SECTOR REPORT: PACKAGED GOODS: Tobacco Road
Brown & Williamson works the mails to push product, build loyalty
CIGARETTE GIANT Brown & Williamson Tobacco Corp., already a heavy user of direct marketing, has begun to rely on it even more. And why not? Faced with increasing restrictions on advertising, shrinking markets and cutthroat competition, the $5.4 billion firm has realized it’s got to reach consumers as subtly as possible.
The Louisville, KY-based company is using DM to help launch a filtered variety of Pall Mall cigarettes and to shore up slower selling brands through BWT Direct LLC, a catalog sales subsidiary formed last fall. The unit is conducting one of the largest mailing efforts B&W has made to date. And in the fourth quarter, BWT Direct will add a Web site to its marketing mix.
On the whole, direct marketing isn’t always the easiest undertaking for packaged goods marketers, which typically lack access to sales transaction data, says Dan Davidson, former director of the strategic target-marketing group at CheckMark, Ralston Purina’s St. Louis-based marketing communications unit. But even so, packaged goods makers can still employ direct and database marketing to promote customer loyalty. Like Ralston, B&W doesn’t have a great deal of transaction data from retailers and doesn’t rely much on loyalty clubs, says B&W spokesman Steve Kottak.
This month the tobacco firm plans to send out 6.5 million direct mail pieces to people who prefer cigarettes that burn slowly and, it says, provide more value for one’s money. Targets for this large-scale mailing come from the firm’s database, estimated by some industry observers to contain more than 20 million names. The list is compiled from sources such as calls into company phone lines, respondents to direct mailings and other sources, says division vice president Paul Wessel. The rollout of filtered Pall Malls follows a four-month test in Alaska.
The mailing piece is a 6-inch-by-9-inch black self-mailer with the headline,
