If people can't use credit cards to purchase cigarettes online, then a lot fewer cigarettes will be sold this way. That's the finding of a new study by researchers at the University of North Carolina.
The study, published in the journal PLoS One, found that banning credit card payments and the use of commercial shippers to deliver to deliver the smokes lowered the number of vendors offering cigarettes online and reduced consumer traffic to the most popular cigarette-selling websites.
"Most Internet vendors offer tax-free cigarettes, making them cheaper than those sold at stores," said Kurt Ribisl, Ph.D., lead author of the study and associate professor of health behavior and health education in the UNC Gillings School of Global Public Health. "This undermines the impact that higher prices have on reducing smoking."
Selling to minors
Ribisl said that aside from violating tax laws, most online cigarette vendors have weak age verification and sell to minors. This led to landmark voluntary agreements in 2005 with major credit card companies and private shippers to ban payment transactions and bar commercial shippers from transporting all Internet cigarette sales.
The study is believed to be the first such research examining the impact of those agreements.
Ribisl and a team of UNC researchers studied the bans' effectiveness by examining the sales practices of hundreds of websites one year before and two years after the agreements went into effect. They also compared the number of unique monthly visitors to the 50 most popular cigarette vendor sites to determine whether the bans altered web traffic.
Death knell for websites
The study found that following the bans, many websites closed down. There also was a 3.5-fold decline in traffic to the 50 most popular vendor sites, resulting in an estimated 1.25 million fewer visits per month before the end of the 2005. And although an influx of new vendors initially saw a net increase in the number of sites, their numbers fell markedly over the following year, resulting in an overall drop in the total number of vendors.
Researchers also found that the proportion of vendors accepting credit cards and PayPal dropped from 99.2 percent to 37.4 percent after the bans, and the proportion offering to ship via UPS, FedEx and other commercial shippers dropped from 32.2 percent to 5.6 percent.
However, there was a corresponding increase in vendors offering non-banned payment options, such as personal checks, and shipping options, including the U.S. Postal Service, which did not ban cigarettes.
This indicated that the Internet vendors actively exploited loopholes in the voluntary agreements, the study noted, although a new federal law signed by President Obama last year has strengthened the provisions of the voluntary agreements and made tobacco nonmailable matter through the U.S. Postal Service.