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Abstract
Introduction Monitoring the activities and impacts of tobacco industries is vital for tobacco control. Based on tobacco industry financial statements and a nationally representative survey of Korean adolescents, we examined the association between tobacco industry commercial advertising expenses and advertising exposure among Korean adolescents.
Methods The commercial advertising expenses of three major tobacco industries in Korea (KT&G, Philip Morris Korea, and British and American Tobacco Korea) were identified in a repository (Data Analysis Retrieval and Transfer System) established by the Korean Financial Supervisory Service. The yearly advertising expenses were merged with data from the Korean Youth Risk Behavior Survey (2015–2018 and 2021, total N=309 190). We used logistic regression analyses to analyse the associations between tobacco industry advertising expenses and adolescent tobacco advertisement exposure.
Results In 2021, the total advertising expenses of the three companies exceeded US$260 million, and the proportion of Korean adolescents exposed to tobacco advertisements ranged from 65.9% to 78.7% during 2015–2018 and 2021. Higher advertising expense sizes were associated with the risk of exposure to tobacco advertisements in both girls and boys, with OR of 1.009 (95% CI (1): 1.008 to 1.010) and 1.010 (95% CI: 1.009 to 1.011), respectively.
Conclusion Tobacco industry advertising expenses are associated with tobacco marketing exposure among adolescents. We used financial data to identify the reach of tobacco advertising among Korean adolescents. It is essential to increase tobacco industry surveillance using various data sources and to regulate tobacco advertising more strongly.
- epidemiologic studies
- public health
- epidemiology
Data availability statement
Data are available in a public, open access repository. All financial data described and used in this study are publicly available from the cited sources. KYRBS data are also publicly available on the KDCA website (https://www.kdca.go.kr/yhs/home.jsp).
This is an open access article distributed in accordance with the Creative Commons Attribution Non Commercial (CC BY-NC 4.0) license, which permits others to distribute, remix, adapt, build upon this work non-commercially, and license their derivative works on different terms, provided the original work is properly cited, appropriate credit is given, any changes made indicated, and the use is non-commercial. See: http://creativecommons.org/licenses/by-nc/4.0/.
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Strengths and limitations of this study
Financial statements provide authentic, structured, routinely collected and easily accessible information on the commercial interests of tobacco industries.
The commercial advertising expenses of Korea’s three major tobacco companies were merged with data from a large, nationally representative survey of Korean adolescents to examine the relationship between their exposure to tobacco advertising and tobacco industry advertising expenditure.
Financial statements provided tobacco industry incomes, sales revenues and advertising expenditures. However, the data are usually overviews, which lack detailed information.
Because this was a cross-sectional study, causes and effects cannot be inferred from our findings.
Introduction
Tobacco control research commonly focuses on human behavioural changes and the impacts of human behaviours on health.1 2 However, pervasive efforts of the tobacco industry to render tobacco products available to both existing and potential users highlight the need for detailed analyses of industry activities.3 In this study, we took the novel approach of using industry financial data. Such data are often employed to understand a corporation’s profitability and overall performance.4 Attempts have been made to use financial information in other research spheres, such as business studies. For example, some studies used financial statements to analyse the business performances of Korean sports industries.5 6 However, the use of industry financial information for monitoring tobacco industry activities has not been extensively employed in tobacco control research.
Tobacco advertising is a key industry activity. The exposure of adolescents to such advertising is associated with positive perceptions of tobacco7 and increased risks of current and future smoking.8 One meta-analysis examining the association between point-of-sale (POS) tobacco promotion and adolescent smoking reported that the risk of smoking experimentation increased 1.6-fold and the risk of future smoking 1.3-fold among adolescents thus exposed.9 Adolescents are particularly vulnerable to marketing activities,10 and smoking at an early age can trigger several immediate negative outcomes and chronic health conditions later in life.11 Thus, tobacco industry advertising activities that impact adolescents must be examined and controlled.
Financial data such as financial statements afford three main advantages. First, financial information is qualified and systematically structured. Each corporation is required to file and publish an annual financial report;12 this must be completed by a third party, such as a registered accounting firm.13 A financial report includes structured financial statements with templates that vary by country; these usually include a balance sheet, an income statement and cash flow data.4 Because financial information is filed in various forms depending on corporate governance requirements, researchers can refer to multiple types of reports. For example, a holding company running more than one subsidiary company is required to disclose two types of financial statements: consolidated and separate.14
Second, annual financial reports are readily accessible and useful when comparing the financial estimates of different tobacco industry businesses. Financial data can be acquired through official government websites, such as Electronic Data Gathering Analysis and Retrieval (EDGAR)15 developed by the United States Securities and Exchange Commission and the Data Analysis Retrieval and Transfer System (DART)16 of the Korean Financial Supervisory Service (FSS). The databases include national to international level data according to the locations of the relevant companies’ headquarters.
Third, financial data indicate the commercial and other vested interests of the tobacco industry. Therefore, such data can be used to monitor and enforce bans on industry activities. As financial data provide monetary details on commercial activities, including advertising and promotion expenses, they can play an important role in tobacco control. The MPOWER framework, established to facilitate the implementation of national-level interventions for reducing tobacco demand as outlined in the WHO Framework Convention on Tobacco Control, recommends enforcing bans on tobacco advertising, promotion and sponsorship (TAPS).17 To effectively do so, monitoring the industry’s marketing activities is crucial. Examinations of tobacco industry financial estimates can facilitate the preparation of pre-emptive responses to tobacco industry activities.
In South Korea, the display or posting of tobacco advertising materials is allowed within the premises of tobacco retailers provided that the advertisements are not visible from outside.18 Thus, anyone visiting a retailer that sells tobacco products (ie, convenience stores, supermarkets or specialised shops selling vapes and/or heated tobacco products) may be exposed to tobacco advertisements. Advertising in magazines and newspapers is also allowed if the target audiences are not women or adolescents. The National Health Promotion Act18 also permits tobacco advertising in aircraft or ships on international routes. Other forms of advertising (eg, online) are prohibited. The contents of advertisements are regulated: information is limited to brand name, type and features; the material must not encourage non-smokers to start smoking and must not portray a woman or an adolescent; the material must respect what is stated in warning labels; and the material must not make any unverified health claims. The extent of compliance is unclear. However, as the law requires a manufacturer or importer to voluntarily comply with the regulations,18 and as few governmental measures seek to ban tobacco advertising, promotion and sponsorship,19 compliance is likely poor.
In this study, we examined the association between commercial advertising expenses of tobacco industries and exposure to such advertisements among South Korean adolescents. We retrieved the commercial advertising expenses of the three major tobacco companies in Korea (KT&G, Philip Morris Korea (PMK) and British American Tobacco Korea (BATK)), from the DART database.16 The annual advertising expenses were merged with data from a nationally representative survey of the health behaviours of Korean adolescents. To facilitate the use of financial information by tobacco control researchers, detailed information regarding financial data is provided in online supplemental material 1.
Supplemental material
Methods
Data sources and study participants
We extracted and summed the commercial advertising expenses of the three major Korean tobacco industries from DART financial statements. DART, established by a Korean governmental agency, is a comprehensive corporate disclosure system enabling listed companies to submit reporting documents online; these financial data are publically accessible. The statements are reviewed by the Disclosure Review Office of the FSS.20 The commercial advertising expenses of the tobacco industry were used as the main explanatory variables. In these financial statements, ‘commercial expenses’ generally include advertising, promotion and market research expenses.21 22
Information on exposure of adolescents to tobacco advertising and covariates were retrieved from the Korea Youth Risk Behavior Survey (KYRBS), a nationally representative cross-sectional survey conducted by the Korea Disease Control and Prevention Agency (KDCA) that assesses Korean adolescents’ health and health-related behaviours.23 School-attending adolescents aged 12–18 years are stratified by school type (middle, high and vocational high) and region.24 KYRBS data are collected using online self-administered questionnaires available in the computer laboratories of all schools from August to October (data were collected in June prior to the COVID-19 pandemic). All participants gave written informed consent before participating in the KYRBS. The KYRBS participation rate has exceeded 90% every year since 2006. When the annual data collection is complete, the KDCA evaluates data quality for logical errors, outliers and non-responses. The KYRBS data were fully anonymised before public release and further details of the KYRBS are provided elsewhere.23 We used data from 2015 to 2018 and 2021 based on the availability of a question that evaluated exposure to tobacco advertising. The sample size ranged from 54 848 (2021) to 68 043 (2015) and the merged data set for 2015–2018 and 2021 contained information on 309 190 participants after the deletion of participants of unknown ages (n=1545).
Patient and public involvement statement
We used secondary data from KYRBS which is an anonymous self-administered online survey organised by the KDCA. Therefore, this study does not include patient and public involvement.
Measures
Tobacco advertising exposure was the outcome variable. In the KYRBS, participants were asked, ‘In the past 30 days, have you seen a tobacco advertisement?’. This question allowed multiple answers (ie, ‘magazine’, ‘internet’, ‘convenience store’ or ‘supermarket’). Participants who had seen no advertisements replied ‘haven’t seen any’. Because our main outcome variable was exposure to any tobacco advertising, ‘haven’t seen any’ was reverse-coded as a dummy variable in terms of exposure to tobacco advertising. The descriptive estimates of exposure by year are presented in table 1. Figure 1 and online supplemental material 2 show exposure by source and user group, respectively.
Commercial advertising expense trends among the principal South Korean tobacco companies
Adolescent exposure to tobacco advertisements by source.
The covariates were sex, age, economic and residential status, exposure to any anti-smoking campaign, tobacco purchase source and any experience of school-based efforts to prevent smoking. Age was considered as a continuous variable. Economic status was divided into low, low-to-middle, middle, middle-to-high and high according to the perceived household economic status. Economic status was determined according to responses in the descriptive table, but was treated as a continuous variable in regression analysis. Residential status was divided into ‘with family’ and ‘with others’ (ie, a relative, friend or significant other). Exposure to any anti-smoking campaign was scored yes/no. Tobacco source options included ‘acquired from a friend’s house or my own house’, ‘bought from a store’, ‘borrowed from friends’, ‘borrowed from adults’ and ‘picked up in the street’. As sources were sought only from smokers, we recoded this variable as ‘not smoking’, ‘bought from a store’, ‘acquired from social sources’ (all other responses excluding ‘bought from a store’). Exposure to school-based smoking prevention efforts in the past 12 months was scored yes/no.
Statistical analyses
We used weighted estimates of the adolescent population of Korea. Descriptive statistics are provided as unweighted frequencies with weighted percentages by sex and overall. The correlations among all variables were examined to avoid multicollinearity (all correlations were <0.7). To identify the association between commercial advertising expenses and exposure to tobacco advertising, we performed logistic regression analyses by sex with adjustment of all covariates. The advertising expenses were rescaled to 1 billion Korean won (KRW). Annual Korean inflation rates were adjusted to reflect changes in monetary values.25 Interactions between commercial advertising expenses and tobacco sources were assessed to determine whether the association between advertising expenses and advertising exposure varied by tobacco source. Because the ‘source of tobacco acquisition’ included ‘non-smoking’ (as described above), we were able to assess whether the association between advertising expenses and exposure to tobacco advertising differed by smoking status. ORs with 95% CIs are provided. Two-sided p values were used to determine statistical significance. All statistical analyses were conducted using the survey package in R V.4.1.0 (R Core Team, Vienna, Austria).
Results
Among the three major tobacco companies, KT&G had the highest expense for commercial advertising (table 1). The total advertising expense of all three tobacco companies was 339 499 000 000 KRW, that is, more than US$260 million. The advertising expenses decreased in 2021, particularly those of PMK and BATK. However, the advertising expense of KT&G was highest in 2021, exceeding 300 billion KRW. BATK reported large figures in 2017 (1.36 billion KRW) and 2018 (2.96 billion KRW), but these decreased to 654 million KRW in 2021.
A descriptive analysis of the adolescents included in the survey is provided in table 2. Exposure to tobacco advertisements increased steadily from 67.8% in 2015 to 78.7% in 2017, but decreased from 2018 (78.0%) to 2021 (65.9%). More girls than boys were exposed to tobacco advertising in 2018 (girls 79.9% vs boys 76.2%) and 2021 (girls 68.9% vs boys 63.1%).
Socio-demographic and tobacco-related characteristics of all survey participants
The sources of tobacco advertising exposure are shown in figure 1. The annual statistics showed that convenience stores were the principal sources, followed by the internet, supermarkets and magazines. Exposure varied by the tobacco product used (online supplemental material 2). Adolescents using both heated tobacco products and e-cigarettes were most highly exposed to tobacco advertisements (79.6%). Exposure to tobacco advertisements were relatively lower among adolescents smoking cigarettes exclusively (68.3%) and not using any product (65.8%).
Logistic regression analyses (table 3) showed that higher tobacco industry expenses were associated with higher risks of advertising exposure in both boys (OR=1.010, 95% CI: 1.009 to 1.011) and girls (OR=1.009, 95% CI: 1.008 to 1.010). We examined the interactions between advertising expenses and sources of tobacco acquisition and we found no significant associations with the risk of advertising exposure in either boys or girls.
Associations between exposure to tobacco advertising, tobacco industry commercial advertising expenses and their correlates
Age was significantly associated with a decreased OR of exposure to advertising in both boys (OR=0.99, 95% CI: 0.98 to 1.00) and girls (OR=0.96, 95% CI: 0.95 to 0.97), as was higher economic status (boys OR=0.93, 95% CI: 0.92 to 0.94 and girls OR=0.97, 95% CI: 0.96 to 0.99). Residential status was not associated with exposure in either sex. Experience with any type of smoking cessation campaign was significantly associated with an increased risk of exposure to advertisements in both boys (OR=3.98, 95% CI: 3.86 to 4.10) and girls (OR=4.13, 95% CI: 3.98 to 4.29). Non-significant associations were observed when tobacco sources were examined. Experience with school-based smoking prevention education was associated with increased exposure to advertising in both boys (OR=1.29, 95% CI: 1.25 to 1.32) and girls (OR=1.41, 95% CI: 1.37 to 1.46).
Discussion
We examined the associations between the commercial advertising expenses of tobacco companies and exposure to tobacco advertising among South Korean adolescents using corporate financial statements and data from a large, nationally representative survey of adolescents. We found a positive association between the advertising expenses and adolescents’ exposure to advertising. The advertising expenses of the three dominant tobacco companies were extremely high and increased from 2015 to 2017, but fell in 2018 and 2021. Approximately two-thirds of South Korean adolescents were exposed to tobacco advertising, principally in convenience stores, followed by the internet and supermarkets.
Our findings suggest a positive association between advertising expenses and exposure to advertising, as did a previous US study reporting that television advertising expenditure and exposure to e-cigarette advertising were strongly correlated among both adults and adolescents.26 Other studies have used tobacco advertising expenditure to explain different outcomes, such as tobacco consumption. One review on the association between tobacco advertising expenditure and tobacco consumption in the general population has been published;27 however, it found no strong association between expenditure and consumption.27 Our results suggest that exposure to tobacco advertising may mediate the relationship between tobacco industry advertising expenses and tobacco consumption. Further studies using a longitudinal design are required to test this hypothesis. A large body of evidence suggests an association between exposure to tobacco advertising and the risk of smoking.28
Adolescents are the key group that must be protected from exposure to tobacco advertising. However, our results indicate that South Korean adolescents remain highly exposed to such advertising. Tobacco advertising exposure occurred mainly in convenience stores; however, that in supermarkets was also substantial. This finding suggests that retail advertising should be eliminated. Banning POS advertising and in-store displays of tobacco products reduce adolescent exposure to advertising. POS advertising has been banned in countries including, Australia, Canada, New Zealand and the UK.29–33 A POS display ban greatly reduced exposure to tobacco advertising34 and triggered declines in tobacco consumption by both adults33 and adolescents.35
The internet was the second-highest source of tobacco advertising exposure among adolescents despite the ban on tobacco advertising online, indicating that the law is poorly enforced. The National Tobacco Control Center annually monitors tobacco advertisements at retail, media and online.36 However, the impacts of such activities on the regulation of illegal marketing remain to be determined. Also, bans on advertising should cover all nicotine products. Our supplementary analyses suggested that the proportion of adolescents exposed to tobacco advertising was higher among those employing two or three tobacco products than those using cigarettes only. Among adolescents using two or more products, exposure to tobacco advertisements was most pronounced among adolescents who used both e-cigarettes and heated tobacco products, surpassing even those who used all cigarettes, e-cigarettes and heated tobacco products.
User exposure differed by the source of exposure. For example, internet-mediated exposure was higher among adolescents who used heated tobacco products and e-cigarettes, whereas exposure in convenience stores was higher among those who favoured cigarettes over e-cigarettes and/or heated tobacco products. Such differences in exposure patterns may indicate that the tobacco industry is making efforts to target young people to consume non-conventional products through online channels rather than conventional marketing sites. Although the financial statements we used were limited in suggesting expenditure per channel, the annual monitoring of tobacco industry marketing activities suggested that advertising in channels (eg, webcomics, YouTube) frequently used by adolescents and young adults were highly prevalent.37
The advertising expenses of tobacco industries and the association between such expenditures and exposure to advertising reinforces the importance of monitoring and controlling these industries. Given that the bans on TAPS is one key strategy to reduce smoking prevalence, it is imperative to monitor the marketing activities of the tobacco industry.17 However, tobacco manufacturers and retailers have received much less research attention than tobacco users or potential users.1 2 Legislation and implementation of control strategies remains challenging; the tobacco industry makes every effort to stay in business.38 The priority indicators when monitoring the tobacco industry included the advertising expense and resultant exposure;38 the association between these was our primary focus.
Our study highlights the fact that financial information may aid research on tobacco control. Most figures used in previous studies, particularly tobacco marketing expenditures, were obtained from US Federal Trade Commission reports26 39 or commercial data sources.40 41 We suggest that company financial reports and statements are also useful. Official documents such as financial statements yield more comprehensive information on overall financial performance. A financial statement typically includes a balance sheet, income and cash-flow statements and details of any changes in equity; footnotes explain the figures.42 Financial statements are routinely collected in governmental databases, such as the EDGAR in the USA, System for Electronic Document Analysis and Retrieval in Canada and DART (South Korea). These data reveal commercial and other vested interests, and allow cross-country comparisons as the data are usually submitted in standardised formats.
Our work had certain limitations. First, in terms of data integration and extraction, KT&G operates multiple businesses including cosmetics and real estate enterprises; it was thus difficult to extract tobacco expenses alone. However, as tobacco manufacturing and sales are their main business focus; we presume that the tobacco advertising expenses obtained from KT&G were adequately covered. Second, commercial advertising expenses were provided as a total amount in the financial statements; it was difficult to distinguish the types of advertisements (ie, internet vs television or retailers). Footnotes in financial statements explain how the figures were attained, but often lack sufficient detail for research purposes. Third, the KYRBS included only school-attending adolescents, not all adolescents. However, the proportion of South Korean youths not in school is only 1.8%.23 Fourth, self-reported measures of tobacco-related variables may be underestimated. Finally, we cannot infer cause and effect relationships given our cross-sectional design. Additional studies on the whole population should merge financial data with information from an integrated population-based survey.
Conclusion
We used financial databases to acquire the commercial advertising expenses of the three major tobacco industries in South Korea. On merging the expenses with survey data, we found a positive association between the expenses and exposure to tobacco advertisements among adolescents. Our approach supports the use of financial data by tobacco control researchers and reinforces the importance of tobacco industry monitoring. To protect adolescents from tobacco advertising, it is crucial to enhance tobacco control policies to limit the tobacco industry’s marketing activities.
Data availability statement
Data are available in a public, open access repository. All financial data described and used in this study are publicly available from the cited sources. KYRBS data are also publicly available on the KDCA website (https://www.kdca.go.kr/yhs/home.jsp).
Ethics statements
Patient consent for publication
Ethics approval
This study was exempt from review by the Institutional Review Board of Seoul National University (IRB No. E2212/004-008)
References
Supplementary materials
Supplementary Data
This web only file has been produced by the BMJ Publishing Group from an electronic file supplied by the author(s) and has not been edited for content.
Footnotes
Contributors HKa, in the role of the corresponding author, designed the study and is the guarantor. H-kN conducted the analyses and drafted the manuscript. All authors interpreted the findings and reviewed the manuscript.
Funding This work was supported by a National Research Foundation of Korea (NRF) grant funded by the Korean Government (MSIT) (grant no. 2021R1C1C2094375).
Competing interests None declared.
Patient and public involvement Patients and/or the public were not involved in the design, or conduct, or reporting, or dissemination plans of this research.
Provenance and peer review Not commissioned; externally peer reviewed.
Supplemental material This content has been supplied by the author(s). It has not been vetted by BMJ Publishing Group Limited (BMJ) and may not have been peer-reviewed. Any opinions or recommendations discussed are solely those of the author(s) and are not endorsed by BMJ. BMJ disclaims all liability and responsibility arising from any reliance placed on the content. Where the content includes any translated material, BMJ does not warrant the accuracy and reliability of the translations (including but not limited to local regulations, clinical guidelines, terminology, drug names and drug dosages), and is not responsible for any error and/or omissions arising from translation and adaptation or otherwise.