companies, inhibited by their own negative reputations, have also enlisted convenience stores as front groups to oppose tobacco tax increases and other policies to reduce tobacco use. Convenience stores have fought cigarette tax increases despite considerable evidence that the retail economy does not suffer as a result."
Among the many contentious claims made by the report: "Tobacco companies and convenience stores overstate the harm to retailers caused by tobacco control policies. Research shows that convenience stores are not affected by tobacco control policies--including tobacco tax increases--to the extent that they and the tobacco industry claim. Recent studies have found that the number of convenience stores does not decline after cigarette tax increases, and neither does overall tobacco retail employment. People who quit or cut back on tobacco purchases will still spend their money on other products. In addition, retailers recognize the declining trend in tobacco sales, which means they can and have made adjustments to compensate."
Click here to view the full report and slideshow.
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