Jul 06, 2007 (Richmond Times-Dispatch - McClatchy-Tribune Information Services via COMTEX) -- Philip Morris USA might roll out its newest smokeless tobacco product nationally three to six months after the start of a test market, one analyst predicted.
The Henrico County-based company plans to test market Marlboro snus in Dallas starting next month. Long popular in Sweden, snus is a smokeless, spitless tobacco sold in pouches that users place between their upper cheek and gums.
The product, which Philip Morris is making at a plant in York County, is a new direction for the nation's largest cigarette company.
"We do not believe it will be long after the August . . . test marketing of Marlboro snus begins that the product is rolled out nationally," Bonnie Herzog, a tobacco industry analyst for Citigroup, wrote in a research report this week. "Given that PM USA has already test marketed a similar product, Taboka, for quite some time, we anticipate a rapid rollout of Marlboro snus."
Taboka is a smokeless, pouch tobacco that Philip Morris started test-marketing in Indianapolis last year.
Philip Morris USA spokesman David Sutton said he could not comment on Herzog's report or the company's plans for Marlboro snus beyond the test market.
Herzog also wrote that Marlboro snus is being well received by retailers and wholesalers, who believe it will do well with smokers and users of traditional snuff.
One analyst, Christopher Growe of A.G. Edwards & Sons Inc., said last month that Taboka had sold poorly in test market, based on his contacts with retailers. Growe said Philip Morris might seek an acquisition to gain a foothold in the smokeless market, which is attractive to cigarette companies because it has been growing while U.S. cigarette consumption has been slowly declining.
Other companies have introduced snus products recently, including Richmond-based Swedish Match North America, which is selling its brand, General, at some stores in the Richmond area. Philip Morris USA's largest competitor, Reynolds American Inc., introduced Camel Snus in test markets last year.
Philip Morris USA has described the Taboka test market as a learning experience. "We have gotten a lot of feedback that those [consumers] who tried it, liked it," Sutton said.
Contact John Reid Blackwell at (804) 775-8123 or jblackwell@timesdispatch.com.
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