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International Marketing 10th Edition by Michael Czinkota, Michael Brumbach, Ilkka Ronkainen
Edition 10ISBN: 978-1285687162International Marketing 10th Edition by Michael Czinkota, Michael Brumbach, Ilkka Ronkainen
Edition 10ISBN: 978-1285687162 Exercise 4
Marketing Tobacco and Alcohol to Consumers in Developing Economies
Sales of cigarettes and other tobacco products have declined in the advanced economies in recent decades. Today, only 20 percent of consumers in the United States smoke, down from more than 50 percent in the 1950s. As people in advanced economies learned about smoking's harmful health effects, tobacco companies such as Philip Morris and British American Tobacco increased their marketing efforts in developing economies. In China, for example, 60 percent of all men smoke. A pack of cigarettes sells for $2, even though most Chinese earn less than $600 per month. In Russia, where 70 percent of men smoke, the average lifespan is 65 years.
Global tobacco firms oppose efforts to print warnings on cigarette packages. In developing economies, smoking bans or antismoking activism are rare. Most people endure severe poverty and know little about smoking's link to ailments like cancer. At the same time, however, life in poor countries is hard, and smoking is one of few pleasures that people enjoy. Governments also benefit from the tax revenue they receive from cigarette sales.
Another group that earns big profits in developing economies is the global beer, wine, and liquor industry, typified by companies such as Diageo and Constellation Brands. In much of Africa and Latin America, for example, multinational liquor firms use persuasive advertising to attract consumers to their brands. Ads are often designed to link drinking alcohol with virility, sexual success, or high-class lifestyles. Companies place alcohol billboards in front of schools and playgrounds. Advertising often depicts images and music that appeal to teenagers. Some global alcohol firms use cartoons to market their products on television in Africa. Much research points to excessive alcohol usage as a key predictor of poverty. At the same time, just as with smoking, drinking is one of life's few pleasures in much of the developing world.
What steps should be taken, if any, to ensure social responsibility in the marketing of tobacco and alcohol in developing economies?
Sales of cigarettes and other tobacco products have declined in the advanced economies in recent decades. Today, only 20 percent of consumers in the United States smoke, down from more than 50 percent in the 1950s. As people in advanced economies learned about smoking's harmful health effects, tobacco companies such as Philip Morris and British American Tobacco increased their marketing efforts in developing economies. In China, for example, 60 percent of all men smoke. A pack of cigarettes sells for $2, even though most Chinese earn less than $600 per month. In Russia, where 70 percent of men smoke, the average lifespan is 65 years.
Global tobacco firms oppose efforts to print warnings on cigarette packages. In developing economies, smoking bans or antismoking activism are rare. Most people endure severe poverty and know little about smoking's link to ailments like cancer. At the same time, however, life in poor countries is hard, and smoking is one of few pleasures that people enjoy. Governments also benefit from the tax revenue they receive from cigarette sales.
Another group that earns big profits in developing economies is the global beer, wine, and liquor industry, typified by companies such as Diageo and Constellation Brands. In much of Africa and Latin America, for example, multinational liquor firms use persuasive advertising to attract consumers to their brands. Ads are often designed to link drinking alcohol with virility, sexual success, or high-class lifestyles. Companies place alcohol billboards in front of schools and playgrounds. Advertising often depicts images and music that appeal to teenagers. Some global alcohol firms use cartoons to market their products on television in Africa. Much research points to excessive alcohol usage as a key predictor of poverty. At the same time, just as with smoking, drinking is one of life's few pleasures in much of the developing world.
What steps should be taken, if any, to ensure social responsibility in the marketing of tobacco and alcohol in developing economies?
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International Marketing 10th Edition by Michael Czinkota, Michael Brumbach, Ilkka Ronkainen
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