On April 2, 1993, Philip Morris’s stock price fell by 26%, the largest drop of any company—until Facebook plummeted in July 2018.

In the early 1990s, cigarettes could still be found in the mouths of restaurants, vending machines, and various consumers. For adults and teenagers, one brand eclipses all other brands: Marlboro. The red and white filter cigarettes have been enthusiastically sought after, thanks in part to the iconic cowboy character Marlboro, who brought masculinity to the brand. For decades, he led the seemingly unstoppable tobacco giant to gain dozens of Billion dollars in profits.

So how did Marlboro become the receiving end of the worst stock market crash at the time?

This is what happened on "Marlboro Friday". On April 2, 1993, the share price of its parent company Phillip Morris fell by 26%, the largest decline of any company so far. The decline seems to be everywhere. It threatened to destroy the entire U.S. stock market—and not only shook American confidence in one of its most famous brands, but also shook confidence in the brand concept itself.

Marlboro has long been the most popular cigarette in the world. These cigarettes were first sold in 1923 and were initially sold to women under the slogan "Mild as May". But after World War II, with cigarette brands such as Lucky Strike and Camel taking the lead, the brand underwent a masculine transformation. The brand was relaunched in 1955 for lifelong male smokers. The new red and white packaging and the masculine cowboy known only as the Marlboro cigarettes caused a sensation.

By 1993, they had been the best-selling cigarettes in the world for decades. Therefore, investors were shocked when the brand announced that it would significantly reduce the price of a pack by 40 cents. Why did the world’s best-selling cigarettes cut their prices so boldly?

The Philip Morris advertisement used the famous Marlboro cowboy character on a billboard in downtown Atlanta. (Photo credit: In Pictures Ltd./Corbis via Getty Images)

The reason is competition, the brand explained: discount brands and smokers who consume less cigarettes must preemptively. But for analysts, the strike is more like a bomb, especially when they learn that Marlboro will invest more in advertising.

"It's not unlike a candidate who tries to win an election by attacking his or her opponent in a fiery speech in the morning and then pays for warm-and-fuzzy, mom-and-apple-pie commercials to appear that evening," wroteThe Stewart Elliott of the New York Times. Market experts worry that no matter how strong its denim image and iconic brand are, price cuts will undermine the long-term viability of the brand.

The shareholders apparently agreed: When their company announced that the price of a package would be reduced by 40 cents, investors fled. The stock price fell 23%, the biggest one-day drop of any brand in history at the time. The news that Philip Morris’s share price has fallen has also dealt a heavy blow to other stocks. Suddenly, investors began to sell stocks related to other well-known brands such as Campbell Soup, Nabisco, Wal-Mart and Coca-Cola. The Dow Jones Industrial Average fell 69.17 points.

The riot-soon called "Marlboro Friday"-was not just frightening from the perspective of the stock market. The shocking decline of one of America's most popular brands raises a terrible question: What if the brand concept itself is false?

"The 1980s ended on that day," consumer marketing researcher Watts Wackert said in the New York Times a year later. Suddenly, in the fifteen years under the rule of famous brands, the loyalty of such an important brand was faltering. Frightened by the prolonged economic recession, American consumers have begun to shop in new large stores such as Wal-Mart, buying more general-purpose products, and being more cautious when opening their wallets.

But stingy consumers are just the tip of the iceberg for Philip Morris. Like the Titanic in slow motion, the company is about to fall into a public relations disaster and social change. Since the 1950s, individuals have been suing individual tobacco companies, accusing them of adverse health effects, such as cancer caused by smoking. In May 1994, a little more than a year after Marlboro Friday, Mississippi became the first state to sue a tobacco company.

It opened the floodgates: As more and more states seek compensation for the harm caused by smoking, the depth of the tobacco industry's involvement in decades of lies has been revealed. It turns out that companies like Phillip Morrisknew knew about the adverse effects of smoking and the addictive potential of nicotine as early as the 1950s, but they have been engaged in deceptive marketing for decades anyway.

In the 1990s, as the health effects of smoking were better publicized and the degree of collusion among tobacco companies became more widely known, the golden age of smoking in the United States came to an end. (The news that at least four actors who played Marlboro people died of smoking-related diseases also did not help the brand.)

So does Marlboro Friday really mean the demise of other American brands? not completely. "The company realized that they no longer simply put their logo on a billboard and then ended work," wrote Morgan Housel of The Motley Fool. "That's just advertising. Successful branding means that companies must integrate their products into consumers' lives-the brand needs to be an experience, a way of life, not just the appearance of the product."

As the 1990s passed, brands such as Gap, Apple, and Starbucks successfully penetrated consumers' daily lives. Despite the short-lived phenomenon, Marlboro-whose parent company Phillip Morris (Phillip Morris), faced rising political pressure from tobacco companies in the early 2000s, renamed itself Altria Group-is still considered a historical The most successful stock.

Marlboro Friday may be the worst day a brand has experienced at the time, but Marlboro people dismissed it and did a good job.

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