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Advertising / economics

Through advertising and promotion, the tobacco industry targets 1.63 million new smokers a year to compensate for those who quit or die.
Tobacco companies deduct the cost of advertising and promotion from their taxes as a business expense, which saves them in excess of $1 billion dollars a year.

In 1997 tobacco companies spent almost $5.7 billion dollars to promote and advertise their products. This represents an increase in spending of almost 16 times since 1970, when advertising on radio and television was banned. While tobacco products have been mass-produced and marketed for decades, it has taken many years for their deadly effects to be scientifically documented. The tobacco industry is the second largest advertiser in the print media, including magazines and newspapers, and the largest advertiser on billboards. Sports Illustrated, a magazine that celebrates athletic achievements and has the highest youth readership, contained the highest number of pages per year for tobacco ads. For the year '98-'99, the number of pages of tobacco ads increased 11 percent (2.9 to 3.2) per issue. Advertising and promotion for tobacco products are often misleading and deceptive. Tobacco advertising and promotion project images of smoking as fun, glamorous, macho, youthful, and most insidiously, healthful.

United States cigarette exports have increased due to aggressive marketing by tobacco companies and expanding foreign markets. An April 1997 report published by the United States Department of Agriculture estimates that US cigarette exports for 1996 rose 5.5 percent to 244 billion pieces and exports of manufactured leaf increased 5 percent to 486 million pounds. It also reported that US tobacco net exports have increased from about 2.1 billion in 1986 to 5.3 billion in 1996. US cigarette exports to Japan have also increased about 942 percent from 6.5 billion in 1985 to an estimated 67.7 billion in 1996. Exports to countries that formerly comprised the Soviet Union have more than tripled from 4.6 billion in 1991 to an estimated 19.4 billion in 1996. Marlboro (Philip Morris) was the leading cigarette brand sold outside the American Market in 1994 at 260 billion. Mild Seven (Japan Tobacco) came in second at 127 billion and Winston (J.R. Reynolds) was third at 54 billion.

Economic implications of tobacco

The cost of tobacco to our society is best measured by the number of people who die or suffer illness because of its use. No statistic can express the devastation of pain and suffering caused by tobacco. The tobacco industry is however, one of the most profitable businesses in the country; in 1998 tobacco manufacturers' revenue was $50 billion. Nevertheless, the costs of smoking are far higher than the income from cigarette sales. Tobacco use drains the economy of more than $100 billion dollars in health care costs and lost productivity. This does not include costs associated with diseases caused by environmental tobacco smoke, burn care resulting from cigarette smoking-related fires, or perinatal care for low birth weight infants of mothers who smoke. Health care expenditures caused directly by smoking totaled $50 billion in 1993, according to the Centers for Disease Control and Prevention. Forty-three percent of these costs were paid by government funds, including Medicaid and Medicare. Tobacco costs Medicare more than $10 billion dollars and Medicaid more than $5 billion dollars per year. A decade ago, lost economic productivity caused by smoking cost the US economy $47.2 billion dollars in 1990, according to the Office of Technology Assessment. Adjusted for inflation, the total economic cost of smoking is more than $100 billion dollars per year at the present time. Even though smokers die younger than the average American, over the course of their lives, current and former smokers who have quit, generate an estimated $501 billion dollars in excess health care costs. On average, each cigarette pack sold costs Americans more than $3.90 in additional smoking related expenses.