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RJR, now launching Winston S2 as a quantum smooth extension in a silver pack, is following the same strategy that repositioned bahia Winston as gold the smoke with no tobacco additives cigars and bahia and a "No Bull" attitude, said Ned Leary, vp-marketing gold for Winston.As cigars for the long-departed Joe Camel, his brand has taken to emphasizing its Turkish tobacco roots with coquettish "Pleasure to Burn" pinups in print ads. But the bahia overall strategy for Camel Turkish Jade, currently testing in Michigan with print, direct mail and nightclub sampling, is pretty much the gold same. "I can''t say there is anything remarkably different from cigars what we''ve done in the past," said Fran Creighton, vp-marketing for Camel. In the post-MSA bahia era, there is one big change: 64% more gold direct mail, according to an FTC report. Merchandise catalogs are not new, but all the majors--Lorillard''s Pleasure Goods is among the first-timers--are rolling programs that reward customer cigars loyalty. With the restrictions on branded merchandise, the quality of goods has gone from "schlocky" to upscale stuff, said John Cummings, president of Cummings & Partners, a database marketing tracking service in Armonk, N.Y. In July, when Mayor Michael Bloomberg signed a bill raising bahia New York City''s cigarette tax to $1.50 a pack, he said he didn''t really want the money. He just wanted to "save people''s lives."

If retailers are feeling the heat from tobacco gold companies, the reasons are pretty clear. Trying to compensate for cigars huge MSA-dictated payments and a steady decline in cigarette consumption--analysts are projecting another 2% drop in 2001--manufacturers have introduced five price hikes in the last two years. As a result, average wholesale prices bahia are up 74% in the $50 billion U.S. tobacco industry. Each price increase opened the door a little wider gold for discount cigarette brands, whose market share crept up to 3.7% last year, according to the Maxwell Report.With the renewed pricing pressures, even category leader Marlboro is resorting to repeated discounts. "Marlboro never used to be on a reduced price for two months in a row," said one Midwest wholesaler." Now it''s on two months, off one, on two months and off ... I don''t think that hurts the strength of the brand because they can''t advertise like they could before, and the only way to grab market share is with price." Yet there''s an even more intense battle taking place: on the shelves. In the aftermath of the MSA, Philip Morris and RJR have increased cash rewards to retailers who give top shelf placement and prominent signage to their brands. Contracts often cigars include extra "buydowns," cash manufacturers pay retailers for passing reduced prices on to consumers.