Policy Options to Restrict Tobacco Marketing in Stores

Ellen Feighery RN MS

Public Health Institute

Oakland, CA

Why Focus on Stores?

• Stores are the main communication channel used by tobacco companies to reach new and current customers.

Changes in tobacco company marketing dollars in stores between 1997 and 2001 (in billions)

0.3

4.8

4.5

0.3

1.0

2.4

11.2

1.7

5.7

1.9

0.0 2.0 4.0 6.0 8.0 10.0 12.0

Total

other

POS ads

retail value added

promotionalallowances

1997

2001

How do tobacco company marketing expenditures impact the store?

Tobacco marketing expenditures dramatically alter the store environment:

• Displays and shelving units

• Prominent placement of ads and products

• Special sales

• Lower prices

What can we do to reduce tobacco marketing in stores?

• Raise community awareness

• Adopt or strengthen policies:Self-service display bansExterior sign lawsConditional use permitsMinimum price laws

• Increase compliance with and enforcement of existing ordinances

Self-service Tobacco Display Bans

• Require clerk assisted tobacco sales, and

• Tobacco products must be in locked cases or otherwise inaccessible to the public.

Self-service Tobacco Display Bans

Self-service Tobacco Display Bans

• May reduce youth access to tobacco by:

- reducing tobacco theft, and

- increasing likelihood of interaction between a clerk and a minor.

What is a Sign Law?

• Most local governments regulate the placement and posting of signs.

• Usually part of a city or county’s zoning laws.

• Sign laws are designed to promote effective communication while “protecting the public and preserving the aesthetic character of the city.”

Exterior Sign Laws

Provisions of a Good Sign Law

• Limits the amount of storefront signage, and

• Prohibits certain types of signs.

• If enforced, a good sign law may limit the amount of tobacco advertising outside of stores.

Land Use Regulations

• Land use regulation is a fundamental police power of local governments.

• Zoning can be used to limit the location, density, and proximity of tobacco retailers.

Land Use Tools

• Two main land use concepts are available to control tobacco retailers:

– Regulate where businesses (“uses”) may locate, and

– Regulate how a business operates.

Strengths of Zoning

• Regulate location: keep tobacco retailers away from children– Restrict to certain zones– Require set-backs of x feet from:

• Youth oriented areas and facilities• Residential zones

• Limit the number of tobacco retailers:– Limit density– Limit proximity to other stores

What is a Conditional Use Permit?

Can determine individual suitability for a particular location.

- Use must be legal under zoning laws

- Approval can be based on site-specific factors

Can be conditioned on certain rules.- No self-service displays

- Clerks must be at least 18 years old

- Retailer complies with all tobacco laws

Can be suspended if conditions are violated.

Minimum Cigarette Price Laws

Minimum Cigarette Price Laws

• Originated between the 1940s and - 60s

• Designed to eliminate predatory and/or discriminatory business practices and discriminatory promotions

Minimum Cigarette Price Calculation

Manufacturer’s gross invoice price

+Excise tax

=

+

-

=

+

Basic cost of cigarettes

x% wholesaler’s mark-up

Minimum wholesale price

Trade discounts

=

x% retailer mark-up

Minimum retail price

Trade Discounts

• Definition is key to strength of a minimum price law.

• Does the law allow a deduction for buydowns and master-type programs to calculate minimum price?

Summary

• Current options are limited but may affect various aspects of tobacco marketing in stores.

• Need to identify other points of intervention .

• Need to advocate for policy reform at national level.

For More Information

• Contact:

Technical Assistance Legal Center

http://www.phi.org/talc