History of Advertising No 97: The Marlboro Man's horse
Fortune came up with the most graphic comment on the seismic events of 2 April 1993 that rocked the marketing world to its foundations. It was, the magazine declared, "the day the Marlboro Man fell off his horse".
Things you need to know
- Miles quit Philip Morris a year after Marlboro Friday as stockholders demanded a better performance from the company. He died aged 74 in November last year.
- A little more than a year after Marlboro Friday, the brand not only recovered but surpassed the market share it had before announcing the price cut.
- In what was dubbed Tide Thursday, P&G opted to avert destabilising a declining market in May 2009 by not making price cuts and even increasing the prices of some brands.
What since became known as Marlboro Friday was the day when serious questions began being raised about whether this signified the "death of the brand".
The creation of Leo Burnett, the Marlboro Man embodied the seeming invincibility of Marlboro, a premium-priced cigarette brand that outsold its competitors by almost three times.
But with Marlboro under pressure from cheaper brands, its parent, Philip Morris, went for broke. On that fateful Friday, Michael Miles, the company’s chief executive and a former Leo Burnett senior executive, slashed the price of Marlboro by a record 20 per cent.
Miles’ assurance that the Marlboro brand would remain fully underpinned by advertising in order to regain market share failed to stop the resulting mayhem.
The first victim was the share price of Philip Morris USA, which immediately fell 26 per cent, causing a loss of $10 billion in a day.
Investors, worried that premium brands could no longer sustain their pricing, also sold off their shares in other consumer-products manufacturers such as Procter & Gamble, Quaker, Heinz and Coca-Cola. The Dow Jones Industrial Average fell 68.63 points.
Today, many experts believe Marlboro Friday changed the dynamics of consumer marketing forever. While people are still willing to pay for premium brands, branding has evolved beyond just advertising and into new ways of communication between brand owners and their customers.
This article was first published on campaignlive.co.uk
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