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September 2019 (Vol. 4 Issue 7)

How Big Tobacco changed the soda industry

About the author: 
Bryan Hubbard

How Big Tobacco changed the soda industry image

Big Tobacco understood the importance of putting addictive ingredients in its cigarettes, and it applied the same principles when it launched soda drinks—then changed the rules of engagement by targeting kids

Is 'Big Soda'—the manufacturers of sugary soft drinks—as bad as Big Tobacco in covering up the health risks of its products?


The parallel has been mooted a few times, but in 2017, Praxis Project, a health advocacy group, went a step further and issued a lawsuit in which it directly accused Coca-Cola of adopting Big Tobacco's tactics of using 'science' to disprove evidence its drinks were harmful. Just five months later, Praxis withdrew the suit, amid claims it had overplayed its hand.


In the suit, Praxis claimed that Coca-Cola—aided by the American Beverage Association—had started to ramp-up a campaign of "misrepresentation and deception" in 2012 against a growing body of evidence directly linking sugary drinks to obesity, type 2 diabetes and heart disease.


"Just as the tobacco industry formed the Tobacco Industry Research Committee in 1953 to respond to scientific evidence linking smoking to lung cancer, Coca-Cola's strategy was one of 'cultivating relationships' with scientists as a way to 'balance the debate' on sugar-sweetened beverages," Praxis stated in the lawsuit.


Coca-Cola hit back, describing the suit as "legally and factually meritless" in an email to Vice Media's food website Munchies—and just months after issuing it, Praxis withdrew the lawsuit. But a secret cache of papers, uncovered by researchers at the University of California at San Francisco, reveals that Praxis was closer to the truth than it was able to prove at the time.


Not only is 'Big Soda' like Big Tobacco in its tactics, but for many years major sugary drinks brands were owned by tobacco companies, which generated billions of dollars in revenue by using the same flavors and colors applied in selling cigarettes and adopting child-focused marketing tactics that are still used today.

Children first
Sugar and nicotine are two of the most important compounds in cigarettes. They both help make the cigarette addictive, as Victor DeNoble, a whistleblower at Philip Morris, revealed. Although he was silenced for 10 years after he was fired as a research scientist, he finally was able to explain in 1994 just how manufacturers made their products as addictive as an illicit drug.


The sugars produce acetaldehyde, a toxic compound that is carcinogenic (cancer-causing)—and it is the sugar, not the nicotine, that causes lung cancer. Mixed with nicotine, it produces a dopamine response in the brain, making the cigarettes addictive, and DeNoble and his team were tasked with creating the optimal balance between the two.


Given the synergy with this essential ingredient of cigarettes, it isn't surprising that America's two biggest tobacco firms, R J Reynolds and Philip Morris, took an interest in sugary soft drinks. Both used their knowledge of creating addictive products to develop brands such as Hawaiian Punch, Kool-Aid, Capri Sun and Tang, the papers reveal.1


As an R J Reynolds executive explained in a memo to the company's research team, "many flavorants for tobacco would be useful in food, beverages and other products" that could produce "large financial returns."


Thus motivated, in 1962, a vice president at R J Reynolds sanctioned the company's laboratories to develop powdered and 'fizz' tablet forms of sugary drinks and test them specifically on children. This was a first for the industry; at the time, the sector's two major players, Coca Cola and Pepsi, hadn't differentiated between adults and children in the marketing of their drinks.


Reynolds launched its sugary stick drink as King Stir Stick in 1963, and in the same year, consolidated its position in the soft drink sector by acquiring Pacific Hawaiian products, which made Hawaiian Punch.


Over the next 20 years, Reynolds targeted children, doubling its marketing budget to focus on the very young, and launched fun cartoon characters to help sell its sugary drinks. It even reduced the size of its Hawaiian Punch cartons so they would be easier for small hands to grasp.

Morris men
Philip Morris saw the enormous success its rival was having in the soft drink sector and decided to get in on the act with the purchase of the Kool-Aid brand in 1985. And, like its rival, it quickly decided to focus its full attention on kids.


"Marketing has been pretty well balanced between appeals to mom and to the kids. We've decided to focus our marketing on kids, where we know our strength is the greatest. This year, Kool-Aid will be the most heavily promoted kids' trademark in America," company executives reported.


The following year, Morris launched the $45 million Wacky Wild Kool-Aid Style campaign aimed at six- to 12-year-olds and introduced a loyalty program modeled on Marlboro cigarettes' Country Store initiative.


Senior executives held regular 'synergy meetings' where demographic data on adults and children, including ages and purchasing patterns, were shared between the company's divisions.


Other promotions for Kool-Aid included a multi-million-dollar promotional campaign with Nickelodeon—including 3D glasses and scratch and sniff cards—that specifically targeted children as young as two. One enthused marketing executive gushed that Smell-O-Vision, the scratch and sniff card, "raised the bar" for children's marketing after it reached 95 percent of the market of six- to 12-year-olds.

Smokin' guns
The tobacco industry changed the face of the soft drink market. Although Philip Morris and R J Reynolds eventually sold their brands to other companies, they were the first to specifically target small children—and it was a matter of concern as early as 1974, when the Children's Advertising Review Unit was established to promote 'responsible' advertising to children.


But the unit was a watchdog without teeth, and the soda industry agreed to create its own Children's Food and Beverage Advertising Initiative (CFBAI) in 2006 to include advertisements for healthier choices. But as happened with the unit, the CFBAI's guidelines were summarily ignored by its creators.


And bigger concerns were beginning to surface—sugary drinks are a cause of the obesity epidemic in children, and of diabetes and heart disease in everyone, and health researchers were starting to detect the connection.


Just as the tobacco industry had paid scientists to 'prove' their products weren't harmful, so the soda industry followed suit by creating an "independent and scientific" group, the Global Energy Balance Network, which used fake science to demonstrate that childhood obesity was the result of low activity and a high-calorie diet—and nothing to do with sugary drinks.


The group, which included several leading scientists, lobby groups such as Simon Singh's Sense About Science, and a few influential commentators, received more than $1.5 million in donations from Coca-Cola.


The ploy was short-lived, and its main instigator, Coca-Cola's chief science and health officer Rhona Applebaum, took "immediate retirement" in 2015. By then, independent science had established a definite link, and was calling on health regulators to act.


One study, which took another look at 30 research papers, concluded 26 of them had demonstrated that sugar-sweetened drinks caused obesity—and they could be trusted because none had taken their funding from the soda industry.2

Tobacco legacy
Children's health has been one of the highest prices we've all had to pay to fill the coffers of Big Soda—and for that we must lay the blame at the door of Big Tobacco, which started the trend of targeting children.


According to the World Health Organization, 41 million children under five are classified as obese around the world, in many cases as a direct result of drinking sugary sodas. The drinks are also causing around 184,000 deaths a year, mainly from type 2 diabetes, but also heart disease and cancer.


Despite these health concerns, Big Soda continues to thrive. Annual worldwide revenues stand at close to $48 billion and are still slowly rising, at around 1.8 percent a year.
But that's addiction for you. Like sugar. Like nicotine.

Sweet ploys from the tobacco boys
While Big Tobacco controlled a range of popular sugary drinks, it used many of the tactics that made its cigarettes bestsellers.


• Punchy, a cartoon mascot for Hawaiian Punch, was introduced in 1962 when R J Reynolds took over the brand. Punchy was the focus of TV commercials, magazines and comics—and even featured on school book covers, toys, mugs and wrist watches.


• Kool-Aid's mascot became a giant anthropomorphic glass pitcher when Philip Morris took charge of the brand. The idea was to make adults look silly and put the kids in control, according to the advertising agency that designed the campaign.


• Barbie and Hot Wheels were branded with the Kool-Aid insignia as part of Morris's Wacky Warehouse, described by the company as "the most effective kid's marketing vehicle known."


• Magic Twists and Mad Scientwists were sugary treats that changed color when put in water. As Philip Morris executives noted, "kids love colors and twisted up flavor blends."


• A six-issue Marvel comic series was developed, and Philip Morris produced its own magazine, What's Hot, which featured Kool-Aid images and giveaways. The magazine reached a circulation of 2 million copies by 1988.


• Capri Sun, acquired by Philip Morris in 1991, was branded as "an all-natural drink for kids"—although it was far from that. It was positioned as a 'lunchbox' drink that children could take to school with their Lunchables 'fun pack.' Lunchables sales hit $500 million by 1998.


• Tang, acquired by Philip Morris in 1992, was repositioned so it was not seen "only as a breakfast drink." Images of surfers and skateboarders were used to give the drink a broader appeal.


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