Ashes to Ashes (63 page)

What is indisputable, though, is that the brand took off fast, largely on the strength of the novel ads; Cullman forgave Landry; and within a year of Pall Mall Gold 100s’ debut, there were twenty-seven brands of that length on the market, commanding 15 percent of all cigarette sales—and B&H 100s was the top seller among them.

An equally striking marketing victory came out of Philip Morris’s response to American Tobacco’s introduction of a women’s specialty brand. Silva Thins, brought out in 1967, was a plausible notion not only because women comprised a growing proportion of the cigarette market but also because they had participated heavily in both the move to king-length cigarettes, which women liked for being more stylish, and the massive switchover to filter-tip brands, which women, as the more health-conscious sex, were quicker to take up than men. With the onset of the women’s liberation movement in the ’Sixties, why not offer a brand with explicit feminist appeal? But American Tobacco’s execution of Silva Thins was even more misbegotten than its handling of Gold 100s, particularly its advertising, which seemed to go out of its way to offend those at whom the product was aimed. “Cigarettes are like girls,” declared the copy in one early Silva Thins ad, “the best ones are thin and rich.”

Philip Morris entered the women’s field a year later and bested American’s entry in every way, starting with the name, Virginia Slims. “Virginia” was a woman’s name, and also that of a prime tobacco state. And while “Thins” suggested the appetite-suppressing virtues of smoking, “Slims” was a more nuanced and pleasing synonym, implying grace and beauty. Then there was the smart Virginia Slims package, a soft and creamy off-white with a band of vertical stripes in autumn colors, and narrower than any other because the cigarettes inside were more slender—100 mm. long and 23 mm. in circumference compared with 25 mm. for most ultra-long brands; the brand name was printed in lean, discreet letters.

What made Virginia Slims click, though, was the brand’s advertising, in particular the look of the women shown and, more important, their attitude. The models were young, pert, strikingly slim, and tailored with flair, often in pants suits that emphasized their long-stemmed beauty. Their poses were gymnastic, and their sassy looks had an in-your-face boldness that proclaimed a free spirit and robust health. The ad copy was pitched at the newly independent social status of women, exuberantly declaring their progress and needling men for having long exploited them as cooks, laundresses, and floor scrubbers. The most amusing and telling ads were worked around simulated vintage photographs of Victorian-era scenes in which, for example, a girl in a stifling swimming costume was dreaming aloud, “Just you wait. Someday we’ll be able to wear any bathing suit we want. Someday we’ll be able to vote. Someday
we’ll be able to smoke just like a man. Someday we’ll even have our own cigarette.” No longer were women men’s “loving pets,” the Slims ads asserted, and all of them featured the clinching brand slogan “You’ve Come a Long Way, Baby” at the bottom of print ads or delivered in a brassy, driving contemporary beat on broadcast media.

That “Baby” at the end of the slogan ignited a fierce debate between the Burnett ad agency team, which played a vital role in the whole conception of the new brand, and the marketing crew at Philip Morris. The agency people from Chicago feared that the word would be taken as offensive or derisive, close in meaning to “babe,” with its connotation of a cheap or readily available woman
qua
sex object—and anyway, babies may have been cute and cuddly but they weren’t equal to men in community standing. At the Philip Morris office in more cosmopolitan New York, “Baby” was understood to be a term of studly affection, the way Bogart called his film women “baby” and “sweetheart,” and besides, since the whole point of the brand and its pitch was pro-feminist, the slogan would surely be taken as endearing recognition of women’s liberated state. The Burnett people persisted in presenting the jingle
sans
the tag “Baby,” but it fell flat—until one of the agency executives reluctantly put on the “Baby” version, and, as Landry remembered, “It was the shade of difference that lifted the whole thing a hundred feet in the air.”

The slogan keyed the launch. The secret of it all, suggested Ellen Merlo, an early Slims brand manager and the first woman to advance as high as the second managerial tier at PM, was that “it was never strident, almost always tongue-in-cheek, and not feminist so much as liberationist, in the sense that the slogan really meant, ‘You’ve got a lot of options now.’” It was fun, flattering, and effectively promoted through merchandise that underscored the equality angle, like little black books for listing men’s phone numbers (since women, too, were allowed to play the field now), jogging shorts, and a bright yellow box for “serious” tools for women (“Because now you’ve got a lot more to fix than your face”).

When the whole enterprise was laid out for his approval, Cullman pulled Landry aside and said he thought it was crazy to create a brand that intentionally eliminated half of the smoking market. But appreciative of Landry’s savvy in embracing the “Marlboro Country” campaign against much internal opposition and the Benson & Hedges self-mocking approach against Cullman’s own wishes, he okayed a market test in San Francisco, the likeliest place to accept the attitudinizing women’s brand.

Sales executive Tom Littleton, newly transferred to the Bay City about the time of the Slims launch, remembered it as “a very slick piece of business” featuring audiovisual filmstrips, jazzy point-of-sale placards, and cartons instead of packs as samplers. “You knew right away it was a winner, the way it
jumped off the shelves,” said Littleton. “The copy in the Slims ads was so upscale, so fashionable, so much on the cutting edge, and the models were absolutely, totally right—they just had it. It was all just as right in its way as ‘Marlboro Country.’” Virginia Slims took a few years but soon ran away from all rivals as the leader within its niche in an increasingly fragmented marketplace. Though never among the top-selling brands, Slims got up to a nearly 3 percent market share in a business where a single percentage point was enough to earn sizable profits. Within half a dozen years of the Slims launch, the percentage of teenage women who smoked had doubled. And Philip Morris was riding a hot streak: between 1964 and 1969, its unit sales climbed 63 percent—this at a time when industry leader RJR’s volume barely held its ground—and the company had moved into fourth place in the industry, hard on the heels of No. 3 Brown & Williamson.

V

IN
March of 1965, on the brink of Philip Morris’s explosive growth, the brokerage house of E. F. Hutton presciently advised its clientele that the company was “the most attractive investment” in the tobacco business and “exceptionally well managed”. Everybody in the industry knew that the driving force behind PM’s superior management was Joseph Cullman.

He had a boyish enthusiasm that made him seem younger than his age and turned him into a charismatic motivator whom everyone in his burgeoning company wanted to please. Like most successful chief executives, Cullman was more reactive than creative, and he was self-confident enough to know his own limits and be willing to canvass broadly, all the while melding disparate talents and tolerating ornery but gifted subordinates like Jack Landry as he sought to build a consensus.

Near his desk and later moved to his trophy room was a pair of elephant tusks about seven curving feet in length that Cullman had bagged on one of his African hunting trips. Upon minimal inquiry, the sometime hunter would avidly narrate how he had set out in the bush wearing shorts and sneakers and toting a 456 Winchester with a 270 2.5-power scope, and by the time he pursued the retreating pachyderm through the thorny underbrush and delivered the coup de grace at fourteen yards, he was down to his Jockey shorts. The huge ivory souvenirs of the adventure that he kept on nearby display gave rise to the company gag that Joe Cullman, though on the diminutive side, was for all practical intents a three-ton elephant who slept wherever he wanted on the premises
(i.e.
, got his own way with minimal resistance). “But they were wrong,” remarked Shepard Pollack, later president of Philip Morris USA. “Joe
was more like a three-ton dog—a dog walks around and around before he settles down to sleep, checking out the terrain carefully to be sure he won’t be lying on bristles.”

Cullman earned the respect of his colleagues not for any piercing intellect or excessive sweetness of disposition—indeed, he could be intense, impatient, and very tough on staffers who hadn’t done their homework—but because he had absorbed and synthesized a great deal of knowledge about the tobacco business. He had grown up in the industry and had built on long family friendships with dealers across the country. While he could be highly guarded and private, he had an extroverted side that kept him from ever becoming a cloistered, above-the-battle commander. He made the rounds faithfully, showing the company banner at every major industry meeting, convention, and trade show and stopping by frequently at wholesalers’ offices, with his regional sales manager in tow, to shoot the breeze and then ask pointed questions about how his brands were performing. If these visits smacked a bit of a royal audience, inferentially flattering to the big jobbers who were pleased to have an industry mogul drop by, so much the better. Cullman’s visits were vividly recalled by Stephen J. Bloom, whose Chicago-based family tobacco distribution business was one of the nation’s largest before being sold to giant Core-Mark: “Joe was a warm, outgoing individual with a high energy level who never became enchanted with his own success.” Veteran Philip Morris sales executive Max Berkowitz saw the dual aspects of Cullman’s winning ways with customers and subordinates alike: “He had the aura of class—his people were part of society—the German-Jewish equivalent of the Kennedys. Yet he was also a regular guy … who didn’t pretend to be the smartest fella in the world—but he listened.”

Never constrained by lines of authority, Cullman prided himself on running a big company, bulking up by the month now, with the management mentality of a small business. But by 1967, he had to step away from the day-to-day direction, taking the title of chairman of the board and CEO and naming as president George Weissman, who had been running the international operations for seven years; at the same time, he elevated Ross Millhiser, vice president for marketing and overseer of the fortunes of the company’s bellwether product, Marlboro, as president of Philip Morris USA, and Hugh Cullman, Joe’s cousin and junior by eleven years, as president of Philip Morris International. In the process he put in place the likeliest contenders to succeed him, particularly advancing the hopes of Millhiser, a man more like Cullman than the smooth and genial Weissman, the up-from-poverty City College graduate from the Bronx, whom Millhiser (among others at the company) was said to regard as something of an operator, more knowledgeable about the glad-handing arts than the tobacco business. Like Cullman, Millhiser was a Yale man from a well-off family of German-Jewish extraction. Unlike his boss, Millhiser was a complex
man of boundless intellectual curiosity, reading up on subjects often remote from the tobacco trade, quick to question pat assumptions, forever verbalizing new ideas, and carrying it all off with a self-dramatizing quality that made him eminently quotable within the company walls.

Whatever their differences, Millhiser and Weissman typified the sort of executive whom Cullman particularly valued: not organizational politicians or business-school generalists but men with an entrepreneurial spirit, hungry to build the company as well as their own bank accounts, with expertise in a given field but gladly reaching out to learn the whole business—and willing to take calculated risks. Cullman had a true gift for attracting such people, deploying them shrewdly in jobs they themselves might not have thought they were suited for, and assembling a management team with extraordinary continuity. “He built a great cadre of managers,” said Hugh Cullman, “and lost very few people he didn’t want to lose.” Those who stayed developed an abiding loyalty, unsullied by infighting common to large organizations, and Cullman reciprocated in kind with a personal interest in his people, immersion in all major decisions, and acceptance of setbacks without recrimination, even as he celebrated triumphs without gloating.

If he could be moody and mercurial at times, Cullman almost always kept his emotions in check, never drank in public beyond his capacity, and enjoyed a growing celebrity and widening range of interests. If there was a complaint about him, it was that he was becoming too busy with outside affairs and sometimes was just not around when his counsel was sought. But even those outside preoccupations had a way of advancing Philip Morris’s cause. His passion for tennis was a prominent case in point. After arriving at his office by 8:15 each morning from suburban Briarcliff Manor, Cullman often went to the West Side Tennis Club in Forest Hills at 11 for a fast doubles match. This recreation grew into deep involvement with the business affairs of the U.S. Lawn Tennis Association, assisted by Philip Morris accountants. When the tennis organization entered into a five-year deal with CBS television to cover the U.S. Open tournament staged at the club, it was Cullman as tournament chairman who engineered the pact. As a payback, Philip Morris was visible everywhere at Forest Hills, the prime showcase for tennis in America, beginning with a donated $165,000 electric scoreboard beckoning spectators, on the premises and over television, to “Marlboro Country”.

In only one area did Cullman show an iron hand, and it would turn into an often invoked company creed—an insistence on quality control of the product. To oversee the worldwide presentation of his broadening cigarette lines and maintain a consistency of look, taste, and quality, Cullman set up an elite Products Committee, composed of ten to a dozen top people, that met monthly and had to approve every introduction or innovation no matter how slight, whether the lettering on the packs or an alteration of a blend or, at the other extreme, a
whole new brand. It was the same way with sales materials, whether ad layouts or point-of-sale posters. This compulsive oversight was intended not to dictate so much as to assure the maintenance of what Cullman conceived of as a high-class operation, notwithstanding the serious health charges levied against it.