Youth Awareness of Tobacco Sponsorship as a Dimension of Brand Equity

Abstract

Introduction This paper reports findings from a study that examined the effects of tobacco sponsorship on cigarette brand familiarity in a market segment of 14-year-olds in New Zealand. The objective of the paper is to clarify issues concerning the reach and effects of tobacco sponsorship in under-age markets, and to help inform sport managers, sponsors and policy makers about these issues. A conceptual framework is developed for treating sponsorship-derived brand awareness as a component of brand equity. This is intended to help explain how tobacco sponsorship communications can build brand market value by associating the sponsoring brand(s) in the minds of their target populations (in this case a youth segment) with particular kinds of sports, sport events and personalities (Aaker, 1991, 1996; Keller, 1993). The market rationale for building cigarette brand awareness among youth is that they are the principal group that initiates smoking. Even though smoking uptake occurs at different rates in different national settings, youth are universally the population that starts smoking and the population most at risk (Nath, 1982; US Department of Health and Human Services, 1994; Roemer, 1993; Pan American Health Organization, 1992; Toxic Substances Board, 1989). European figures, for example, indicate that 90% of adults smoking today started in their teens, 60% of them before the age of 14 (BASP, 1991). During smoking uptake, starters tend to consume the brands most readily available. Once a smoking habit is achieved, however, smokers become more brand-loyal. Industry figures indicate that ten per cent or less of committed smokers switch brands in any given year, with many switching to a lighter version of the same brand. In European markets, cigarettes have 66% overall brand loyalty, the highest of any product category (BASP, 1991). Building brand awareness among youth is a matter of strategic importance for the tobacco industry. The market value that is realized by converting starters into loyal customers can be expressed using standard loyalty measures of recency, frequency, and lifetime customer value (Stone, 1997). A single pack per day habit means that a brand-loyal smoker will reliably purchase a pack each day, every day, for as long as he or she smokes. Over ten years this amounts to 3,650 pack-purchases. Most smokers need to raise their nicotine doses to maintain the same levels of stimulation, and smoking rates initially tend to increase with age. A loyal, heavy smoker (two to three packs/day) would yield 21,900 to 32,850 pack-purchases of a brand over 30 years of smoking. This sort of loyalty value begins by cornering the awareness market of youth and achieving brand saliency and use among starters. To make the transition from experimentation to regular use, a brand must also have the right image for the target market--typically of independence and social sophistication for most youth as well as a sufficiently strong nicotine content to signify maturity (McCracken, 1992). Sponsorship and Cigarette Brand Equity Tobacco companies have experienced restricted access to advertising media over the last two decades as a result of growing prohibitions internationally, but sponsorship restrictions have lagged behind, leaving sponsorship as a medium of choice for reaching targeted consumer groups. Of 98 countries with tobacco control legislation today, 88 have regulations that restrict advertising, while only 26 have regulations limiting or prohibiting tobacco sponsorship. Tobacco companies have made good use of this legislative imbalance and are among the largest investors in sport and event sponsorship globally (Sparks, 1997b). Despite industry claims that sponsorship does not cause people to smoke, it is doubtful that tobacco investment in sponsorship has no social consequences. A parsimonious and heuristic way of representing the effects of cigarette sponsorship is in terms of its contribution to the sponsoring brand's image and awareness among youth. …