Led by advocates at the World Health Organization, many nations are considering and some, — notably Australia, the United Kingdom and France — have adopted regulations requiring all tobacco packages to have a uniform plain color and texture, a standard shape, size and materials of packs, and no branding, logos or other promotional elements on, inside or attached to the packaging or on individual products.
The brand name, product name, quantity and contact details may appear – in a standardized typeface together with mandatory health warnings.
The idea is to reduce the appeal of tobacco products, and Australia found that plain packaging does, indeed, reduce the appeal of tobacco products, increase the noticeability and effectiveness of health warnings and appears to change smoker behaviors and attitudes. Australia, in fact, estimated that 118,000 fewer Australians were smoking 34 months after plain packaging was mandated.
And it appears anti-alcohol advocates are now targeting beer, wine and spirits for plain packaging.
We haven’t found any evidence that there’s an immediate threat to bev/al. After all, tobacco and alcohol are different: cigarettes are the only consumer product to have been proven to be deadly when used as intended. Beer, wine and spirits, on the other hand, have been shown to have positive cardiovascular benefits when consumed in moderation.
But Brand Finance, a UK consultancy, estimates that if plain packaging was enacted globally, it would result in a $17.439 billion sales loss for Pernod Ricard. That’s 36.2% of Pernod’s enterprise value. Anheuser-Busch InBev would see a $64.6 billion loss in sales, equal to 26% of enterprise value.
“With health advisors labelling obesity ‘the new smoking’, it is not surprising that there have been repeated calls for plain packaging legislation to expand into the food and drink sectors,” says David Haigh, CEO, Brand Finance. “It is obvious, however, that this type of legislation could severely damage these companies’ business values. The contention between health and policy advisors and global food and drink brands will no doubt pick up pace as the issue continues to gain traction on the global stage.”