The first and only Marshall McGearty Tobacco Lounge has opened In Chicago, offering customers custom-made, blended cigarettes.
By Brian Louis

Tobacco companies are not strangers to introducing cigarette brands. But R.J.Reynolds Tobacco Co. has come up with an unusual twist. On Wednesday, Reynolds opened the Marshall McGearty Tobacco Lounge in Chicago, showcasing its new premium" Marshall McGearty Tobacco Artisans brand.

The same day, the Chicago City Council passed a law that bans smoking in many public places. But Reynolds' lounge is defined as a re tail tobacco store and is exempt from the new law.

"We're pleased that we're not going to have to change our business model," Brian Stebbins, a marketing manager at Reynolds, said yesterday.

The proposal to ban smoking in the Chicago's restaurants and bars was a fight primarily between health groups and the restaurant and bar industry and other business groups a battle that is increasingly taking place around the country.

Reynolds hired its own lobbyist to fight the ban.

Stebbins said that plans for the lounge in Chicago were being worked on long before the smoking- ban issue started gaining steam.

Colleen McShane, the president of the Illinois Restaurant Association, said that the draft of the controversial States that have laws banning smoking in restaurants and bars: California Connecticut Delaware Florida* Idaho* Maine Massachusetts Montana* New York Rhode Island Utah- Vermont

Marshall's signature blend cigarettes are named The Standard. Despite more laws restricting the sale and use of tobacco products, Reynolds Tobacco is pressing ahead with new marketing ideas.

The ordinance was constantly changing up until the vote as both sides tried to reach a com promise.

The smoking ban in restaurants and bars does not go into effect until July 1, 2008. After that date, smoking would be permitted if the restaurant or bar installs an air-filtration system that meets standards that will be specified by the city.

The Marshall McGearty lounge already has a powerful ventilation system, said Fred McConnell, a spokesman for Reynolds.

The Marshall McGearty lounge is no ordinary smoke shop. It has a tobacconist on site, and it has small cigarette- making devices where customers can custom-order packs of cigarettes costing $8 each, including taxes.

The company is trying to educate smokers on the finer points of tobacco and blends.

Marshall McGearty cigarettes are available only in the Chicago store.

"It wouldn't work if it were something on a rack in a gas station," Stebbins said.

The company is trying to at tract smokers who have a premium-product mindset, Stebbins said. He said that the customers it is after tend to be creative, expressive people who pay attention to the products they consume.

"It spans a lot of different groups of people," he said.

Stebbins said that the places where smokers can feel comfortable are becoming rare and the lounge is a place where smokers are welcome and where they can enjoy them selves.

"We're calling it a smokers' paradise," he said.

The tobacconist is there to explain to customers the different blends of tobacco available in the store, and customers can order their own fresh, custom- made cigarettes.

"This is the only place in the world where you can get that," Stebbins said.

The lounge also sells cigarettes already made in seven different styles.

The lounge offers some light food, baked goods and a selection of coffee beverages, including lattes and espressos. Mc Connell said that the lounge also plans to offer alcoholic beverages.

The lounge has cafe tables, but also leather couches and fireplace, Stebbins said. He said that the lounge has a warm and inviting look and is plush.

For now, the company plans to test the store and see how the brand does before potentially expanding the concept.

If the concept does take off and the company decides that it would like to open more lounges in other cities, its opportunities may be limited.

The trend of local governments enacting smoking bans is "sweeping the nation," said Annie Tegen, a senior program manager for Americans for Nonsmokers' Rights, an anti- smoking group.

Tegen said that strong anti- smoking laws are being passed by local governments from coast to coast.

But in most cases those bans do not include retail tobacco stores, McConnell said.

That would be good news for Reynolds if it expands the Mar shall McGearry concept to other cities where its lounge could be classified as a retail tobacco store.

The brand and lounge are named after Jerry Marshall and Larry McGearty, the two men who came up with the idea. Marshall is a senior staff blends specialist in Reynolds' research and development department, and McGearty is the creative director for Quaker City Mercantile, an advertising agency.

"If the brand does well, it could be an important contributor to Reynolds American's bottom line," Stebbins said.