Marlboro Friday What it Means Lessons FAQs

Marlboro Friday: What it Means, Lessons, FAQs

Marlboro Friday refers to a significant day in the history of Philip Morris, the maker of Marlboro cigarettes. On April 2, 1993, the company drastically cut the price of Marlboro cigarettes to compete with generic brands. The announcement resulted in a massive drop in the company’s stock, wiping out billions from its market capitalization in a single day. However, two years later, the stock fully recovered.

Key Takeaways:

– Marlboro Friday is a significant day in the history of Philip Morris.

– On April 2, 1993, Philip Morris slashed the price of Marlboro cigarettes to compete with generic brands.

– The announcement wiped $10 billion off Philip Morris’ market cap as analysts called an end to the era where big-name brands can name their price.

– Wall Street’s lack of faith in iconic U.S. brands proved unfounded as the call to slash prices eventually helped it to price competitors out of the market.

– The announcement and its aftermath served as a lesson for corporations, which began moving their emphasis from advertising to branding.

Understanding Marlboro Friday:

The recession of the early 1990s made consumers more price-conscious, leading to the popularity of generic brands. Philip Morris responded by cutting the price of Marlboro by nearly 20% to regain market share from deep discount cigarettes. This event became known as Marlboro Friday. Investors panicked and dumped holdings in branded consumer goods, causing the company’s stock to plummet 26% and wiping $10 billion off its market cap. However, other big-name brands were also affected. Wall Street’s lack of faith in these brands was proven wrong as Philip Morris recovered.

Special Considerations:

Philip Morris’ revival was credited to the strength of its brands and customers’ loyalty. The Marlboro Man remained entrenched in smokers’ minds despite the inability of tobacco companies to advertise. Philip Morris USA is a subsidiary of Altria Group, while Philip Morris International is a holding company headquartered in New York.

Branding, Advertising, and Lessons Learned:

Marlboro Friday served as a valuable lesson for the corporate world. The rise of generic brands led to a shift from advertising to branding. Major brands continue to dominate the market, selling their products alongside generics. Through strategic planning, companies can create brand images that resonate with consumers.

How Many Cigarettes Does Philip Morris Make in a Year?

Philip Morris produces 700 billion cigarettes each year in 38 different facilities worldwide, with the capacity to produce as many as 20,000 cigarettes per minute.

What Are the Most Expensive Cigarettes in the World?

The most expensive cigarette brand in the world is Treasurer Luxury Black, costing about $67 for a pack of 20 cigarettes.

When Was Marlboro Friday?

Marlboro Friday occurred on April 2, 1993.

Does Marlboro Still Use the Marlboro Man in Advertising?

Cigarette companies can no longer advertise in the United States, so Marlboro had to discontinue using the Marlboro Man. However, he remains an iconic image in marketing.