ITC: The remaking of a giant | Intermission E04 | The Ken

Intermission

This episode chronicles the extraordinary transformation of ITC from a colonial tobacco company into a diversified Indian conglomerate. The

Key takeaways

• ITC successfully transitioned from a cigarette-centric business to a leader in the Indian flour (atta) market with Aashirvaad.
• The company survived significant corporate crises, including the arrest of two former chairmen and a long war for control with BAT.

Main topics

• History of Tobacco
• ITC Corporate Transformation

Notable quotes

Tobacco is raised to be burnt. It's bred to stimulate our lungs, not feed our stomachs.

Conclusion

ITC stands as a unique case study in corporate resilience and the abil

Transcript preview

Speaker 2 (0:00) A quick note before we start. Tobacco use causes cancer. We do not endorse it and nothing in this episode is meant to encourage it. But this is the story of ITC, a company built on tobacco. So we'll discuss cigarettes and tobacco in the course of its business. Everything should be seen in the context of that story and nothing more. Speaker 1 (0:30) It's May 2002, and ITC launches Atta with the brand name Ashirbad. Mention ITC to any Indian at this point, chances are they will only mention cigarettes. So here's a huge tobacco company making a big bet on winning customers' trust in foods. It's a wild, paradoxical idea, a cigarette maker selling packaged foods. But it's an idea that ITC desperately needs to work. Cigarettes are very profitable, and ITC sells three in every four cigarettes in India. But people are becoming more and more aware of the harm caused by smoking, and the government is raising taxes on cigarettes. The launch of Ashirwat comes just six years after Y.C. Deveshwar became chairman and CEO of ITC, following the arrest of two of his predecessors over foreign exchange violations and a bruising battle with its largest shareholder, British American Tobacco. The company's coming out of what is undoubtedly one of the worst periods in its history. And atta is a particularly tricky category. Indians are used to buying atta from a flour mill or just plain unbranded atta from kiranas. Even the mightiest of FMCG companies, Hindustan Unilever, has not had much luck in this business. ITC knows that success is not going to come easy, but sticks with atta and it pays off spectacularly. Within a few years, Ashirvad is not just the market leader, but it's also synonymous with atta. ITC marks its arrival as an FMCG company to be reckoned with and Deveshwar as a legendary CEO in the making. The company also takes on fearsome rivals like Britannia and Palais in biscuits and Nestle in instant noodles. If ITC is about one thing, it's reinvention. How else can a company founded in 1910 as Imperial Tobacco Company still be one of India's most valuable companies? especially when the percentage of smokers in India's population is clearly falling. How else can India's number one cigarette maker also be its largest paper company, its second largest FMCG and hospitality company, and also one of the largest agri-commodity traders? ITC has done all this while being a firm that's endured for decades without being owned by a family, which is the norm in India. ITC has relentlessly reshaped itself while dealing with the tag of sin stock, which to me is an absurd and unfair label for any business that's perfectly legal. No tobacco major around the world has come anywhere close to ITC in moving so far away from cigarettes and being so successful at it. Not Altria, not Philip Morris International, both of which sell Malboro in different markets, not Japan Tobacco, not Imperial Brands, and not even British American Tobacco. And that's what makes the story of ITC worth telling in full. Welcome to Intermission. I'm Sitaraman Ganesan, the Ken's Deputy Editor, and I'm your host. And I'm Rohan Dharmakumar, Co-Founder and CEO of The Ken, and your co-host. Intermission is a show about India's greatest companies and how they came to be. Through hundreds of hours of research, reporting and conversations, we take a close look at the leaders, rivalries and events that shape these companies and what the future holds for them. Speaker 2 (3:42) There are insights, there are anecdotes, there are opinions and there are numbers. But above all, there is a compelling story in every episode. Speaker 1 (4:04) So Rohan, it's impossible to tell the story of ITC without also telling the story of tobacco. The genus or family of tobacco is called Nicotiana. It's got about 64 species, but humans only use two. These are called Nicotiana rustica and Nicotiana tobacco. And Nicotiana tobacco is the one that is more commonly used. It's a tall plant with broad leaves. Tobacco is native to the Americas. I think mankind first encountered it about 18,000 years ago and started cultivating it about 5,000 to 7,000 years ago in the Andes mountain range in what's present-day Ecuador and Peru. And tobacco was first used as snuff naturally or chewed or eaten or even drunk as tea. And smoking really evolved from snuffing. Did you know Speaker 2 (4:57) 18th century Europeans used to... Well, smoke tobacco via an enema. Not for pleasure reasons, but to resuscitate someone. So tobacco smoke was given to resuscitate someone via an enema. And that's the phrase blowing smoke up someone's ass. Speaker 1 (5:24) Well, I guess this evolved from how tobacco was used in different cultures in the Americas, right? It was very ritualistic. It was considered to have medicinal properties. So I'm not all that surprised. There's a very interesting quote in this book, Tobacco, A Cultural History of How an Exotic Plant Seduced Civilization, by this guy named Ian Gately. And he says mankind's association with tobacco is unlike most human-vegetable relationships. And here's his quote. Tobacco is raised to be burnt. It's bred to stimulate our lungs, not feed our stomachs. And there's another very interesting quote in the book. that lungs had a dual function, they could be used for stimulation in addition to respiration, is one of the American continent's most significant contributions to civilization. In terms of how quickly intoxicants reach our bloodstream, smoking is second only to using a hypodermic needle. Right? Now you can understand why it's so addictive and why you get hooked so quickly. I know you're not a smoker, but were you ever one? I was never a smoker, Speaker 2 (6:35) but I've tried cigarettes, right of passage through college, hostels, and then like, you know, working by yourself, like, you know, independent early careers, etc. And usually that's how, I mean, there's someone smoking, do you want to try it? And that's how you tried it. So yeah, I've tried on and off, but I've never been a smoker. You remember your first cigarette? No, I mean, this is not like some kind of romantic moment that you remember your first cigarette. I don't know, are there people who do that? I Speaker 1 (7:09) do. That Speaker 2 (7:09) remember their first cigarette? Speaker 1 (7:10) Of course I do. Wow, okay. I do not remember my first cigarette. No, I do not. I remember it also because of how it happened. My uncle used to be a smoker and he used to live above our house and he used to toss the cigarette butts down. Okay, Speaker 2 (7:25) he used to smoke Will's Navy Cut Speaker 1 (7:27) and I picked it up, went to the bathroom and smoked. And then used, I didn't have an air freshener then, so I just used. The cockroach spray in the bathroom. Speaker 2 (7:40) Well, you know, that is a story for the ages. I do not have a story like that. Mine must have been boring, which is why I've forgotten it. Speaker 1 (7:47) Yeah, and when we went to college, obviously, you know, there was a hierarchy of smokers. The cool ones, the men among boys, smoked Navy Cut because it was really hard. The run-of-the-mill smokers smoked something like Goldflake Kings. And then the newbies smoked something like menthol, which was like really light, right? So it was a signal to everyone else what you smoked, if at all you were a smoker. Back to the origin story of tobacco. Smoking tobacco was an integral part of the great civilizations of the Americas, Maya, Aztec, and Inca. In fact, the Mayans are considered to be the first historians or chroniclers of smoking. The book has these beautiful depictions of smokers. By the time Christopher Columbus, the explorer, mistakenly lands in the Bahamas in the 1490s after he sets out on a journey to find Asia, tobacco is everywhere in America. I Speaker 2 (8:47) have. Do you know where the word tobacco came from? Speaker 1 (8:51) I read this bit in the book about how it's a bastardization of a word used in the Caribbean. Yeah, so tobacco, Speaker 2 (9:00) the word, actually comes when the Europeans came to North America and then they came across this for the first time. There was this Y-shaped tube they saw the people there smoking with. And I think that was called tobacco. So the word actually came from there. And that's not even the most interesting part of it. The first European smoker actually went to prison for it. And I'll tell you the story of this. The story is this. I hope I pronounce this right. It's Rodrigo de Jerez or Jerez, who was one of Columbus's crewmen, took tobacco home with him to Spain. He was smoking it. Neighbors saw smoke pouring from his mouth. And guess what they assumed? He must be the devil. Right? Because this is pre-science world. And the Inquisition jailed him. Because he thought he was a devil because he had smoke coming out of his mouth. Because who the hell does that? And by some accounts, he was in jail for almost seven years. But by the time he got out, Europe was smoking. No one thought that smoke coming out of your mouth meant that you were the devil. And, you know, I think the first example of you can't just prohibit this plant. This plant always figures a way out. And this is a great Speaker 1 (10:22) example of that. Yeah, and also, I mean, it's not at all surprising that a lot of people took to it because right after Columbus, a lot of these European powers, you know, the Spaniards, the Portuguese, they all go to Europe. They all go to, sorry, the Americas. And something called the Columbian Exchange happens. Familiar with the term? Speaker 2 (10:43) Yes, I know about, I mean, I wasn't familiar about the Colombian exchange. I always knew it in the context of broadly the European exchange, that Europeans came to America and they brought something and they Speaker 1 (11:00) took something. But Speaker 2 (11:01) what's the Colombian, which is essentially that Europeans came, they brought. Diseases, livestock, ships, guns, etc. And they took a bunch of plants, etc. They Speaker 1 (11:17) bring the pig and the horse and diseases like measles and smallpox. And they take back a variety of crops, right? From maize to potato to tomato to chili and of course tobacco. Speaker 2 (11:38) So Portugal and Spain are Speaker 1 (11:40) already hooked to tobacco. And England's love affair with the crop begins on a slave trading voyage to the Caribbean in the 16th century. And they take the smoking pipes back home. And this is a quote from Gipi's book. The average gallant required so many smoking accessories, including tobacco boxes, knives, tongs, and pipes, that a dedicated manservant was needed to carry them. And the ones who are in favor of the English settling America actually talk up the potential of tobacco as a crop. But the one who makes a real breakthrough in the early 17th century is this guy named John Rolfe, who marries a Native American and plants tobacco seeds that he's got from Trinidad. Do you know who that Native American was? Speaker 2 (12:35) No. Have you heard of Pocahontas? There's a Disney cartoon on Pocahontas. There's a legend of Pocahontas. Pocahontas was this legendary beauty who was the daughter of a chieftain, Paul Hutton, who was the chief of the Native American village. And she was kidnapped by English tobacco farmers and colonialists. And she ended up converting to Christianity and she married this John Rolfe character. And that marriage led to peace between the English colonialists and the Native Americans. And there was this period of eight years where there was no war between them. It was called the Pocahontas Peace Period or something like that. That's really what this marriage meant. Very interesting. I Speaker 1 (13:29) didn't know that. I mean, the name is familiar, but I wasn't sure of the story. Speaker 1 (13:34) So, Rolf is in Jamestown, Virginia, and Virginia is named after Queen Elizabeth I, who was called the Virgin Queen because she was unmarried. Rolf learns how to plant and cure tobacco from his in-laws, who are quite familiar with the crop. And he exports his tobacco back to England, where it becomes all the rage. You really can't overstate the importance of tobacco in the European colonies. Here's an article from New York Times in 1941. Tobacco became not only the money crop of colonial Virginia, but money itself. It paid for two shiploads of maidens sent over from England to become the wives of colonists and the mothers of young Virginians. From Africa, it brought slaves, from London, goods, candles and books. It produced finally a civilization and the civilization produced ideas. And the ideas produced a revolution. All just because of one crop. And in the 19th century, America has been independent for a while. And cigarettes start to become really, really popular. And the country's top cigarette maker, this company called Allen & Ginter, announces a competition for a cigarette making machine. Right now, cigarettes are hand rolled. So they announce a competition because they want to up their production and there is no such machine. And a 21-year-old named James Bonsack enters the competition, designs a machine, and he wins it. I have a very Speaker 2 (15:09) interesting anecdote about Allen & Ginter. Right. They funded it. The price was $75,000. And ironically, they never ended up accepting the machine that was designed by John Bonzac. Right. Instead, what happened is a new person whose name was James Bushanon, quote, Duke, Buck Duke installed it. He renegotiated the royalties. And within just five years. Speaker 2 (15:42) American Tobacco was selling 2 million cigarettes a day. So this company that actually funded the machine missed out on the opportunities that it generated. What a miss. Speaker 1 (15:55) Yeah, and we will revisit Allen and Ginter a little later in the story. That 2 million cigarettes a day is a big deal because at this point, like I said, cigarettes are hand-rolled. And even the most skilled worker can only roll about 5 cigarettes a minute. And this machine makes about 200, 212 to be precise, cigarettes a minute. Speaker 2 (16:21) Yeah, and this is a game changer because after this machine, I mean, once he gets to know that the Bonzac machine sort of works, Buck Duke apparently asks for an atlas. Bring me an atlas. Because he's got this powerful, he's got this power with him and he looks at the atlas, he looks at countries around the world and their populations. to decide where he's, which ones he's going to target with his new invention and machines and cigarettes. And of course, India is one of those countries that he spots as well. Buck Duke. Interesting fact, he is the person whose name is behind Duke University. Did you know that? Speaker 1 (17:09) Didn't make that connection. Speaker 2 (17:11) So, Speaker 1 (17:12) cigarettes help Speaker 2 (17:14) build Duke University. So you talked about America, the country, ultimately tracing its, you know, I mean, ideas and revolution. The Speaker 1 (17:26) economic foundation. Speaker 2 (17:26) Economic foundation to cigarette. Duke University did that. The Duke Endowment renamed Trinity College in 1924. So there you have it. Cheap hand-rolled cigarettes to machine-rolled cigarettes to a university in just one generation. Speaker 1 (17:44) And also, I think he didn't have to necessarily go looking for a market because America itself had become huge, right? Rising birth rate, a huge influx of immigrants, and the government was very kind to cigarettes at this point. And across the Atlantic, another firm called WD and HO Wills also benefits immensely from the Bonsack machine. And this company... makes Gold Flake, which is still around. But Buck Duke, who has risen to the top of the American tobacco industry, is not happy with just being restricted to America. So he tries to undercut wills by selling in America. You know, he has this huge marketing campaign. So Wills and 12 other British cigarette makers formed the Imperial Tobacco Company to compete with Buck Duke's American Tobacco Company in his home market. They actually buy up the few companies that Buck Duke hasn't bought himself. And they even buy up retail stores and make sure that Buck Duke's cigarettes are not stocked there. Right, so it's mutual destruction on both fronts. So they need to figure something out. They need to make a deal so that they both stop bleeding. So they decide, we're going to have our respective monopolies. Buck Duke will get to control America. And these 13 tobacco companies in England will control that market. And then they form another company. called British American tobacco so that they can conquer the rest of the world. And the biggest market in the British empire is up for grabs at this point. Speaker 1 (19:45) The Portuguese introduced tobacco to India in the late 16th century or early 17th century, along with all the other crops that are part of the Colombian exchange. And this is during the Mughal emperor Akbar's reign. By 1618 or so, it's being cultivated on a wide scale near Surat in Gujarat. And then it starts spreading to other parts of the country, to the north and the south. And cultivation and consumption both take off. People take to chewing tobacco and using snuff. And writers and poets start singing tobacco's praise. There's this lovely book called In Those Days There Was No Coffee. A wonderful work of cultural history by A.R. Venkateshwara. And there's a chapter on the use of tobacco in Tamil Nadu and how it took off. And it has an excerpt from this Tamil poem, you know, and here's the translation. The virtue of a needle is not to lose its point. The virtue of saints is to restrain the semen. The virtue of courtesans is music. And the virtue of the scholar's nose is to pinch snuff. Even the word cherut. which is a cigar-like thing, comes from surat in Tamil, which means to roll, right? It doesn't have, you just roll several tobacco leaves to make a cheroot or a surat. By the late 19th century, Indians across the country are familiar not with smoking tobacco, but opium. And very few have actually seen a cigarette at this point. They use hookah, beedi, and even suratam, right? And this is the market where Wills, which is part of the group or the consortium in Britain, it actually decides to test the waters in India. And it sends a salesman, this is in the 1880s or so, to promote its scissors brand of cigarettes in India. Indians are not familiar with cigarettes at all. but they want to just see if they can sell cigarettes here. And this is what gives British American Tobacco the company that's formed as a result of the truce, which also includes wills, the confidence to send two representatives. from London to Calcutta in 1906 to find an agent for their business. Calcutta is still the capital of British India. It's the last years before they relocate the capital to Delhi. So the initial response to British American tobacco or BAT cigarettes in India is encouraging. So they expand their operations. They include, you know, manufacturing cigarettes, procurement and processing of tobacco. So they finally set up a company for India. It's called the Imperial Tobacco Company of India. Not very creative, but it does the job. The company is set up on the 24th of August, 1910. Its initial brands are Scissors, Waverly, Sensense, Sportsman and Elephant. But remember, cigarettes are still somewhat alien to Indians, right? They don't know how to smoke this thing. And Imperial has to do a lot to persuade them. There's an interesting bit in this book, which I believe is the official history of ITC. It's called Challenge and Change the ITC Story by Champakabasu. And there's this quote in the book. It says, those who set out to convert Indians to smoking, selling at first was mainly a question of giving away samples, literally by the millions. A district salesman was not considered worth a salt unless he gave away free samples of between 50,000 and 100,000 cigarettes each month. Right? And that's not all. The salesmen have to teach them to smoke cigarettes. Have you smoked BDs? Speaker 2 (23:51) I do not think I've smoked BDs. Speaker 1 (23:53) Okay, so if you have smoked one, you'll know that the way you smoke a BD is very different from how you smoke a cigarette. How? Because BD is, you know, tobacco rolled in tendu leaves. It's not very porous. So you have to keep taking these big drags very frequently. Speaker 2 (24:13) Otherwise it dies out. Yeah. Speaker 1 (24:15) Or you have to keep lighting it again and again. You inhale that into your lungs, whereas when you smoke a cheroot or a surat or a cigar, you don't inhale the smoke. Speaker 2 (24:25) What do you do? Speaker 1 (24:26) You just keep it in your mouth. Speaker 2 (24:29) Huh, I didn't know that. Speaker 1 (24:30) Yeah, so all these different things, right? So cigarettes, obviously you have to inhale it into your lungs, but you don't have to take these deep drags off it. So they need to teach them. And it doesn't have to be lit every minute or so. So they have to literally train them how to smoke this new thing called cigarettes. Speaker 1 (24:52) This reminds me of something really funny that happened in college when obviously a lot of us were, you know, discovering cigarettes. This friend of mine, he wanted to look cool at a party. He asked for the most expensive cigarettes to be bought, the pack of 20. He takes it out and he says, and another friend asks him, can I light it? He says, sure. He gives him the cigarette like this to light it, okay. And he never ever lived that down because he didn't know that you have to obviously keep it in your mouth to light it. By 1911, Imperial Tobacco Company has a factory, a cigarette factory in Munger, in Bihar. And a couple of years later, they set up another in Bangalore. And around the same time, they start sourcing tobacco from farmers near Guntur, which is in Andhra. And this is the start of what will become an agri-trading, agri-sourcing empire decades later. And the earliest sign the company wants to control the entire tobacco value chain, we talk about backward integration today. But right then, ITC was, you know, imperial tobacco company rather, was very sure that it wanted to own the entire value chain. So it actually sets up a packaging and printing business in 1925. And a few years later, it gets its own corporate headquarters in Calcutta. It's called Virginia House. It's obviously a nod to the colony. And the company sort of chugs along through two world wars, the Great Depression and the Freedom Movement. And when India becomes independent, Speaker 1 (26:37) It doesn't look upon these foreign-owned companies quite favorably, and understandably so. And here's a company that's called Imperial Tobacco Company of India. Luckily for the company, in 1948, a year after India becomes independent, it hires a 23-year-old who will go on to reshape the fortunes of Imperial Tobacco Company. And that guy is Ajit Narayan Thaksar. Rohan, the Ken has had its own version of reinvention. We're not as big as ITC nor are we as old. But in these 10 years, the Ken has gone from one deeply reported long-form story a day to several stories, a bunch of newsletters, audio podcasts, events, and even workshops. Speaker 2 (27:23) It's been quite the ride. We'll be 10 in a few months. And there have been some tense moments along the way. But hey. I'd absolutely do it again. And in fact, we are doing it Speaker 1 (27:35) again with Intermission. Yeah, a long-form video podcast. The amount of work that goes into this. We spend months researching the histories of these companies. We talk to a bunch of people. There are multiple teams at the Ken working together to make this happen. None of this would have been possible without Zerodha's support. And we have many more episodes coming. And I look forward to all the work that we're going to have to put in and to Zerodha's continued support. Speaker 1 (28:04) Haksar is raised in Gwalior in a Kashmiri Pandit family of Persian, Urdu and Hindi scholars. His great-grandfather, in fact, taught the grandfather of Madhav Rao Sindhya, who would go on to become a minister in the Congress government. And he has a very interesting cameo in the ITC story, but we'll get to that later. Haksar's cousin, P.N. Haksar, will become an influential bureaucrat as Indira Gandhi's principal secretary. Haksar goes to the elite Dune school, which at this point is India's Eton. After that, he goes to Allahabad University. He then works with, he goes to the US, works with JWTJ Walter Thompson, an ad agency in New York. And then he possibly becomes one of the first Indians to go to Harvard Business School in the late 40s. And then he's looking for a job. He wants to come back to India. He hits up his older brother, who in fact gets him a meeting with JRD Tata. Speaker 1 (29:15) And he does get a job with one of the Tata companies in Bombay. But even then, Bombay is super expensive. So he wants a flat as part of his compensation. The Tata say no. So he turns down that job. And then I think on his way back home, he meets a friend from Dune who works with Imperial Tobacco Company, which he hasn't heard of. And his friend tells him to apply for a job there. And he does. And he gets the gig. He lands a job as a sales pupil at Imperial Tobacco Company. Pupil? Yes. Sales pupil. Speaking Speaker 2 (29:57) of the Huxers. It's a very interesting story of how both of them, both cousins, Ajit Haksar and P.N. Haksar, landed on two very opposite sides of the equation. While Ajit Haskar was working for a British tobacco company from a building called Virginia House, once the origins of it were imperial, his cousin P.N. Haksar became Indira Gandhi's chief strategist and actually was responsible for... the bank nationalization moves and the abolition of the Privy Purse, etc., among various other things. So there you had like sort of two cousins, one of whom was in many ways the architect of socialism and the other one was in some senses trying to survive it. Speaker 1 (30:44) And that will impact ITC too. Speaking of sales pupils, right, the pupil is the term ITC has for management trainees at this point because it's a British company. I mean, it's with a British legacy. And that's the norm in the company for a very long time. I believe even until the 80s, I spoke with someone who worked there for three decades. And in the 80s, some engineers straight out of college who are hired by ITC have a problem with this term. Because they're like, we're doing a bunch of things. Why we call pupils? So then ITC changes the term to assistant under training. Speaker 1 (31:29) Huxer interestingly joins the company at a very, very turbulent time. In 1948, India levies taxes on cigarettes for the first time, as a result of which prices go up. And Imperial Tobacco Company actually starts losing market share to cheaper local brands. I think in the late 1940s, its market share is something like 90%. And within a decade and a half, it's down to 30 to 40%. And this is what... Huxer talks about in his memoirs. It's called Bite the Bullet. Things are so bad that in Eastern India, which is Imperial Tobacco Company's home territory because it's headquartered in Calcutta, its market share is down to 15%. There are brands like... Who gets the rest of the market share? So there's Golden Tobacco, which has Panama. It becomes really, really popular. And so does Charminar by Vaziv Sultan Tobacco, which is in Hyderabad. It's actually an associate company of BAT. And Godfrey Phillips for Square. I have an interesting Speaker 2 (32:37) factoid for you. Did you know Golden Tobacco was quote-unquote the original Swadeshi project around tobacco? It was founded in 1930, and you're not going to believe this, by a person called Narsi Monji. Speaker 1 (32:54) Have Speaker 2 (32:55) you heard that name before? Yes. Speaker 1 (32:57) Because Speaker 2 (32:58) there is, he too decided to, there is a college which is called the Narsi Monji Institute, NMI-MS. That's the second example of cigarettes leading to universities. We had Duke University, now we have Narsi Monji and I found that incredibly interesting. Speaker 1 (33:19) Fascinating. I mean, someone in Bombay, you... It's impossible not to have heard of NMIMS. Going back to Imperial Tobacco Company, it's in a funk. You know, the competition is really, really bad. And then in 1954, the company goes public. And British American Tobacco sells about 6 % of the company to other investors. So it owns about 94%. And Life Insurance Company... which is formed after India nationalizes insurers, both domestic and foreign, and forms this company. LIC ends up buying shares in Imperial for the first time in 1958. Little does LIC know at this point, or Imperial for that matter, that this will go on to become LIC's fourth largest investment by value. This is also when Huxer rises through the ranks fairly quickly. even if it's still a British company that doesn't quite treat Indians as equals. He's one of the strongest advocates for market research, which is a discipline that's sort of unheard of at this point within the company. And he wants to use this to improve Imperial's position in the market. And in a market where people are smoking mostly filterless cigarettes, Imperial launches Will's Navy Cut Filter Tipped in 1963. I want to say this is what the doctor ordered, right? But it sounds inappropriate. But in fact, that's what cigarette companies have been claiming for a while at this point, right? While filters do prevent tobacco flakes from getting in your mouth, cigarette companies are... have begun saying that it's also safer for you. It's cleaner and it's safer. You know, this is not even the end of Speaker 2 (35:19) it, right? If you think that cigarette companies claiming that filters are safer, let me give you the example of what happened in America where there was this filter called, the cigarette called the Kent's Micronite, where the filter was made of Speaker 1 (35:37) blue asbestos. Oh my God. Speaker 2 (35:40) Right? And I mean, asbestos, as we all know, is one of the most deadliest things. And it was advertised as, quote, the greatest health protection in cigarette history. So the concept of Speaker 1 (35:55) the filter protects you is Speaker 2 (35:58) just, you know, it's a myth, it's a marketing and you have blue asbestos here. Speaker 1 (36:04) Yeah, I mean, I understand why they're doing all this because the link between smoking and lung cancer has, you know, has been debated for a while by the 60s, right? There are studies, you know, there are people calling out cigarette companies. And then finally, you know, in 1962, the UK's Royal College of Physicians actually confirms the link. And two years later, the US Surgeon General does the same. This is a watershed moment. The US also makes warning labels on cigarette packaging mandatory in 1965. And Imperial knows it's only a matter of time before this starts happening in India as well. So it knows that it has to launch a charm offensive to popularize Will's Navy Cut Filter Tipped in 1965. And it has an iconic tagline, the campaign. It's called Made for Each Other. Speaker 2 (37:09) Advertising, we're back at it. What a better way to sell things, right? Now, Made for Each Other, did you know, was one of those lines that was