Our commitment to preventing youth use of our smoke-free products

Whilst PMI is committed to providing adults who would otherwise continue to smoke with a range of science-based better alternatives to cigarettes, we are emphatic in our message: These smoke-free products are not intended for people who have never smoked, people who have already quit, or anyone below the legal age of tobacco and nicotine use. 

Minors should NOT use any tobacco or nicotine-containing product. This is beyond question. 

To achieve our vision of a world without cigarettes, we must do everything possible to keep our smoke-free products out of the hands of youth. 

Of course, this requires the efforts of all key parties. We strongly support regulation that ensures only adults can buy tobacco and nicotine-containing products, as well as the strict enforcement of minimum-age laws. 

But we also recognize that we, as a company, have a critical role to play in guarding against youth access to our smoke-free products. We do this in several ways: 

• We uphold ourselves to strict marketing codes. These are rooted in the principle that we only direct our marketing and sell our products to existing adult smokers and nicotine users. 
• We have robust requirements of our trade partners. In 2023, 98 percent of our total shipment volume was covered by youth access prevention programs in our indirect retail channels, in line with our ongoing aspiration to maintain greater than 90 percent coverage.¹ 
• Beyond our existing responsible marketing programs, we continue to look for, test, learn, and develop technology to guard against unintended access to product information, purchase, and use to prevent youth from initiating or using our smoke-free devices.
• We use careful product design and labeling. The packaging of smoke-free products clearly indicates that they are only for adults, and we use flavors responsibly in accordance with a central governance process pursuant to which all new flavored product variants are evaluated prior to commercialization. 

Whilst PMI alone cannot prevent people who are underage from smoking or using nicotine-containing products, there is a lot we can do—and are doing—to minimize the extent to which these products are accessible and appealing to them. 

Strict marketing standards  

We are clear about our core principle: We only market our smoke-free products to adult smokers and adult users of nicotine products and do so responsibly. 

To minimize the risk of unintended consequences, our robust Marketing Codes include the following rules:  

• We don’t use cartoons, youth-oriented celebrities, or models who are, or appear to be, under the age of 25. 
• We don’t advertise on the front or back cover of any print publication for general circulation. 
• We don’t engage in product placement in movies or on television. 
• We don’t place the names or logos of our brands on any promotional item likely to be used or seen by minors. 
• We do not encourage adult consumers to share commercial content related to our smoke-free products on their personal social media accounts. 

We rolled out our Marketing Codes in 2021 to ensure all our activities are only directed toward adult smokers and nicotine users, and to minimize the extent to which minors will see our marketing. We published these Codes in 2022. 

We also have a set of internal guidelines that provide more detail, including guidance for markets on how to set up effective youth access prevention programs. 

We never place advertising, marketing, or sales material in media channels for minors. They are only used in locations where at least 75 percent of the audience is reasonably estimated to be above legal age or at least 18 years old in markets without a minimum legal age—and this includes social media platforms. Digital channels are vital for sharing accurate product information with adult users.  

In 2023, we launched a pilot program with digital content creators—adult users who create content such as technical reviews, unboxings, or personal conversion stories. We chose this approach because of social media’s age-gating features, which help ensure the content doesn’t reach unintended audiences. To further ensure this, we used reputable audience analysis tools to confirm that the creators’ social media followers met our strict demographic criteria.  

We don’t conduct research on people under the legal age of purchase and when it comes to monitoring youth access to tobacco and nicotine products we rely on the data and conclusions of independent third parties, including government data. But independent studies have shown that our heated tobacco products, for example, are of limited interest to youth and adults who have never used nicotine products or who have stopped using them—and that we are reaching our intended audience: Those adults who already smoke and continue to do so. 

Robust requirements of our trade partners 

Due to the nature of our business, we do not own or control most outlets where people buy our smoke-free products: 99 percent of our sales are through a third-party retailer. 

To ensure these retailers operate according to our standards, we set robust requirements for our trade partners. We work with them to ensure they understand why they should not sell tobacco or nicotine-containing products to youth. These measures complement local regulations for youth access prevention, which we comply with, and which retailers must enforce. 

Our ongoing aspiration is that more than 90 percent of our shipment volume is to markets with a youth access prevention (YAP) program in indirect retail in place. This is a combination of guidelines and tools to help affiliates work with trade partners to guard against the sale of smoke-free products to underage purchasers. In 2023, markets representing 98 percent of our total shipment volume were implementing such programs, which supplement our Marketing Codes requirements. 

The tools include templates for contracts requiring strict compliance with minimum age laws or, in the absence of such laws, a stipulation that retailers refuse to sell nicotine-containing products to anyone under the age of 18. In 2023, we continued strengthening our youth access prevention program for indirect retail:  

• Increased global footprint: Markets where PMI has minimal business presence are required to comply with the program via distributors or third parties where such deployment is possible. 
• Proof of performance guidelines for markets provide evidence on the program implementation. 
• New centralized data collection and storage tool for program plans and results. 
• Improved governance and program oversight by central and regional cross-functional teams. 

Other tools include point-of-sale signage, communication templates, and talking points to guide in-person conversations. 

To evaluate the effectiveness of our youth access prevention programs in 2023, we focused on creating a comprehensive company-wide mystery shopping program. This initiative involves legal-age adults attempting to purchase our products and then reporting back on whether age-verification procedures were followed, providing a tangible way to measure compliance with our youth access policies. 

We first gathered best practices from regulated industries worldwide. Then, we developed a detailed plan, collaborated with top industry experts, and devised a methodology to select key markets for testing based on factors like youth smoking prevalence and the market’s rule of law index. This strategy is designed to strengthen our commitment to preventing underage access to our products and ensure consistent adherence to our compliance standards across all markets. 

Age controls 

We continue to develop best-in-class technology to prevent youth access and minimize the unintended use of our smoke-free devices. We have launched a series of pilots, including the testing of different user experiences, a suite of online age-verification mechanisms, and various methods to perform device activation. 

To verify age online, different methods are used by various markets. One method is asking customers to upload a copy of their ID for age validation. Another option is using third-party databases, such as those from government agencies, telephone network operators, or banks, to verify the customer’s personal information and confirm they are an adult. There is also the option for a contact center agent to conduct age verification via a virtual video call. 

In 2023, we continued to advance our commitment to develop, test, and deploy enhanced online age-verification technologies for our e-commerce sites. A notable example is Yoti, a facial analysis age-verification tool certified by the Age Check Certification Scheme in the U.K. This tool has been tested across multiple industries and has proven to be a reliable way to verify an individual’s age. Yoti was piloted in five markets with IQOS and VEEV e-commerce sites during the past year, with plans for further expansion in 2024. 

When the necessary technology for age verification isn’t available or when a person can’t be age-verified using digital methods, alternative processes are used. These include face-to-face age verification by couriers upon delivery or at designated collection pickup points. 
Across all our owned retail channels, we require that consumers are verified as of legal age (or at least 18 years old in markets without a minimum legal age).And at our physical brand retail outlets, anyone who wishes to purchase our smoke-free products is age-verified by a trained salesperson, using official identity documents if necessary. 

On-device access restriction through age-verification technology could serve as an incremental measure to complement existing tools aimed at preventing youth access to electronic smoke-free devices. Since 2020, PMI has invested in research and development to test technologies designed to verify the age of consumers before using electronic smoke-free devices. These technologies have been trialed across a range of products. 

From 2021 to 2023, these technologies and consumer experiences were tested through iterative consumer research labs in France, Japan, and the Philippines. Additionally, live market tests with trade partners and consumers were conducted in France and New Zealand. 

The findings revealed that adult consumers and trade partners acknowledged the importance of restricting access to nicotine-containing products to adults. However, 28 percent of consumers expressed negative feedback, finding the age-verification process intrusive, impractical, and a barrier to purchase and conversion to smoke-free alternatives. 

Product design and labeling 

We apply strict rules governing how we present our products to adult consumers. Our smoke-free consumables’ packaging indicates clearly that the product is for adults, is not risk-free, and contains nicotine, which is addictive.

Flavored e-vapor liquids have been named as a factor in driving youth interest in smoke-free products, particularly those with candy or dessert-like names.

While flavors are essential in encouraging adult smokers to switch to smoke-free products, we recognize that certain flavors should not be used.

We evaluate new flavored heat-not-burn and e-vapor products to ensure they do not particularly appeal to minors.

At PMI, we know that preventing the unintended use of smoke-free products is fundamental to the sustainability and success of our business—as well as the right thing to do. We have a commitment to society, which expects us to act responsibly. Only by focusing on providing better choices to the adults who smoke today can we achieve our goal for tomorrow: A smoke-free future.