Pakistan Tobacco Company Limited (PTC): Brand Management Report

ptc pakistan reportPakistan Tobacco Company Limited (PTC): Brand Management Report

Background Information

Company Introduction

Pakistan Tobacco Company Limited (PTC) is one of Pakistan’s most established and structured multinational organization. PTC was established in 1950. It is a subsidiary of British American Tobacco, which has a 63.4% stake in the company. PTC is one of the largest cigarette manufacturing company in Pakistan and has a market share of around 42%. Pakistan Tobacco has initiated a Change Management Program. This program is known as BEST 2000. PTC believes that Total Quality is more than just Product Quality; it is quality of everything they do in business. It means understanding your Consumers, Customers, Stakeholders, and Suppliers. BEST 2000 is serving as the fundamental building block in directing the energies of PTC to achieve its mission statement. The following is the mission statement of PTC: Together we will be the best in everything we do. BEST 2000 was launched in 1997. BEST is helping PTC improve its team building. Further, it provides the means to continuously improve and break the vicious cycles that inhibit improvement activities. Moreover, it assists employees to participate in driving the company forward. The end objective of PTC is to ensure that its team is fully aligned to meet future challenges and well prepared to drive into the next millennium. Pakistan Tobacco has a paid up capital of Rs. 319.367 million. In 1998 the company contributed around Rs. 9.4 billion to the national economy in the form of duties & taxes. The prestigious brands of PTC include Benson & Hedges, John Player Gold Leaf, Capstan, Wills Kings, Wills Gold Flake, Embassy, and Three Castles. Pakistan Tobacco Company diversified its operation by entering into the edible oil market in 1996. Moreover, the company plans to explore the export potential by capitalizing on the opportunities present in the Central Asian countries.

British-American Company (BAT) is the world’s most international cigarette company, with an unparalleled presence in the global tobacco market. British-American Tobacco is a clear leader in a competitive and fast-moving business. BAT is beyond doubt a multinational, multicultural, multidisciplined, and world-class tobacco company. The famous brands of BAT account for over one in eight of all cigarettes sold in the world. BAT is expanding rapidly through both generic growth and acquisition. The company owns the top-selling brand in over 30 of the world’s markets, and its brands appear among the five best-selling cigarettes in 65 markets. Global sales of the company’s brands are growing at seven percent per annum. Financial strength, high-caliber people, effective teamwork, a clear market focus and an innovative and progressive business strategy are integral parts of the dynamic corporate culture of BAT. British-American Tobacco offers a brand for every taste and preference. The international brands segment is the fastest growing in the world tobacco market. BAT’s competitive portfolio of international brands includes some of the industry’s best-known names: Lucky Strike, Kent, Pall Mall, Hollywood, Viceroy, State Express 555, John Player Gold Leaf, Benson & Hedges, Silk Cut, and so on. The global spirit of BAT is reflected not only in the geographical spread of its operations, but also in its people. High-caliber individuals who think and act as global business managers are key to the company’s sustained success.

 

CHAPTER 2

PTC’s Marketing Plan for Gold Leaf

 

 

The marketing plan that is developed for the JPGL brand is heavily promotion oriented. This includes planning and implementing such activities as schemes, merchandising, trade offers and discounts, advertising etc. Since this is their key area of operations, we decided to begin our analysis of PTC’s marketing plan for Gold Leaf   by studying its promotion campaigns.

 

Analysis of VOD (Voyage of Discovery)

Advertisement Along the 7 “M” Framework:

 

  • Merchandizing: refers to what is to be promoted. The advertising is exclusively promoting a premium quality cigarette with a special Virginian tobacco blend. It has a quality filter designed to maximize puff smoothness for the smoker.
  • Markets: this answers the question, “ to whom are we advertising?” The advertisement is targeting a young, sporty and energetic market with an adventurous outlook towards life. These are people who aspire to achieve, to experience, and to explore all that their environment has to offer and more. They are usually urbanites belonging to the middle, upper middle, and upper income segments. They associate with and are motivated by team efforts.
  • Motives: why do these consumers buy? A motive is a strong and persistent internal stimulus around which behavior is organized. Consumer research has revealed that status, the desire to excel in group activities, the will to achieve and to conquer and overcome odds are the primary motivating forces behind this target markets’ purchase/choice for the brand. So purchase precipitation can be brought about through appeals towards these inner motives and desires. These consumers also display a substantial need for belonging and recognition. The target consumers are thus driven by the following meta-motives:
  1. Need for achievement.
  2. Need for belonging and recognition.
  3. Need for self esteem.
  • Message: what appeals will work best? The advertisement appeals to the innate sense of conquer and control within the consumer. It portrays a turbulent and challenging environment ( the wide open sea ) and a group of dedicated individuals trying to elements. It brings forth to the consumer the concept of achievement, glory and recognition. The message directly appeals to the consumers’ perception of status and a daring and adventurous lifestyle. Thus the message content expressly caters to the ideal-self of the consumer: what he would ideally like to be.
  • Money: how much should be spent and when? Although exact details of the advertising budget for this scheme were not disclosed, the Area Manager South estimated an amount of rupees 40 million for the Pan-Pakistan advertising campaign.
  • Media: this refers to the type and frequency of media vehicle to be used. The major media employed for this campaign include the following:
  1. Television: during airing of prime time shows, sporting events,                         and galas.
  2. Radio: during sporting events and as sponsors of drama specials, music programs, and after news bulletins.
  3. Print : Major newspapers and glossy magazines.
  4. Cinema: Major cinema houses/theatres.
  • Measurement: how do consumers respond to our advertisements? The promotion generated an overall response rate of 21% which is a record for the region( as reported in the company’s annual report ). About 1.3 million responses were received for the lucky draw.

A Taste Apart:

PTC has a tradition of a increasing the sales of their brands through different advertisingb campaigns and this theme is based on the objectives of brand awareness. they prepare some posters and other point of sale material on the same theme and put these posters on the different outlets in the country.They put these posters on these outlets for a very short time of 15 days and they change it afterwards. They believe that a when a customer visits anoutlet he normally looks around the posters and he get used to it as in this market customer normally buys from the same outlets and they visualize this poster in his mind. When these posters are changed after a certain period it reminds them of the previous poster and also creates an interest in the consumers mind. This interest keeps them talking about the change and hence brand awareness is created.

TITANIC:

This advertisingv campaign was based on the concept of voyage of discory. As the main element in the campaign was a ship and a dedicated and an adventurous teamof daring people so was the case in this movie. This campaign was very well supported by the fact that this movie was moveing around the ship and the people who were dedicated and adventurous and had a sense of sacrifice.It was a good match between the product positioning and the target market as most of the people coming for movie consisted of the tarhget market of Gold Leaf.

For this theme company took several steps to make this themne a success.

  • Sponsored the movie and different stalls were put up in the cinema.
  • Packaging of the packet was changed according to the concept and the idea areoun which the campaign was launched.

 

John Player Gold Leaf Advertising Strategy

Advertising Objectives:

To increase advertising awareness to 30% by end of year 2000. To increase brand awareness among the target audience and to build trial levels of the brand. To do all of the above with the objective of keeping the message in the forefront of the consumer’s mind.

Target Audience:

The core target market is men and women in urban and semi-urban areas in households with average income of Rs.8000 plus. This means that middle, upper middle and upper income segments are being targeted through the advertising. The middle income persons aspire to be what the advertising portrays while people in the upper income strata of society can associate with the premium image of the advertising. Both first time smokers and smokers of other brands are targeted. Induction of trial and conversion is sought from the advertising. The advertising is also targeted at loyal JPGL smokers as it continues to uphold the values of unmatched status and premium high quality.

Media Selection:

We have chosen television as the primary medium. With its high reach, moving picture advantages, high penetration, and lower relative cost it remains the dominant medium of communication. Choice of channels has been restricted to PTV and PTV WORLD. Secondary media would be print wherein major newspapers(especially weekend sections) and thematic magazines will be advertised in. Radio especially music channels like FM would be advertised on Cinema would be made use of sparingly.

Performance and Geographic Spending:

The objective is to maintain advertising presence throughout the year, except for the month of Ramazan and the Muharram period. Advertising will be on national level.

 

 

demograhics

 

Population                                                 134 million (growth of 3% p.a.) ? Punjab          56% ?     Sindh            23% ?                                                                 NWFP          16% ?                     Balochistan    5%

Households                                               19.7 million (avg size 6.8 persons)

Literacy                                                     37%

language                                                    Urdu

 

 

Demographics (Continued)

 

                                       males                           females                        total

population by age (%of total)                                                                                                   

?                                     70 +                              0.53                              1.05                              1.58

?                             60-69                            1.92                              1.90                              3.82

?                                     50-59                            3.17                              3.05                              6.22

?                                     40-49                            4.73                              4.56                              9.29

?                                     30-39                            6.17                              6.00                              12.17

?                                     20-29                            7.93                              7.83                              15.76

?                                     10-19                            10.58                            10.64                            21.22

?                                     01-09                            14.93                            15.01                            29.94

49.96                            50.04                            100.00

 

 

 

We believe that the brand John Players Gold Leaf does not belong to the company. It exists in the heads of the clients and prospects. The brand is created through multiple, parallel contacts with customers and prospects. In the consumer world, these branding activities include advertising, public relations, distribution and channel management, product and technical support, direct sales contact and so on.

 

Some people equate their brand with their logo. The two are not the same. A logo is a graphic/ insignia, to be used in all forms of communication with clients and prospects. JPGL’s logo/insignia is the portrayal of “the sailor”. This logo is now a permanent feature of all promotion vehicles.  The company, in our opinion, has over indulged in logo management. However branding is far more then logo management. Branding is every thing you do to touch your customers and prospects.  Real success comes about only when strong brand management principles, systems and tactics are in place. Tactical brand management includes packaging, aggressive promotion, legal protection and documentation. Strategic brand marketing efforts may include decisions to sub-brand, license or retire the brand. If you do not manage your brand, you get the accidental brand which consists of the unmanaged experiences of your customers and prospects coupled with the manipulation of your brand in the minds of the the customers and the prospects by your competitors.  Market research is the ideal adjunct to brand management. It simply makes sense to establish what your brand is before you try to change it into something else. PTC have been successful on this count in the past as according to the area manager extensive research was conducted and the whole scheme was market tested before the launch of the Voyage Of Discovery and the repositioning of JPGL..

 

AVAILABLE MEDIA

 

TELEVISION

  • PTV Commercial Owned             5 Stations
  • PTV WORLD Commercial Owned             42 Countries
  • SPTV Commercial Private                        3 Stations
  • Cable Commercial Private                        12 Channels

 

NEWSPAPERS                   

MAGAZINES                      

CINEMA HOUSES

RADIO                   

  • Radio Pakistan Commercial Owned             18 Stations
  • FM-100 Commercial Private                        3 Stations

 

 

 

 

 

 

PART II

 

 

 

 

“DEVELOPMENT OF

 THE MARKETING PLAN”

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Chapter 3

Environmental Analysis

 

The strategic internal / external audit conducted by PTC headquarters is an on going process that continues throughout the year. This enables regular feedback of sales performance, acheivement of sales goals and targets, implementation and performance of special promotional schemes and specific trends in consumer markets. Furthermore, an end of the year SOP (Sales, Operations and Planning) activity is undertaken by the headquarters in which performance statistics are gathered from  the bottom up i.e. internal / external audit information is gathered primarily from ares and compiled into regional and then zonal reports.

 

This presents the auditing authorities with detailed information regarding the year’s performance characteristics and provids a basis for setting new objectives, targets and standards for the conmpany. Needless to say, however, these objectives are announced in light of certain constraints that have been identified in the auditing process. These constraints can act as the Critical Success Factors (CSF’s) for the company and, thus, require careful consideration.

 

Upon detailed analysis and extensive interviews with relevant PTC managers, we identified the following critical success factors for the company as part of our external / internal audit:

  1. Government restrictions on merchandising.
  2. Uncertain law and order situation.
  3. Profusion of counterfeit packets in the market.
  4. Smuggled packets.
  5. Entry of new “Premier Classic” cigarette in the market.
  6. Political instability.

 

Among the above mentioned CSF’s the threat from counterfeit and smuggled packets is the most ominous since it can seriously errode the brand’s sales potential. Retailers are naturally more willing to buy the counterfeit types since it allows them to earn huge margins form the sale of these cheaply bought packets. Furhermore, there are several restrictions that have been placed on the merchandising activities of brands.These include restrictions on merchandising any kind of material for schools / universities, hospitals and mosques.Hence, anything related to the brand, if caught anywhere near the above mentioned places, is immediately confiscated . This obviously translates into more careful (and subsequently more costly) merchandising activities for the brand.

 

The new competitor by the name of Premier Classic is being marketed by Lakson Tobacco Company which is the licensee of the brand. This cigarette has been placed right into the premium category and, thus, poses a threat for the Gold Leaf as well as the Benson & Hedges brand. PTC must design an effective marketing campaign in order to counter the threat posed by this ambitious new comer.

 

Finally, certain industry trends (not mentioned in the above given list of CSF’s) should also be taken into consideration. The industry for cigarette manufacturers has seen a gradual shrinkage over the past couple of years. Furthermore, it is characterised as being absolutely saturated with different brands in the market. This means that an increasing number of competitors is running after a continuously decreasing pie. Current marketing strategy should, among other things, pursue the option of either market penetration (so as to increase its share of the pie), or rapid market development (so as to increase the size of the pie itself).

 

Market Research:

An extensive marketing research was conducted for the JPGL brand which entailed the preparation and distribution of questionnaires to a sample of 30 respondents. These questionnaires were designed to guage the importance given by consumers to different attributes that are generally found in cigarettes. Specifically, the research was conducted to evaluate JPGL’s standing among oher competing brands as to the extent to which it delivered the most desirable attributes sought in any cigarette brand.

 

For our purposes, we developed and made use of the Multi-attribute Attitude Model. This model allows us to see what exactly is important to the consumer, how well our brand does in providing the attributes that are important, and how we stack up against our competitors.

 

Survey Questionnaire Findings:

A sample of 30 respondent smokers was chosen for our survey. This sample mostly closely represented the actual target market for the brand. The population consisted mainly of university students, faculty members and administration personnel who smoked one or the other type of cigarette brand. The respondents were asked to give weightages (in order of importance) to the following attributes from 1 – 6 ( 1 being the least important and 6 being the most).

  • Image
  • Price
  • Taste
  • Packaging
  • Smoothness
  • Availability

 

From our findings, average numerical values were obtained for each attribute. These were:

 

  • Image                         6          (most important attribute)
  • Taste                         5
  • Price                         4
  • Packaging                         3
  • Availabilty                         2
  • Smoothness             1          (least important attribute)

Next, our respondents were asked to rate the following brands as to how well each brand does in providing the respective attributes. The complete multiattribute model is given below. It is replete with average numerical figures obtained from all 30 questionnaires.

 

The Multi-attribute Attidue Model:

 

                                                         Ratings

Attributes                Weights         JPGL         Morven Gold         Dunhill       R & W

Image                        6                     3                  2                              4                  1

Price                          4                     2                  3                              1                  4

Taste                         5                     3                  2                              4                  1

Packaging                 3                     3                  2                              4                  1

Smoothness              1                     4                  1                              3                  2

Availabilty                2                     4                  1                              2                  3

Attitude Score:                               62                43                            67                38

 

Key Findings:

The multiattribute model shows that consumers generally harbour their most favourable attitudes towards the Dunhill brand (since it has the highest attitude score) and least favourable attitudes are associated with the Red & White brand (since it has the lowest attitude score). Furthermore, it shows that:

  1. The perceived status attached with a brand is highest for Dunhill.
  2. The JPGL brand scores highest as far as smoothness and availabilty are concerned.
  3. The Red & White brand is considered to be the least costly of all.
  4. Consumers are increasingly sensitive towards price and taste attributes.

 

 

 

 

 

Chapter 4

Developing Brand and Pricing Strategies:

 

The process of development of a comprehensive and brand strategy for Gold Leaf entails a thorough analysis of not only the environmental conditions that are prevalent in the market, but also problems and constraints that are specific to the brand itself. Since a detailed exposition of external critical success factors has already been given in the previous chapter, we would concentrate on the relevant internal considerations regarding the brand. These are given below in point form:

 

  1. Product Characteristics:
  • Cigarettes are essentially non durable, convenience goods that consumers purchase frequently, immediately and with a minimum of effort.
  • Cigarettes are staples in that they are purchased on a regular basis by consumers.
  • Cigarettes are perishable goods since they have a limited shelf life.
  • There are several social (and political) stigmas attached to this product. Hence its marketing must be undertaken all the more carefully.
  • The product is presently marketed in a completely saturated industry which is actually declining in size.

 

  1. Brand Characteristics:
  • Gold Leaf is currently in the maturity stage of the brand life cycle. It may be further classified as being in the stable maturity phase in which sales are flattening on a per capita basis.
  • The brand has only one line extension (Gold Leaf Lights). Its latest line extension, that of the 10-stick pack, is in its test marketing stage.
  • JPGL is a brand with high equity, extremely high recognition and recall value and acceptability.
  • The brand is several decades old, and thus, has a loyal consumer following.
  • The brand is periodically supported by sales promotion activities (eg: schemes, discounts and prizes) alongwith powerful advertising campaigns.

 

  1. Organizational Characteristics:
  • The company has a strong distribution partner, DSL (Distribution Services Limited), which has an extensive distribution network in Karachi.
  • Excellent relations with local retailers and wholesalers is considered to be a vital strength for the company.
  • The company has been running into losses consecutively for the past two years.
  • It has a strong and capable pool of human resources which is the consequence of recent restructuring and re-engineering efforts by the company.
  • The company is a major corporate sponsor for many social events and, thus, has considerable clout in the national economy in general and in the tobacco industry in particular.

 

 

 

Marketing Objectives:

 

The marketing objectives develpoed for the plan itself are given below. They have been formulated after taking into consideration findings of the environmental audit:

  1. Increase market share of Gold Leaf by 20 % for this year.
  2. Increase brand awareness levels by 20% by end of year 2000.
  3. Install 1500 new facias of JPGL in choice retail outlets by end of year 2000.
  4. Improve the distribution of the brand by increasing the number of retail outlets selling the brand by 15%.
  5. Increase production of JPGL by 20% by end of March 2000.

 

 

 

Developing

 Alternative Brand Strategies

 

After conducting a thorough SWOT analysis by accounting for the external opportunities / threats and the internal strengths / weaknesses, we embarked on a systematic strategy formulation process in which viable alternative strategies for the brand were proposed. These are given with explanations below:

 

  1. Market Modification Strategy:

Being, as it is, in the maturity stage of the rand life cycle, the company might try to expand the market for its mature brand by working with two factors that make up its sales volume:

Volume = Number of brand users   x   usage rate per user

 

This strategy seems attractive considering the fact that the market is already saturated with multifarious brands of cigarettes. Market development would, therefore, appear to be thelogical strategy to undertake. Since the equation is based on two parts, that is, the number of users part and the usage rate part, we decided to concentrate our efforts on the former dimension. This was decided, in part, because increasing usage frequency is not exactly in line with the identity of the brand. With regards to increasing the number of brand users, this can be achieved by the following methods:

  • Converting non users
  • Entering new market segments
  • Winning over competitors’ customers

 

The marketing activities that this particular strategy would entail, include heavy promotions, concentrated and effective merchandising alongwith a powerful advertising campaign conducted through the use of all available media.

 

 

  1. Product Modification Strategy:

Managers can try to stimulate sales by modifying the product’s characteristics. This can be in the form of either adding product features, improving style / image and quality enhancement, or it may take the form of brand manipulation. As students of brand management, we have identified the following areas through which brand manipulation could be brought about:

  1. a) Through line extensions
  2. b) Through brand extensions
  3. c) Through the use of multi brands
  4. d) Through the introduction of new brands
  5. e) Through brand repositioning

 

From among the above given strategies, we favoured the line extension strategy the most since it would not only serve to act as an effective differentiating factor for the brand, but would also be in line with our earlier strategy of market development. Line extension occurs when a company introduces additional items in the same product category under the same brand name such as new flavours, forms, colours, added ingredients, package sizes tec. The question, however, arises that exactly what sort of line extension are we proposing for the Gold Leaf brand? This may answered by the following:

 

  • Gold Leaf MAX:

The current length of a JPGL cigarette is approximately 5.7 cms (excluding the filter). We propose that a new, longer cigarette be manufactured and test marketed. The length of this new longer fag would approximately be 6.2 cms and it could be called Gold Leaf Max. This particular brand would easily fit in with the new, sporty, jet set positioning of the brand. It would appeal to the target markets’ sense of achieving the maximum in terms of challenges, dreams and heights of glory. This brand can also more easily be targeted to new segments of the market, thereby, keeping in line with the earlier established market development strategy.

 

 

  • Full Scale Production of Gold Leaf TENS:

In our detailed interviews with PTC managers, we discovered that the company had recently test marketed a new 10-stick packet of Gold Leaf in the Karachi market. This was named Gold Leaf Tens and it represented a strategic move by the company. According to the Area Manager Karachi (East), there were several reasons behind the introduction of this brand. Firstly and foremostly, it allowed the moving in of lower category consumers into the medium category. The packet is very easy to hide and manage. Furthermore, it compensated for the loss of volume of 20-stick packets.

 

In our view, and from the intimations of the company itself, this new packet has been a big success in the market and is ready to be produced on a full scale. This would represent another line extension for the Gold Leaf brand and, again, as a tool for achieving its market development goals.

 

 

Product Pricing Strategy:

Prices for the existing brands would remain the same, until the onset of any form of regulation on the part of the government which might effect import duties on tobacco, import restrictions, tariff structure revisions etc.

 

The price of the two new brands however must be strategically set. As far as the Tens packet is concerned, it is currently being priced at Rs. 17.5 which is Rs. 1 lower than Red & White. We suggest that this proce remain the same keeping in mind consumer price sensitivity and competitors’ hostile reactions to price cutting. On the other hand, the pricing of the Max packet must be raised to a level higher than that of the regular Gold Leaf packet. Due to its longer stem, this packet must be priced o a cost + competion basis. A proposed price of Rs. 42 (as compared to the regular pack’s price of Rs.34) would seem appropriate at this stage. This would be a competitive price vis-à-vis that of Dunhill’s price of Rs. 45. The price would include all production and manufacturing costs, alongwith relevant costs of packaging the fags.

 

Chapter 5

Developing Promotion & Distribution Strategies

 

PTC’s strength lies in its extensive distribution network and effective promotion activities. It is essentially a sales driven company and, as such, is heavily oriented towards the use of sales promotion tools, merchandising and trade marketing. It employs a concentrated mix of sales promotion elements such as discounts, coupons, special schemes, prizes and trade discounts etc. to support its many brands.  All these activities are treated as marketing expenses by the company.

 

For the purpose of promoting our new Tens and Max brands, we suggest the use of the following sales promotion activities:

 

  1. Extensive use of print media e.g. posters, stickers, POS material, banners, placcards etc. at all selected stores.
  2. Deployment of facias made of panaflex or scotch-tape material at all exclusive retail outlets in Clifton, Defense, Saddar, North Nazimabad, PECHS and KDA.
  3. Setting up of kiosks at strategic locations throughout the city inviting customers for free trial of the brands.
  4. Giving away merchandise to consumers in the beginning days of the launch. This might include such things as key chains, lighters, pens, watches and ash trays etc. all with the brand logo imprinted prominently on them so as to foster brand recall.
  5. Development of National MAX Campaign:

A nation wide campaign would be launched after the initial launch of the two brands. This campaign would commence after six months of the initial launch and would be the premier event of the year for Gold Leaf Max. The campaign would feature a full time sponsorship for a prime time entertainment show on television. The show would be used as the launching pad for the Max brand and would be along the lines of the currently running B & H Movies entertainment program. It would be a sports show featuring the latest and hottest news in international sport. This progam would culminate in a special Gold Leaf scheme in which consumers would have the chance of winning outstanding prizes. The scheme would be in the form of a simple question & answer test in which questions related to current affairs in the sporting world (which had recently been highlighted in the program itself) would be asked. These would be followed up with multiple choices with one answer as the correct one. Prizes for this scheme would include the following:

  • Special cigarette retainer cases
  • Sports kits and accessories
  • TVs, VCRs and Transistors
  • Smaller merchandise such as Max lighters, keychains, pens and posters etc.

 

Distribution:

The company employs the intensive distribution strategy for all its brands, save B & H. Distribution standards for the regular JPGL brand would not change and new sales targets for this brand would be made in accordance with consumer demand and the company’s efforts to push this brand through.

 

For the two new extensions to this brand, however, a careful distributio strategy is chalked out. This is given in the form of three phases in the passage below:

 

Phase 1: In this initial phase, the brands would be distributed only to select stores throughout Karachi. These stores would have been chalked out and earmarked for the instalment of facias and hoarding boards advertising the brands. Retail outlets with high turnover, good location and a high consumer patronage in places like Defense, PECHS, Clifton, North Nazimabad, KDA and Malir would be targeted.

 

Phase 2: in this phase the distribution of the two new brands would expand to middle and upper middle income areas of the city. This would be done as the demand for the brands rises with the passage of time. Retail outlets in Federal B. Area, Saddar, Gulshan etc. would be targeted. The brands would be moving into the intensive distribution phase here.

Phase 3:  In the final phase, as demand for the brands becomes more prominent and recognized across areas, the intensive distribution strategy would be undertaken in full swing with distribution of the brands to all general and kiryana stores, khokhas and even paan waalas.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Chapter 6

The Sales Promotion Budget

 

 

  1. ADVERTISING

 

Television:                 Rs. 31,000,000

Print:                              12,500,000

                                         Radio:                           2,500,000

                                             Cinema:                                   800,000

TOTAL:                    Rs. 46,800,000

 

 

  1. MERCHANDISING

 

SALES PROM.

And TRADE PROM.:     Rs. 15,000,000

 

SPONSORSHIPS:                      11,000,000

TOTAL                      RS.        72,800,000

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JPGL- PROMOTION PLAN FOR FM-100

 

Time             Thu     Fri     Sat       Sun     Mon      Tue       Wed      Spots/ Week          

08:00 am      1          1         1                      1                          1            5

01:00 pm      1                     1          1          1            1            1            6

05:00pm       1          1                     1                        1            1            5

05:30 pm                                                     1                                        1

07:00 pm                             1                                                                1

08:00pm                   1                     1                        1                          3

10:00 pm      1          1         1                      1                          1            5

 

 

 

spots/week                                26

weeks on air                               4                   

total spots                          104

rate                                     Rs.1000

total cost                     Rs.104000

p.tax                                        2324

ced                                          16600

grand total cost  Rs.122924                

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PART III

 

“VINDICATION & CONCLUSIONS”

 

 

 

 

 

 

 

 

 

 

 

 

 

Chapter 7

Brand Strategy and the

Multiattribute Attitude Model

 

The brand strategy developed for the Gold Leaf brand must be consonant with the findings of the multiattribute attitude model developed earlier. Since the model gave insights into the type of attributes that consumers generally value in a brand, it would be judicious to see whether current brand strategy is instrumental in providing those choice attributes to the consumers or not. Furthermore, the model also indicated which brands, in consumers’ minds, were the best in delivering those attributes. It is our job to make sure that the JPGL brand maintains its strength in providing these attributes.

 

The following is an analysis of our brand strategy’s degree of coherence with the key findings obtained earlier from the model:

  1. Since the model indicated that the perceived status attached with a brand is highest for Dunhill, current brand strategy has attempted to tackle this problem by creating two, new premium category brands which present a personlaity of style and sophistication combined. The brands are associated with and targeted at achievers who have a certain flair and pinnache about them. Promotion for these brands is also exclusive (atleast in the initial stages) featuring high quality prizes and schemes.
  2. The second key finding of the model was regarding brand smoothness and availabilty. JPGL scored highest in these areas. Current brand strategy is designed to maintain and uphold the brand’s strength in this particular dimension.
  3. The Red & White packet was considered the least costly of all. Current brand strategy has countered this finding by introducing the Gold Leaf Tens pack. This packet is priced one rupee lower than the R&W pack which sells for around Rs. 18.5 in the market.
  4. Consumers gave the highest weightage to price and taste attributes in cigarettes. Current brand strategy, recognizing the importance given to these attributes, has produced two new brands which are not only competitive where price is concerned but which also offer a unique, smooth taste of Virginian blended tobacco. The on-going test marketing of the Tens pack has proved to be a great success, with demand from retailers rising all the time. Its low price combined with the same great taste of the original JPGL brand, seems to be an unbeatable combination. Furthermore, the Max pack, which is targetting premium category brands, is also lower in price than the competition without losing its greta taste.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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