James Duke was an American tobacco and electric power industrialist and philanthropist. James and his brother Benjamin took over their father's fledgling tobacco company, developing it into a multi-million dollar empire. By the early 1890's they controlled almost half of America's tobacco industry. He is also known today as the patron of Duke University.
Background
James Duke was born on December 23, 1856, in Durham, North Carolina, the United States, to Washington and Artelia Duke. James had two half-brothers, Sidney and Brodie; one sister Mary Elizabeth, and one brother, Benjamin. Artelia died when James was only two years old.
Duke grew up on a small farm with a widowed father. After the Civil War devastated the Carolina countryside, his father's farm was destroyed. The farm had produced corn, oats, wheat, and tobacco crops, but only some stored leaf tobacco escaped destruction.
When Washington Duke returned from service in the Confederate Army, the family had to begin anew with total assets of 50 cents and two blind mules. The discovery of a small load of tobacco that had somehow escaped capture by Union forces triggered their rise to wealth.
Education
Duke received some education in an improvised school near his home, attended an academy in Durham for a while, and was sent briefly to New Garden School (later Guilford College) in 1872. He later attended the Eastman Business College in Poughkeepsie, New York. His primary education, however, was in the family's business - first farming, then the hand manufacture and "drumming" (marketing) of tobacco products, and finally, the mass production and mass marketing of cigarettes.
The Duke family then turned to the tobacco crop and subsistence farming for their survival. Because so much tobacco was destroyed throughout the South during the Civil War, demand for tobacco skyrocketed once the fighting stopped. Sensing the demand for tobacco and its greater market potential, Duke's father sold the family farm in 1874 and set up business in a tobacco factory in downtown Durham. James joined the family business, W. Duke and Sons, after completing business training at a New York school. It was there that the younger Duke began to seek creative ways to promote and improve the family business.
In 1880, at the age of 24, Duke entered what was then a niche within the tobacco business - ready-rolled cigarettes. A small team in Durham, North Carolina, hand-rolled the Duke of Durham cigarettes, twisting the ends to seal them. Two years later Duke saw an opportunity. He began working with a young mechanic called James Bonsack, who said he could mechanize cigarette manufacturing. Duke was convinced that people would want to smoke these neatly-rolled, perfectly symmetrical machine-made cigarettes.
When, in 1881, the Dukes began to manufacture cigarettes, business boomed. Three years later, with James in control, the company moved its executive offices to New Jersey to take advantage of that state's liberal corporation laws and to exploit the virgin markets of the North and West. Thereafter, the business grew into an international combine as Duke pursued monopolistic methods. Rebates, discrimination, a nationwide secret service, bulldozer tactics against competitors, and price manipulations marked the long "Tobacco War," by which Duke gained a complete ascendancy over all rivals.
James Duke developed innovative marketing and production techniques that helped propel his family business to success. One of these innovations was the 1884 acquisition of the Bonsack cigarette-rolling machine, which allowed mechanized mass production of cigarettes. Before the Bonsack machine was introduced cigarettes were hand-rolled and difficult to mass-produce. They were not very popular. Once Duke set mass production in motion, he directed his efforts to capture public attention. In 1884 he moved to New York City and opened a company office. He studied the operations of retail stores in the city and planned his strategy based on his findings.
As a promotional effort, Duke offered free samples of his cigarettes to new immigrants, hoping they would come back for more as paying customers. He advertised on billboards and posters, as well as in newspapers and magazines. He used the Duke family name to support sporting events and included coupons inside packets of Duke cigarettes.
Duke's aggressive marketing techniques were unprecedented in his day and they paid off. By 1889 the business, now called W. Duke, Sons and Company, produced 45 percent of all cigarettes sold in the United States. Duke's attempts to win an ever-greater share of the growing tobacco market culminated in an 1889 merger with four other major tobacco manufacturers.
When the principal American cigarette-manufacturing companies merged to form the American Tobacco Company in 1890, James became its president. He later helped to organize the American Snuff Company (1900) and the American Cigar Company (1901). By 1904 Duke's American Tobacco Company controlled 90 percent of the national market and at least 50 percent of the foreign trade in tobacco. With unlimited power and capitalization of over $500,000,000, the Duke trust was so powerful that a 1911 Supreme Court decree ordering their monopoly be dissolved had little effect on the company's prosperity.
Duke also developed an interest in the potential of electrical power. In 1905 he organized the Southern (now Duke) Power and Light Company. Within 25 years this utility was "capable of producing more energy than all the slaves of the Old South." He invested heavily in hydroelectric power plants, founding the Southern Power System in 1905. Southern Power built eleven plants (1907-1925). At the same time, Duke invested in textile mills producing cotton and wool. The mills ran on power supplied by Duke's hydroelectric plants. The Southern Power System eventually became known as the Duke Power Company. Within two decades, this company was supplying electricity to more than 300 cotton mills and various other factories, electric lines, and cities and towns primarily in the Piedmont region of North and South Carolina.
James Buchanan Duke built two massive fortunes, the first in tobacco and the second in hydroelectric generation. With his wealth, he became one of the greatest philanthropists in the history of the Carolinas, perhaps best known today as the patron of Duke University. James Duke is memorialized in a statue in front of Duke University’s monumental chapel.
Religion
James Duke was a lifelong Methodist. He designated annual income to be distributed to rural Methodist churches and retired Methodist preachers in North Carolina.
Politics
James Duke was a Republican.
Views
Duke shared his good business fortune with the public through his generous philanthropy. Known for his philanthropic spirit, James Duke established the Duke Endowment as a trust fund to help non-profit hospitals, child care institutions, small rural Methodist church congregations, and universities. One of the prime beneficiaries of the Duke Endowment was a small school, Trinity College which, in 1892, relocated to Buck's hometown of Durham, North Carolina. Because of his generous gift, the new university that evolved from this small college was named Duke University. The new school was named in honor of his father Washington Duke, who had encouraged his sons to be generous in sharing their wealth.
In 1924 he established the Duke Endowment with $40 million. The Duke Endowment was also established to support other educational institutions, health care organizations, children's homes, and churches.
Personality
Duke was hardworking, generous, and believed in sustaining relationships. He was a well-mannered and respected person throughout his life. For unlike numerous establishments of Duke's period, which spent the previous century discovering courses out of their authors' outlines, Duke's trustees have tried to remain as near to his motivations as could be allowed.
Physical Characteristics:
Duke was a tall, rugged, redheaded man.
Connections
Duke was married twice. He first married a divorcee, Lillian McCredy, in September 1904. After a brief marriage that ended in divorce, James Duke married a widow from Atlanta, Nanaline Holt Inman, in 1907. Their daughter Doris was born in 1912.
Father:
Washington Duke
With the assistance of his two sons, Benjamin Newton and James Buchanan, and his daughter, Mary Elizabeth, Washington Duke's early manufacturing business consisted of beating cured tobacco by hand with sticks, sifting it through a fine wire sieve, and packing it in small bags for sale.
Mother:
Artelia Duke
In the late summer of 1858, Artelia died from typhoid fever. The death of their mother would later encourage the Duke children to help financially support a local orphanage.
Spouse:
Nanaline Holt Inman
Nanaline Holt Inman Duke's first marriage was to an Atlanta cotton merchant, but it was her marriage to tobacco baron James Duke that vaulted her into the country’s wealthiest elite.
Often sickly as a child, Benjamin developed an especially close relationship with his more robust younger brother, James Duke.
Sister:
Mary Elizabeth Duke
Mary Elizabeth Duke was the first child and only daughter of Washington Duke and his second wife, Artelia. Mary, along with her father and brothers, worked in the family tobacco business after the Civil War.
Half-brother:
Brodie Leonidas Duke
Brodie was the first of the family to leave the farm and move into Durham, in 1869, where he began his own business manufacturing smoking tobacco.
Brodie made, lost, and made again several fortunes in tobacco, textile manufacturing, commodity investments, and land development. He developed an arc of property west and north of 19th-century Durham, including the present-day Duke Park Old North Durham and Trinity Park neighborhoods.
Half-brother:
Sidney Taylor Duke
Sidney died ten days before Artelia, also from typhoid fever.
former spouse:
Lillian McCredy
Daughter:
Doris Duke
Adventurous, intelligent, and independent, Doris Duke used her wealth to pursue her many interests, which included travel, the arts, historic preservation, environmental conservation, preservation of wildlife, and ornamental horticulture.
After the large contribution by James Duke, President William P. Few convinced James Duke to allow Trinity University to be renamed. James Duke agreed under the condition that it would be done in memorial to his father, Washington.
