Tobacco in Business and Industry

Tobacco: A Growth Industry

Title page for "The Case of the Planters of Tobacco in Virginia," London, Printed for J. Roberts, 1733

The earliest European settlers in the Jamestown colony discovered that tobacco made for a profitable export. Tobacco was a valuable commodity from the onset of colonization in North America, and was often used as currency. It even helped finance the American Revolution, serving as collateral for loans from Europe. In the early 17th century, planters refined the crop, importing seeds from Caribbean and South American varieties to develop plants that pleased their European consumers. Before 1760, when Pierre Lorillard established a company to mass produce pipe tobacco, cigars, and snuff, the majority of tobacco products used by the colonists was processed in England or Scotland or made in small local factories. With the growing popularity of smoking, other manufacturing plants soon appeared.

At twenty-seven years of age, with less than $100,000 capital, Mr. Duke went to New York where the large tobacco interests were well entrenched. At first his presence was unnoted, but not for long. He became a competitor; commercial war within the tobacco trade ensued. "At thirty-four years of age the competing interests were consolidated and Mr. Duke was elected President of the American Tobacco Company. Ninety percent of the output of the Company was cigarettes which was considered too narrow a base for commercial stability. Diversification followed and the Company expanded to include every kind of tobacco product, cigarettes, cigars, smoking and chewing tobacco, and snuff." Watson S. Rankin

An increasing penchant for small paper-rolled cigars popular in Spain prompted Phillip Morris to market the first American hand-rolled cigarettes in 1847, and soon other companies like J. E. Liggett & Brothers were manufacturing their own cigarettes. In 1875 R. J. Reynolds began to produce chewing tobacco.

Technological advances and new machinery allowed tobacco companies to increase production in the latter half of the 19th century, and by the early 1900's cigarettes and cigars were the most prevalent tobacco products available.

World War II era advertisement for Camel cigarettes titled "Danger Aunt Nellie's Upstairs"

The market exploded during the First World War (1914–1918). World War II (1939–1945) saw cigarette sales hit record highs with the production of several popular brands, Camel, Lucky Strike, and Pall Mall. In the 1950's, Kent, Winston, and Salem, the first filter-tipped menthol cigarette, entered the market and became top sellers. Despite negative advertising promoted in the 1960's and 1970's, as well as the current lawsuits filed against tobacco companies, the industry continues to flourish. Tobacco products are widely marketed outside the United States, allowing tobacco its place as a valuable commodity for export in the American economy.