c 



yearly for Duke. After this, Duke captured 40 percent 

 of the nation's cigarette business, and for the first time, 

 the South moved ahead of the North in tobacco manu- 

 facturing. After it was perfected, Bonsack's machine 

 could make 120,000 cigarettes daily— more than 50 times 

 the capability of one hand roller. 



ompetition througti advertising 



Realizing that urban areas provided the best ciga- 

 rette markets, Duke opened a New York City office. He 

 set up a loft factory on Riverton Street— not far from the 

 Bowery— and began what was regarded as a daring ad- 

 vertising and marketing campaign. Major Lewis Ginter, 

 of Allen and Ginter, was the advertising genius of the 

 time— his reputation was world-wide. Rival manufac- 

 turers had put puzzles, pictures of world rulers, flags, 

 actors and actresses and other attractive displays in 

 cigarette packages. Allen and Ginter had been distribut- 

 ing a fancy premium booklet portraying various types 

 of world architecture. But the Temple of Kom Omhoo 

 hardly had the appeal of the folding color album en- 

 titled "Sporting Girls," distributed by W. Duke Sons 

 and Company in exchange for 75 boxes of cigarettes. 



f YouL Can't Beat 'Em-Join 'Em" 



In 1889, Duke was spending close to a million dollars 

 in advertising. In 1890, knowing that they could no 

 longer compete with Duke, other major tobacco com- 

 panies merged with him and formed the American 

 Tobacco Company, incorporated in New Jersey. Under 

 the leadership of Duke as president, the company intro- 

 duced a rigid system of cost accounting, jobbers' profits 

 were reduced, and leaf was purchased directly from the 

 growers rather than through dealers. Earnings for the 



21 



