The “smokeless” cigarette developed by R. J. Reynolds Tobacco Co. at an estimated cost of more than $300 million has been at least temporarily dropped after five months of testing in several cities, company officials said Tuesday. Most smokers apparently did not like Premier’s taste or smell.
“Very simply, it did not perform as we hoped it would in the test market,” said David Fishel, senior vice president of public relations at R. J. Reynolds, a subsidiary of RJR Nabisco. That test market was limited mostly to the cities of Phoenix, Tucson, Ariz., and St. Louis.
However, the Winston-Salem, N. C., company has left open the option of some day reintroducing an improved version of the cigarette--which heats tobacco but does not actually burn it. “All we’re doing is discontinuing the test market,” Fishel said. “We may reintroduce it, or something like it, at another time.”
The Premier cigarette was designed to reduce smoke released into the air and appease the anti-smoking movement. But the product had the opposite effect, with health groups objecting to what they saw as an effort to make smoking more acceptable without addressing health concerns.
“Not only did the cigarette pose possible serious dangers to smokers, but to nonsmokers as well,” said John F. Banzhaf, executive director of the Washington-based consumer group, Action on Smoking & Health. “After all, it did not have any smoke, which is the one warning that ordinary cigarettes give to nonsmokers.”
Concern About Ads
The American Medical Assn. expressed delight at RJR’s move. “The American public has the right to expect that the products they consume have been judged safe for human consumption before being placed on shelves for sale,” AMA Executive Vice President James H. Sammons said in a statement. Last year, the AMA asked the U.S. Food and Drug Administration to ban sales of the cigarette.
“If they hadn’t pulled it off the market, there would have been a regulatory brouhaha,” said Dave Stewart, professor of marketing at USC. Stewart recently consulted with Federal Trade Commission officials who were concerned that advertisements that positioned Premier as a cigarette with a “cleaner smoke” were misleading.
Meanwhile, RJR--which makes the Winston, Salem and Camel brands--said it will continue to test-market two other unusual cigarettes that were introduced to a few cities in recent weeks. One, which is rolled in special paper and appears to emit less smoke than most other brands, is called Vantage Excel. The other, Chelsea, is said to have somewhat of a vanilla taste.
For RJR Nabisco, which earlier this month was acquired by the New York investment firm of Kohlberg Kravis Roberts & Co. for a record $25 billion, the move to drop Premier is viewed by some analysts as a setback. Just five months ago, RJR officials openly discussed spending more than $1 billion to roll out the brand nationally.
“Most analysts were expecting this,” said Sarah A. Sheckler, vice president at the Chicago investment firm Duff & Phelps Inc. “I’m a smoker. I tried it. And like most other people, I didn’t like the taste, either.”
Certainly RJR is not the first major company to face a setback with a new product line. In fact, marketing executives say that fewer than one in seven new products are successful. Coca-Cola was forced to put Classic Coke back on the shelves alongside its new formula after a consumer backlash. Even Procter & Gamble’s relatively new orange juice line, Citrus Hill, has not met the company’s expectations.
Some industry analysts even credit RJR for jumping out far ahead of the competition in its testing of new cigarette products. “It was a very bold experiment but it didn’t work,” said Lawrence Adelman, senior vice president at the New York investment firm Dean Witter Reynolds Inc. “Their failure could dissuade others from making it.”
“If RJR had been successful with Premier,” said USC marketing professor Stewart, “every manufacturer would have soon come out with a smokeless cigarette. This means it’s back to the drawing boards for all of them.”
Plenty to Say
But a spokesman for RJR’s chief rival, Philip Morris, denied that his company was preparing to market a smokeless cigarette. What is more, he declined to comment on the Premier brand. “Our policy is not to comment on RJR or anything that the competition does,” spokesman Steve Weiss said.
But Charles Crow had plenty to say about Premier.
Crow’s company, Grand Candy & Tobacco Co., is a big distributor of cigarettes in St. Louis, where Premier has been test-marketed. He delivered the cigarettes to retailers ranging from local tobacco shops to major grocery chains.
“It was evident to anyone who handled it that it was a loser from the word go,” Crow said. “I bet you that after that first week’s delivery, I didn’t have one reorder on the product.”
In fact, Crow says that he will soon be shipping back thousands of dollars worth of Premier cigarettes to RJR. “I never saw a cigarette that had so much consumer interest before it came out,” he said. “But I tell you, I tried the cigarette and it was terrible. It made me nauseous for the rest of the day.”