Big Tobacco Tries to Don A New Look: Are You Buying?

ig Tobacco wants to reclaim the hearts and wallets of most adult Americans by rebranding its tarred image — pitching “smokeless” e-cigarettes, embracing the mantra “harm reduction,” and funding science that could turn tobacco plants into life-saving medicine. That tactical shift, not surprisingly, has cultivated cynics like anti-tobacco crusader Patrick Reynolds, grandson of R.J. Reynolds, who calls the moves mere “window-dressing PR campaigns."

Even at Reynolds American Inc. (RAI) — maker of Camel cigarettes online and creator of the slogan “transforming tobacco” — spokesman Rob Dunham admits the strategy is “not without its challenges; there’s a lot of history to overcome.”

But amid perhaps the most ambitious image makeover in corporate history, Reynolds American’s new direction got a timely boost Tuesday. Its recently acquired subsidiary, Kentucky BioProcessing (KBP), emerged as a key player in developing emergency Ebola treatments used on two American missionaries. The medium to produce that medical breakthrough: tobacco plants.

“We embarked on a transformation agenda that, at its heart, is envisioning a tobacco industry that, at some point in the not-too-distant future, looks very different than the one we see today — or the one we’ve seen historically,” Dunham said.

“I’m not sure we would use the word 'rebranding.' The only reason I would balk at that (word) is it almost suggests we’re trying to somehow re-position as a PR exercise to get people to think differently,” Dunham added. “This is at the very core of our business strategy.”

At Reynolds American, top planks in that platform include “our commitment to reduce the harm caused by cigarette smoking,” curbing youth tobacco use, and “migrating historical cigarette smokers to other forms of tobacco that have the potential for far less risk,” Dunham said.

For RAI — and for its top competitor, Philip Morris USA — much of that migration is toward the industry’s fastest rising niche: electronic cigarettes. The battery-operated vaporizers deliver inhaled nicotine without the tar and combustion of traditional cigarettes. Some Wall Street analysts predict e-cigs alone may eclipse the traditional cigarette market within the next 10 years.