RJ Reynolds: We Spent $350M And Ended Up With A Turd With A Tip.

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RJ Reynolds: We Spent $350M And Ended Up With A Turd With A Tip.

This entry is part 4 of 4 in the series The Biggest Product Flops in History

“We spent 350 million dollars, and we ended up with a turd with a tip”.

Premier. The lighter way to get a buzz.

In 1988, RJ Reynolds decided to launch a new brand of cigarettes in the United States called Premier, a smoker’s answer to Virginia Slims. It was a time in America when smoking in the office and flying on aeroplanes were commonplace. Smokers needed a product to replace their cigarettes, and Premier fit the bill. Premier was a brand of cigarettes for the very finest people. If you had it, you didn’t smoke it; you just looked like you did. The smokeless cigarettes were sold in black packets to echo their exclusiveness and intended as a less unhealthy replacement for standard cigarettes.

There were doubts from inside the company and outside about whether the smokeless cigarette functioned sufficiently in delivering nicotine to the body. Anti- Drug campaigners also scorned the product, making huge light that the product could be used to deliver class A drugs to the body and nicotine.

Premier was taken off the market in 1989, less than a year after its launch and cost RJ Reynolds over $300 million to develop. Its total costs are estimated to be $800 million to $1 billion! But why take something down that cost the business so much?

Ultimately the product never achieved the popularity the company intended. Users said that the product had a nasty aftertaste and complained that it smelt and tasted like farts! Even though it looked like a standard cigarette, the product still required instructions on lighting it.

RJR worked to the risk theory that smokers would become addicted to the taste of Premier after purchasing two or three packets. In reality, the majority of users only smoked one cigarette before sharing the rest with others.

The smokeless cigarette worked by the heating and aerosolising of the tobacco as opposed to burning it.  Therefore, the Premier Smokeless Cigarette was a device that separated the combustible material from the aerosol-generating material. This resulted in an inhaled product comprising Glycerol and water rather than the burning products, nicotine and smoke ingredients.

The prominent flavour was tobacco; however additional flavours were introduced, such as raspberry and chocolate. These additional flavours were supposed to give rise to a “pleasing aroma” in the smoke.

The additional flavour options were the primary reason that Premier failed in the market. The additional flavours of raspberry and chocolate were very different from the typical taste of a cigarette.

The Premier promised that the government would help smokers kick the butt, but the new smoke-free cigarette was less satisfying. The Premier’s real issue was that smokers didn’t enjoy using the smoke-free cigarette and couldn’t see the need for it. Obviously, for non-smokers, there was no reason to use this product anyway. In a nutshell, RJ Reynolds had launched a product for which there was no real market. After four months of prolonged sales, the company cut its losses, and the Premier smokeless cigarette was withdrawn from the market.

But they weren’t ready to give up! By mid-1900, smoking came into the spotlight as a considerable concern, which convinced the company that there was finally a market for smokeless cigarettes. After spending millions in the development of their first smokeless cigarette, the company then went on to continue splashing out. In 1996 it spent a further $125 million on vamping up its efforts and this time came out with a product called Eclipse.

They made a point to focus on second-hand smoke and the annoyance it was to many smokers and non-smokers.

However, compared to the ultra-low tar cigarettes currently on the market, the Eclipse smokeless cigarette showed that it contained much higher levels of toxic substances!

When this information was found, it was highly damaging to the Eclipse brand, as you can imagine. The Eclipse product had been pitched to the marketplace on account of its health credentials, and it even stated on its original advertising campaign that, ‘The best choice for smokers who worry about their health is to quit. But Eclipse is the next best choice for those who have decided to continue smoking.’

The US Health Authorities made a huge public outcry on the product; however, it became apparent that the real reason Eclipse had failed was because users didn’t see the need or have the desire for a smokeless cigarette.

The very idea of a smokeless cigarette suggests it should target people who don’t especially enjoy smoking. From this, we can see the obvious flaw in the thinking at RJ Reynolds. They quickly found themselves desperately trying to create a winning product intended to be successful with people who would never want it. Going with the logic here- the people who don’t like the smell of smoke are probably not the ideal audience for a tobacco product!

In conclusion, if you realise that there is no market for your product, it’s probably sensible not to launch a revised version of it in the hope of there now being a market that you already know doesn’t exist!

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