From Philip Morris to Altria|Business Strategy|Case Study|Case Studies

From Philip Morris to Altria

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Case Details:

Case Code : BSTA077
Case Length : 18 Pages
Period : 2003
Organization : Philip Morris
Pub Date : 2004
Teaching Note :Not Available
Countries : USA
Industry : Tobacco

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Background Note

Headquartered in New York, Altria Group, Inc., formerly Philip Morris Companies Inc., was a holding company and the parent company of wholly owned subsidiaries Philip Morris USA Inc. (PM USA), Philip Morris International Inc. (PMI) and its majority-owned (84.2%) subsidiary, Kraft Foods Inc. (Kraft)...

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Early History

PM opened its London tobacco store in 1847 and by 1854 started making its own cigarettes. A new firm owned by American shareholders acquired the US Philip Morris Company and incorporated it in Virginia under the name Philip Morris & Co. Ltd...

PM and Tobacco

PM USA manufactured, marketed and sold cigarettes in the United States and its territories and exported tobacco products from the United States. PM USA's major brands were Marlboro, Virginia Slims and Parliament...

Anti-Smoking Campaigns

The tussle between anti smoking campaigners and cigarette companies intensified in the 1990s. In 1993, the Environmental Protection Agency (EPA) of USA classified "second-hand" smoke as a health hazard that caused 3,000 non-smokers to die from lung cancer each year...

Law Suits

In the early 2000s, litigation was the biggest concern for tobacco industry. Beyond anti-smoking campaigns and state legislations, the growing number of individual cases had become a cause for worry...

PM's Response

Bible clearly resented Philip Morris' pariah status. "The company is filled with decent, hard-working people, no different from any other. We go to church. Our children go to school," he said. "We need to do more to restore self-pride amongst our employees...and to have our place at the table like any corporation."...


As U.S. markets shrank, overseas markets became the critical avenue for growth. PM had only a 14% share outside the U.S., where higher percentages of people smoked, where nonsmokers were far more tolerant of the habit, where opposition was less organized, and where consumers were less litigious...

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