The Marlboro Man’s High-Tech Pivot

Explore how Philip Morris International is attempting an audacious pivot from the world's biggest cigarette maker to a 'smoke-free' tech company.[INTRO]ALEX: Imagine you run a company that owns the single most successful brand of all time—a product so iconic it defined 20th-century masculinity—but your official corporate mission is to make that product obsolete.JORDAN: Let me guess. We’re talking about the tobacco industry, but with a Silicon Valley makeover?ALEX: Exactly. Philip Morris International claims they are building a "smoke-free future," but they’re funding that future by selling hundreds of billions of Marlboros every single year.JORDAN: So they’re selling the poison and the antidote at the same time? That is a wild tightrope walk.[CHAPTER 1 - Origin]ALEX: It all started in 1847 with a single man named Philip Morris opening a small tobacco shop on Bond Street in London.JORDAN: Just a neighborhood tobacconist? That feels almost quaint given what they became.ALEX: It stayed relatively small for a while, but by 1902 they incorporated in New York, and in 1924 they launched a cigarette called Marlboro.JORDAN: Wait, 1924? Was the Marlboro Man riding horses through the streets of Manhattan back then?ALEX: Not even close. Marlboro was originally marketed to women with the slogan "Mild as May."JORDAN: You’re kidding.ALEX: They even had red filter tips specifically designed to hide lipstick marks.JORDAN: So how did we get from "Mild as May" to the rugged cowboy in the desert?ALEX: That was the pivot of 1955. They added the legendary filter and launched the "Marlboro Country" campaign, which turned the brand into a masculine powerhouse.JORDAN: And I’m assuming it worked, because I’ve never seen a "Mild as May" billboard.ALEX: It worked too well. It became the best-selling cigarette in the world by the 1970s, turning Philip Morris into a global juggernaut that started buying everything from General Foods to Kraft.[CHAPTER 2 - Core Story]JORDAN: Okay, so they’re a massive conglomerate sitting on a mountain of cash. Why did they split the company in two in 2008?ALEX: That’s the "Great Spin-Off." The parent company, Altria, kept the U.S. business, while Philip Morris International—or PMI—became a separate entity to handle everything outside the States.JORDAN: Was that just a legal shield to get away from U.S. lawsuits?ALEX: That was a huge part of it. It allowed PMI to grow aggressively in emerging markets while the U.S. side dealt with heavy regulation and litigation.JORDAN: So they were free to just sell as many cigarettes as possible abroad. When did the "we want to stop smoking" narrative start?ALEX: Around 2014, when the then-CEO André Calantzopoulos announced the pivot to a "smoke-free future."JORDAN: That sounds like a PR stunt. Did they actually stop selling cigarettes?ALEX: No, but they spent billions building a research facility in Switzerland called "The Cube."JORDAN: "The Cube"? That sounds like something out of a Bond movie.ALEX: It’s where 400 scientists develop things like IQOS, which heats tobacco instead of burning it.JORDAN: Why does "heating" matter if it’s still tobacco?ALEX: Because PMI argues that the combustion—the literal fire—is what releases most of the cancer-causing chemicals, not the nicotine itself.JORDAN: Okay, I see the logic, but isn’t it still incredibly addictive?ALEX: Absolutely, and that’s the catch. They want to keep the customers addicted but reduce the number of them that die from the product.JORDAN: It’s a survival strategy. If your customers die, your revenue dies.ALEX: Right, but it got weirder in 2021 when PMI bought a company called Vectura.JORDAN: Never heard of them. What do they do?ALEX: They’re a pharmaceutical company that makes inhalers for respiratory diseases.JORDAN: Hold on. The company that makes the cigarettes that cause lung disease is now selling the inhalers that treat it?ALEX: That’s exactly why medical groups were outraged. They called it a cynical attempt to profit from a crisis they helped create.[CHAPTER 3 - Why It Matters]JORDAN: So where are they now? Are they actually moving the needle, or is this all just a way to sneak past tobacco bans?ALEX: The numbers are actually staggering. By 2023, nearly 36% of their revenue came from "smoke-free" products.JORDAN: That’s more than a third of their business. That's not just a side project.ALEX: No, it’s a total reinvention. They also bought Swedish Match for 16 billion dollars, which gave them ZYN—those nicotine pouches you see everywhere now.JORDAN: ZYN is everywhere on social media. Is that their new "Marlboro Man"?ALEX: In a way, yes. It’s ultra-discreet, tech-friendly, and huge in the U.S. market.JORDAN: But doesn't this just create a whole new generation of people hooked on nicotine?ALEX: That is the core of the debate. Critics say PMI is just finding new ways to keep people dependent, while the company says they are providing a path away from the most dangerous form of tobacco.JORDAN: It feels like they’re trying to move from being a "sin stock" to a health-and-wellness company.ALEX: That’s their stated goal. They want to be a tech-driven company that solves the problems it created.JORDAN: It’s like an oil company saying they’re going to be the leaders in electric cars while still drilling in the Arctic.ALEX: It’s exactly that. They claim that as long as people want to smoke, someone will sell it to them, so it might as well be them using the profits to build the exit door.[OUTRO]JORDAN: So, after all the science and the billion-dollar acquisitions, what’s the one thing we should remember about modern-day Philip Morris?ALEX: They are a massive legacy power attempting the world’s most expensive corporate makeover: trying to convince the world they can be the cure for the products they still sell by the billions.JORDAN: That’s Wikipodia — every story, on demand. Search your next topic at wikipodia.ai.