PMI's Marian Salzman: 'I wasn't bought'

Philip Morris International's SVP of communications explains why she traded in a long career working on social issues to lead PR at one of the world's largest tobacco companies.

Marian Salzman attends the 2019 Cannes Lions International Festival of Creativity last month. (Photo credit: Philip Morris International)
Marian Salzman attends the 2019 Cannes Lions International Festival of Creativity last month. (Photo credit: Philip Morris International)

When Marian Salzman exited Havas last April and relocated to Switzerland to head up communications at tobacco behemoth Philip Morris International — a story first reported by PRWeek  the move was met with general disbelief by the PR sector.

Salzman had become well known for socially responsible work for institutions such as the United Nations Foundation and the U.N.’s Sustainable Development Goals, aiding families affected by the Newtown shooting, supporting the Bob Woodruff Foundation in its work with wounded veterans and helping Haiti recover from natural disasters.

The thought of her aligning herself with Big Tobacco seemed anathema to many observers. Her bringing along other social justice warriors, such as Aaron Sherinian as VP, global communications transformation, for the PMI ride sent further shockwaves through the industry.

Jody Sunna, who previously worked with Salzman at Havas PR U.S. as EVP, consumer/lifestyle, also came on board as director, corporate communications.

The overall communications team comprises about 100 people, of which 60 are fulltime communicators, others support internal communications and elements such as sponsorships - 50 are based in Lausanne, 20 in London, eight in New York City, six or seven in Washington, DC.

When headhunters initially approached Salzman about coming to work at PMI, she admits her first response was, "You’ve got to be kidding. I don’t do tobacco, I’m not a smoker and I don’t want to live in Switzerland [PMI’s head office is in Lausanne]."

But the exhortations were persistent, and the more research she did and the more conversations she had with senior management at the much-maligned tobacco giant, the more intrigued Salzman was by the opportunity. After a six-month courtship, Salzman made the jump.

Most third-party observers assumed money was the primary lure for Salzman, but she denies that was her motivation.

"When I took this job, I was being pursued by a few other alternatives," she says. "Philip Morris had to match the offer. We all work for money. PMI is a very generous employer. But I wasn’t bought."

She admits the compensation package is "at the high end of sector [salaries]" but denies rumors it is in the $1.5-million range.

"I wish that was true, but it’s completely not," she says. "When you roll in all the benefits, stock and so on and [look at] your list of the top 50 paid communicators, I’m going to be on that list. But I’m not at the very top and I’m not at $1.5 million cash. There are other categories that pay well or better than we do."

Salzman says she knew little about PMI or how it was trying to re-brand itself when she was being pursued by the company.

"I, like most people, really thought of PMI as what it had become in the U.S. — this Marlboro-selling cigarette company," remembers Salzman. "I had no clue about smoke free."

For clarity, Philip Morris International is a completely separate entity from Philip Morris USA, from which it divorced over a decade ago. Philip Morris USA is the tobacco division of Altria Group and has been the leading cigarette manufacturer in the U.S. for the past 40 years.

Trading on the NYSE, Altria also has a 35% stake in e-cigarette company Juul, which itself has a 34% share of the nascent but already controversial U.S. vaping market. It also owns 10% of Anheuser-Busch InBev.

For its part, PMI is now positioning itself as a smoke-free company dedicated to eradicating combustible cigarettes and replacing them with less-harmful alternatives, such as its IQOS heated tobacco system, which in April received FDA approval to be sold in the U.S.

IQOS is a system based around an electronic device that heats tobacco-filled sticks wrapped in paper to generate a nicotine-containing aerosol, producing fewer or lower levels of some toxins than combustible cigarettes.

The FDA is quick to emphasize that while the products can be sold in the U.S., they are not safe or FDA approved, and they still deliver nicotine levels close to those of combustible cigarettes. But the FDA believes few non-tobacco users would be likely to choose to start using IQOS, including young people.

"About 70% of people who start the journey from combustible cigarettes to IQOS stay with IQOS," says Salzman.

The IQOS device is sold in 47 countries, including Germany, Italy, the U.K., Russia, Korea, Romania and Japan, where one in five smokers have converted to the heated tobacco system in the space of four years. In the U.S., products authorized for sale include the IQOS, Marlboro Heatsticks, Marlboro Smooth Menthol Heatsticks and Marlboro Fresh Menthol Heatsticks.

"We can’t say this in the U.S. yet, but around the world we make the claim that it’s 90% to 95% better for you but not good for you," says Salzman. "It’s a better-for-you solution for people who do smoke; it’s not something for people who don’t smoke."

However, pressure groups such as the Campaign for Tobacco-Free Kids point out that PMI still manufactures more than 800 billion cigarettes a year around the world and in 2018 it comprised 27.4% of the international combustible market. According to independent consultancy Brand Finance, Marlboro is the world’s most valuable tobacco brand, with a value of $33.6 billion.

In March, PMI launched a new brand of high-nicotine, high-tar cigarettes in Indonesia called Philip Morris Bold, backed with an advertising campaign produced by Leo Burnett called You Decide. The same campaign also ran in Israel.

To further complicate matters, while Altria is completely separate from PMI, the company will be the distributor of IQOS in the U.S. and will market and license the product and sell it in this market.

Confused? Yes. Skeptical? Certainly.

"As a comms and marketing professional, I ask our management what we’re doing about this every day of the week," says Salzman. "It fuels considerable confusion in the marketplace. A lot of the accusations made about us are actually about Altria."

The skepticism certainly stretched to the recent Cannes Lions International Festival of Creativity, where attendees saw PMI touted as a sponsor of the Good Track, alongside brands more traditionally associated with social causes, such as Greenpeace, UNWomen, World Food Programme and Sesame Street.

The program included an open mic area on the beach at Cannes, moderated by former Pepsi and Mondelez executive Bonin Bough and featuring guests including actress Rose McGowan, influencer Cindy Gallop and former J. Walter Thompson CCO Erin Johnson.

Bough also conducted a discussion on one of the Palais stages with musician Wyclef Jean and PMI’s VP of strategic and scientific communications Moira Gilchrist.

Rounding out the cigarette manufacturer’s presence during the week, advertising trade publication Ad Age hosted a Future of Creativity Conversation with PMI and at the Open Mic Beach Lounge on the Thursday evening of the festival.

As Salzman tells it, regardless of whether PMI is in the tobacco business, the World Health Organization says there will be over 1 billion smokers in 2025, despite many years of anti-smoking messages being pumped into the system.

She says PMI has the potential to be an incredible change agent precisely because of its scale and the fact it has a great deal of money and a commitment to smokers that makes it uniquely bothered to try and get people to change their behavior.

"Unlike global warming, which I’d worked on with the United Nations, where (at the time) pretty much everyone agreed it was real and profound," she notes. "I began to know PMI and understand their passion. I became more and more intrigued by the difficulty of the job. I had never tried to create a narrative around something that was so complicated and so tense."

At the nub of its argument is PMI’s assertion that its heated tobacco system is a more effective solution to producing a smoke-free future than e-cigarettes and vaping.

"Most of the dangerous aspects of smoking come from the burning of tobacco, the combustion," says Salzman. "By heating the tobacco but never to the level of the burn, you are effectively taking away most of what’s bad about smoking — but not all of it.

"So for people who still want the tobacco flavor, the nicotine, what they perceive as the benefits in terms of the respite but without the burning, IQOS is the best answer."

Indeed, e-cigarettes have already been banned in California because authorities became concerned about a sharp rise in nicotine use among teenagers. Federal data suggests 21% of high school students vaped in 2018, and the FDA is increasingly concerned about an "epidemic" in teen vaping.

Juul is the leading manufacturer of e-cigarettes, and the company’s CEO, Kevin Burns, this past weekend actually apologized to parents for the rise in youth consumption of his company’s products.

"It’s not intended for them," he added. Juul has shut down social media accounts and discontinued fruit flavors to try to stem the uptick in usage of e-cigarettes by young people.

"Most of the noise in the market, rightfully so, is about youth," says Salzman. "Our product [IQOS] neither appeals to nor has been impactful with youth. We have no claims anywhere in the world about youth smoking. We’re not being accused of bringing youth into the franchise with IQOS."

Young men smoke e-cigarettes while at an industry exhibition in St. Petersburg, Russia. (Photo credit: Getty Images)

She claims IQOS is a system and not an instant gratification mechanism that can be unlocked on a whim.

"It’s a two-week conversion. You’re not satisfied with the experience until 7 to 14 days," she argues. "The accusations — and they have some merit — are that vaping is more susceptible to impulsive usage by young people, especially with the fruit flavors."

In the U.S., Atlanta will be the first test market for IQOS. That rollout will occur in late summer/early fall.

"That’s all that will be on sale in the U.S. in calendar year 2019, while they figure out how to best take the consumer on this journey," says Salzman.

In terms of agency support, Salzman says "we have all of our PR firms in place."

PMI is working with a McCann WorldGroup agency cluster called Team IX and Better Me, a Havas cluster created expressly around PMI. It is also working with BCW in parts of the world.

"Occasionally, we’ll add partners in different territories," says Salzman. "It’s not up to me who we work with in the U.S.; that’s an Altria decision."

PMI worked with MSL on its Japanese IQOS launch, and it works with various Publicis agencies across the world.

"Publicis continues to be our largest vendor around the world," says Salzman. "We did a review last summer and looked at our existing relationships. We met all the holding companies except MDC."

All briefs are integrated communications briefs, including earned, content, amplification and activations. None of Salzman’s PR budget is allocated to the promotion of the combustible cigarette part of PMI’s business.

"I don’t participate in any conversations around combustibles — my work is all on marcomms around heat, not burn," says Salzman. "On the marketing side, they will involve combustibles, but those budgets have really shrunk. As far as I know, Team IX does nothing for PMI on combustibles — nor does Havas or BCW."

Salzman chats with Theresa Howard, founder of The Press Republic, while in Cannes. (Photo credit: Philip Morris International)

However, PMI did pull an influencer program in Russia in May when a Reuters investigation discovered an IQOS social media ambassador being paid to promote the heated tobacco products online was only 21.*

The company told PRWeek UK at the time: "We were deeply disappointed to discover this breach and are grateful it was brought to our attention in order that we could take swift and comprehensive steps to address our mistake."

But Salzman remains comfortable defending her role heading communications for PMI and the credibility of the company’s commitment to eradicating smoking.

"We represent an extraordinary economic force," she points out. "We employ 80,000 people around the world. We pay a considerable amount of tax [$50 billion in 2018].

"If a government wanted us to stop selling cigarettes, they ought to say that. Think about the amount of good things done with that money. You would cause grave economic hardship if you didn’t continue to sell our products until you have something else to sell."

The theory Salzman espouses is that if PMI stopped selling cigarettes tomorrow, they would just be sold by someone else, so it’s better if a company that’s investing in a smoke-free future is doing it.

In countries where PMI has been given permission to sell the heated product, Salzman says the transformation has been "profound."

"I have never from the moment I walked through the door worked on a combustible cigarette," she says. "We are the only ones committed to a smoke-free future. There’s no turning back for us. We bet the farm on a healthier choice."

Once IQOS is legal for sale in a country, PMI immediately stops marketing cigarettes, Salzman says**. The company plans to convert 40 million people away from cigarettes by 2025.

"We don’t stop selling them, but we stop marketing them," she adds. "Nobody’s arguing that PMI is the Virgin Mother or Mother Theresa, but we’re doing the best we can to make a difference. To hold people responsible for what happened in the 60s or 70s is outlandish."

Editor's notes:

* Subsequent to the Russian incident, PMI claimed to have suspended "all product-related digital influencer actions," however IQOS ambassadors are still actively promoting IQOS on social media in Romania.

** While Salzman claims PMI stops marketing cigarettes once it introduces IQOS in territories, contrary to her assertion, PMI launched IQOS in Israel in 2017 and is still advertising cigarettes in that country. It launched IQOS in Romania in 2015 and is still advertising cigarettes in that country at point of sale, alongside IQOS.

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