BAT share price: Tobacco giant launches TV ad campaign

Equities

Company promotes its e-cigarette brand Vype

iNVEZZ.com, Tuesday, February 18: British American Tobacco Plc (LON:BATS) became the first tobacco company in decades to launch a TV commercial in the UK.

Taking advantage of a regulatory loophole, the company last night aired a 30-second spot promoting its Vype brand of e-cigarettes. The tobacco giant had to make a subtle change to its slogan in order to avoid smoker references in the commercial.

In today’s trading, BAT shares were up 0.14 percent at 3,113.00p, as of 13:02 UTC. The stock has lost more than four percent of its value so far this year.

‘Vapers’

The British American Tobacco commercial broadcast last night shows a man and woman running through a city at night before jumping in slow-motion through a wall of vapour, a reference to the mist emitted by the increasingly popular electronic cigarettes and portable vaping devices.

Television ads promoting cigarettes were banned in Britain in the 1960s and a ban on commercials for other tobacco products, including cigars, followed in the early 1990s. However, the current advertising rules were not designed with e-cigarettes in mind, as acknowledged by the UK’s Advertising Standard Authority. This regulatory gap afforded British American Tobacco an opportunity to launch a TV advertising campaign for its e-cigarette brand Vype. And to make sure that the commercial doesn’t contain any reference to smoking, the company has tweaked the strapline for the ad.

The online advertisements for Vype use the strapline “pure satisfaction for smokers”, but in the TV advert, British American Tobacco has replaced the word ‘smokers’ with the term ‘vapers’ to describe people that use its e-cigarette product.

E-cigarettes

British American Tobacco is one of the big tobacco companies attempting to use e-cigarettes as a way to offset the decline in the tobacco industry. Tobacco volumes are falling across the industry, with tougher government regulations and increased health awareness of consumers curbing the number of smokers. E-cigarettes, which are perceived as less harmful than regular cigarettes, have grown in popularity, with the global e-cigarette market now valued at an estimated $3 billion, according to Panmure Gordon analyst Damian McNeela.

However, the devices have been criticised by health campaigners, who say that e-cigarettes can act as a gateway to nicotine addiction and that more research is needed on the health implications. The Vype commercial has raised concerns that it could undermine a decades-long struggle to eradicate smoking, by renormalizing the habit in the eyes of the public.

As of 13:50 UTC buy BAT shares at 3,116.00p

As of 13:50 UTC sell BAT shares at 3,115.00p

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