By Mike Esterl, Karishma Mehrotra and Valerie Bauerlein 

The U.S. adult smoking rate has plunged to below 20% from more than 40% half a century ago. Increasingly, smokers are poorer and less educated. And many smokers call themselves "occasional" or social smokers, consciously reining themselves in to try to avoid getting hooked.

Still, there are more than 40 million smokers in the U.S. today. And beneath the broad trends are pockets of growth and opportunity that are generating great interest in the tobacco industry.

Smoking rates are higher in gay, lesbian and bisexual groups, which are being targeted by the industry. More Americans are switching to menthol cigarettes like Newport, Lorillard Inc.'s biggest brand. Indeed, Newport is the hot brand that Reynolds American Inc. expects to add to its portfolio with its planned $25 billion acquisition of Lorillard, announced Tuesday.

At a time when Americans crave extreme taste in products that range from candy to beer, it isn't surprising that the only flavored cigarette the FDA allows--menthol--is also the one that is growing fastest. Menthol cigarettes have grown to 31.4% of the cigarette mix, up from 28.7% in 2008, according to Citi Research. The Food and Drug Administration is weighing restrictions on menthol, amid studies suggesting it cools the mouth and throat, making it easier to start smoking and harder to quit.

"It just tastes good," said Jay Oh, a 29-year-old waitress in Kotzebue, Alaska, who smokes Kool menthols and lives in the county where U.S. smoking rates are the highest: 41.5% for men and 40.8% for women, according to a recent study by the Institute for Health Metrics and Evaluation.

Menthol cigarettes are particularly popular with African-Americans, who smoke them 80% of the time. Small-business consultant Bo M. Marshall, 40, bought a pack of Camel Crush Menthol cigarettes at Tobacco & Gifts in Raleigh, N.C., on Tuesday morning. The Crush cigarette, made by Reynolds, tastes like a regular Camel until you crush the logo on the filter, releasing a menthol burst of flavor.

Reynolds also has been cultivating its niche Natural American Spirit brand by pitching it as "organic."

Russell Mick, a 27-year-old environmental sciences major at the University of Arkansas, rolls his own cigarettes with organic Natural American Spirit tobacco. "It's 'healthy,' " said Mr. Mick, making air quotes with his fingers.

Cigarette companies have already stepped up their marketing in the LGBT community. A government survey published last month estimated the smoking rate among lesbian, gay and bisexuals to be 27.7%, compared with 17.3% among heterosexuals. The higher smoking rates could be tied to greater social stress, more frequent visits to bars and higher rates of alcohol use, according to Legacy, an antismoking group.

Smoking rates also vary regionally. Kentucky, a major tobacco producer, had the highest smoking rate in the country last year at 30.2%, followed by West Virginia and Mississippi, according to a Gallup poll. Utah had the lowest rate, at 12.2%, followed by California and Minnesota.

In Vicksburg, Miss., 34-year-old restaurant worker Felicia James says she has been smoking for 20 years and doesn't feel out of place. Her city is near Issaquena County, where the male smoking rate rose 1.1% in annualized terms between 1996 and 2012, the biggest increase in any U.S. county, according to a recent study.

"It's like everybody smokes," said Ms. James, who smokes Newport menthols.

Something else that hasn't changed despite years of state and federal excise tax increases: the lower the income, the higher the smoking rate.

The adult smoking rate among Americans below the poverty line was 27.9% in 2012, compared with 17% for those above the poverty line, according to a government survey.

The smoking rate in households with annual incomes that top $100,000 is 9.3%, according to another recent government survey.

But cigarettes also cost less in smoker-heavy states. The 10 states with the highest smoking rates had an average cigarette tax of 82 cents a pack in 2012, compared with $2.42 in the 10 states with the lowest smoking rates, according to Campaign for Tobacco-Free Kids.

About 70% of American smokers say they want to quit, and about 50% try to quit every year.

"I need to quit," says Mr. Marshall, the North Carolina small-business consultant. "I have quit a number of times."

Many say they are ashamed of the habit. Donna "D" Sharp, who works at a law firm in Atlanta, has been smoking a half a pack of Newports a day for 30 years. "We're definitely pariahs of society at this point," Ms. Sharp, 59, said. She isolates herself at dinner parties and goes outside her office building during the day to smoke. "It's a horrible, ugly habit," she said.

But kicking the habit remains tough. Only about 1 in 20 who try to quit in any given year actually succeed, according to various surveys.

Vivek Dutta, a 65-year-old engineering consultant in Cupertino, Calif., says he began smoking when he was 24 and smokes a pack a of Marlboro Golds each day. But he only the first half of each cigarette, hoping less tar will enter his lungs that way.

When Chuck Rushton started smoking as a teenager, cigarettes were 35 cents a pack.

Now he's spending about $48 a week for a carton of Doral Gold cigarettes at N.C. Tobacco, the strip-mall shop in southwest Raleigh where he is a regular. Mr. Rushton, 63, said he would like to quit but hasn't been able to. "I've tried gum, patches, hypnosis, and cold turkey," he said. "The longest I lasted was four days."

His doctor suggested he switch to electronic cigarettes, but it turns out that for him--and a lot of others--e-cigarettes just aren't the same as smoking.

He thinks an e-cig "looks like a portable hookah," he said. Mr. Marshall, the Camel Crush smoker, doesn't trust them. "You don't know what's in that stuff," he said. "I can't see inhaling a vapor that's not necessarily FDA approved."

Mr. Mick, the college student, says most of his smoker friends switched to e-cigs because they are more convenient. He tried, but "it doesn't appeal to me," said Mr. Mick. "An e-cig is not a cigarette. The tactile experience, the disgusting sensation of smoke entering my lungs. It's not the same."

Peter Evans and Betsy McKay contributed to this article.

Subscribe to WSJ: http://online.wsj.com?mod=djnwires