Rothmans sees market share slip

Abstract

PurposeThe purpose of this paper is to examine the factors contributing to the historic loss of market share experienced by Rothmans Benson & Hedges (RBH), Canada's second largest tobacco firm.Design/methodology/approachThe paper presents a case study of the marketing of RBH flagship cigarette brand Rothmans between 1957 and 2000, comparing its performance with brands owned by market leader Imperial Tobacco Canada Ltd (ITL).FindingsSometimes it is no fun at all being a marketer. You have a generous advertising budget, follow the rules of strategic brand management, make sure your brand communications are consistent with the historical brand identity – and yet your market share declines. Take the case of RBH – historically Canada's second‐largest seller of cigarettes – which saw its market share slide from 43 percent in 1975 to a mere 17 percent by the mid‐1990s. It does not help of course if the government decides to introduce regulations restricting where and how you can advertise, but other tobacco firms seemed to adapt more successfully, gaining ground in key consumer segments. What went wrong for Rothmans?Practical implicationsThe paper highlights the importance of contemporary references and imagery in enabling a brand to keep pace with changes in the target market.Social implicationsThe paper shows how legislation intended to restrict product advertising can have unintended consequences as firms use creative marketing to exploit loopholes in regulation.Originality/valueThe paper draws on internal corporate documents made public through tobacco industry legal challenges to Canada's Tobacco Products Control Act (TPCA), in addition to trade press and promotional material.