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When cigarette makers go green

Who would have guessed. The colour smokers find most repulsive is olive green.

Well, that’s the finding of researchers working for the Australian government which on Wednesday launched a bill aimed at banning any form of branding on cigarette packs.

Here’s a press release from Nicola Rixon, Australia’s Minister for Health and Ageing:

The Gillard Government’s world leading efforts to reduce the death and disease caused by smoking pushed ahead today with the introduction of the Tobacco Plain Packaging Bill into the Parliament.

“This world first initiative sends a clear message that the glamour is gone from smoking,” Minister for Health and Ageing Nicola Roxon said.

The legislation requires all tobacco sold in Australia to be sold in plain packs – with no industry logos, brand imagery, colours and promotional text. The only thing to distinguish one brand from another will be the brand and product name in a standard colour, standard position and standard font size and style. In addition, health warnings will be updated and increased from 30 per cent to 75 per cent of the front of the pack, as well as 90 per cent of the back.

For plain packs, read yucky olive green packs.

Unsurprisingly, tobacco companies are challenging the proposals on the grounds they infringe trademarks, but Gillard government is determined to get this bill into law by the start of 2012.

Now, that’s bad news for British American Tobacco, which controls 40 per cent of the Australian market, and Imperial Tobacco, which has a 16 per cent market share. But not because profits will take a bid hit. Australia is relatively small market for both companies – 8 per cent and 4 per cent of profits respectively.

The real worry, of course, is that other countries follow suit. The UK for example has said it will consult on the idea of plain packaging while the EU is due to give its verdict early next year.

However, would plain packaging really persuade many existing smokers to quit or even trade down? After all many smokers are accustomed to their brands’ taste.

The thing is however, they aren’t really making hardcore smokers like they used to, and there’s evidence that we’re well on the way to the turning point for cigarette companies where higher pricing can’t make up for lower volumes any longer.

Olive green, with a nasty streak of red.

Related link:
On the back of a (plain) fag packet – FT Alphaville

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