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WINSTON-SALEM, N.C. — A year after adding the Newport brand to its cigarette lineup, Reynolds American Inc. (RAI) is looking to grow its reach with young-adult smokers.
According to the Wall Street Journal, this summer the tobacco company gave out coupons for $1 off a pack of Newport cigarettes. The vouchers were distributed at concerts, bars and convenience stores and have been part of a push by RAI to target young-adult smokers and boost Newport sales.
RAI added Newport to its portfolio as a result of its 2015 acquisition of Lorillard Inc. Newport, which accounted for almost all of Lorillard's $7 billion in sales in 2014, has been the only major brand consistently gaining share of the shrinking cigarette market over the past decade, the report added.
A part of the campaign includes the Newport Pleasure Lounge, a mobile, air-conditioned trailer that has been popping at events like the three-day Rock USA festival in Oshkosh, Wis., this summer.
The lounges are open only to smokers over 21 years old. A brand representative, typically in a Newport-green shirt, checks IDs and turns away nonsmokers.
A Reynolds spokesman said the company exclusively targets smokers because it believes no one should start smoking. Instead, it aims to increase its 35-percent share of 40 million American smokers with its brands like Camel and Pall Mall.
A former executive who worked on Newport told the news outlet that RAI has earmarked about $50 million this year to promote the brand at events and bars. It also is selling the brand through a 2,300-person sales force — nearly double the size of Lorillard's.
Shay Mustafa, Newport's vice president of brand marketing, declined to comment on marketing expenses but said this is the first time in at least 15 years Newport representatives are directly engaging consumers.
Reynolds American Inc., based in Winston-Salem, is the parent company of R.J. Reynolds Tobacco Co., Santa Fe Natural Tobacco Co. Inc., American Snuff Co. LLC, Niconovum USA Inc., Niconovum AB, R.J. Reynolds Vapor Co. and RAI Innovations Co. Its brands include Newport, Camel, Pall Mall, Natural American Spirit, Grizzly, VUSE and ZONNIC.