Cigarette sales get a boost from TV commercials for e-cigs, says study

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Discovery of "spillover effect" may provide new ammunition for calls for regulatory oversight

It’s been nearly 50 years since Congress banned cigarette commercials from the airwaves. But a new study suggests the rapid proliferation of e-cigarette commercials may be lifting the sales of cigarettes, too, offering an unexpected path back to TV for the tobacco industry.

According to the study, Advertising, Habit Formation and U.S. Tobacco Product Demand, funded by the U.S. Food and Drug Administration, TV advertisements for e-cigarettes create a "spillover effect" that also increases demand for cigarettes. "If you increase e-cigarette advertisement, then cigarette demand is going to increase slightly," said Yuqing Zheng, an agricultural economist the University of Kentucky and lead author of the study.

Researchers compared advertising data from Kantar Media with point-of-sale data at outlets that sold five different kinds of tobacco or nicotine products between 2009 and 2013. What they found was that for every increase in e-cigarette advertising on television, there was an accompanying lift — however small — of cigarette sales.

That rise in cigarette sales is small but statistically significant: one-one hundredth of 1% whenever e-cigarette advertising doubles. But e-cigarette advertising increased 17-fold between 2011 and 2014, so it could be contributing to tens of millions of dollars in cigarette sales.

Though the FDA has petitioned for regulatory control of the e-cigarette market, there are currently no restrictions on e-cigarette advertising, the bulk of which take the form of TV commercials. The findings of the study, which was published in the American Journal of Agricultural Economics, could renew calls for e-such oversight, said the authors. "Such results may lend support to those who advocate that more regulations on e-cigarette marketing are needed," they wrote.

The study found that the spillover effect was restricted to TV. E-cigarette magazine ads did not have the same positive effect on cigarette sales. "We consistently find that TV advertising is the most effective way to enhance demand," said Zheng.

Why e-cigarette ads increase cigarette demand is unclear, though Zheng speculated there could be an "umbrella" effect at work. "A lot of the cigarette and e-cigarette brands belong to the same parent company, so when you do advertise for e-cigarettes, it’s probably going to enhance the image of the parent company which owns the cigarette brand, so that might stimulate some cigarette smoking as well," he said. Intentionally or not, cigarette manufacturers may have found a way to boost sales by advertising a different product in their inventories.

These could be problematic numbers for e-cigarette manufacturers, who have been resisting calls for the regulation of either their products or their advertising. If further research supports the study’s finding that e-cigarette advertising increases cigarette sales, then continuing to allow unregulated e-cigarette advertising "might undermine the efforts to reduce cigarette smoking," the study said. "If a new policy were to prohibit e-cigarette television ads, similar to what is imposed for cigarettes, the model predicts a small drop in consumer demand for e-cigarettes, and a minor decrease in cigarette demand."

Whether the prospect of that minor decrease helps anti-smoking advocates win regulatory controls for e-cigarettes and their ads remains to be seen.