IndexTrends 3Analysis

Value Chain 7SWOT 8Blue Oceans 10Porter Forces 11

Strategy 12Brand Positioning 13Position Statement 14Customers 15

Product 19Revenues 21Brand Mantra 27Brand Elements 28Brand Experience 30Goals and Objectives 33Conclusions 34

In Spain:

More than 55,000 people per yeardie from smoking

In Spain:31% of the population smokes

17.3% are former smokers

United States:1965 – 42% of the population

smoked

2012 – 18% of the populationsmokes

1 of 4 males students smoke

1 of 5 females students smoke

14 is the average age when teensstart smoking

8.4 billion dollarsspent on advertisement just in

the US

Due to laws enforced, the tobacco industry has been forced to changetheir advertisement strategies, making them changing their packagingimages.

The Marlboro Package now comes with very graphic pictures about therepercussions of smoking.

The World Health Organisation strongly believes this works

However, even though the porcentage of population that smokes has decreased through the years, it seems the percentage of people whodo smoke, have increased their consumption, projecting growth in thetobacco market forecast.

• Value Chain

• SWOT Analysis

• Blue Oceans

• 5 Porter Forces

Tobacco Harvesting

• Malawi : more than 90% of Malawi's tobacco is bought by two US-based leaf buyers.

Manufacturing: Machine, qualitycontrol

•1. Universal Corporation

• 2. Alliance One International

• They resell to international firms, including MARLBORO

Packaging

•Godfrey Phillips

•Philip Morris

Distribution

• Same as Packaging

Retailers

• Supermarkets

• Clubs

• Bars

Merchandising

• Sponsorships

• Advertisement

• BTL

Consumers

• Final consumerof Marlboro

Strengths Weaknesses

• Available in seven variants• Wide distribution network of Godfrey

Phillips.• Strong campaign in terms of ‘Marlboro

Man’ also a well-known brand• Strong brand name and top of the mind

recall• Association and sponsorship of various

events• Good marketing through print ads• Quality Product• Well known• Strong Man Power and Employees

• Weak position in certain markets and segments (e.g. Menthol cigarrettes)

• Health destroying products.• Competing with its own brands

Opportunities Threats

• Large tobacco industry in India resulting in huge growthopportunity

• Social media marketing as a replacement for advertisement

• Consumers already know thebrand

• Large natural resources of tobacco in India

• Heavy smokers will not quitsmoking

• Lot of competitors with similarquality and price.

• Growing public concern aboutincreasing use of tobacco

• Government regulation andincreased taxation

0

2

4

6

8

10

12

Price Pre fabricated Variety Advertisement Lifestyle

Marlboro

Camel

Loose Tobacco

Brands: Camel,

Lucky Strike, Derby

Bargaining Power of Suppliers:

Increasing cost of tobacco due to the limitation and

high tax from the government.

RISK: 4

Bargaining Power of Customers:

Different ChoicesTobacco is Harmful (Choice

to quit)RISK: 3

Threat of Substitutes:

E-Cigars

Water Cigarettes

Nictine Patch

Nicotine Free/No addiction

RISK: 5

Threat of New Competitors:

Development of new brands is low, due to the

tobacco situation

RISK:1

• FOCUS - DIFFERENTIATION:• Cork-looking filters

• Filter Plus Technology: Revolutionary flavour enhancering

• Aggresive Distribution and Merchandising Strategy: Clever BRANDING Strategy

• Acquiring the MARLBORO Lifestyle

• Good Placement for product

• Adoption of the brand by the consumer (if it is not Marlboro, they’d rathernot smoke)

• Targeting Financially attractive groups: Young Males

• Creating Brand Remembrance through “Marlboro Man” – even fornon-smokers

• Marlboro forms part of POP CULTURE – Product Placement in movies, known for its “manlyhood”

• Targeting Big Cities (Billboards)

• Targeting Big Events (Sponsorship – Formula 1)

• Brand Personality: Confident, positive, succesful, achiever, dynamic, optimistic

MARKET/FRAME OF

REFERENCE

Marlboro’s market is without a doubt the tobbaco industry, world wide, since it is a world renowned brand, and it is sold in all the countries. Therefore, Marloboro’s market/frame of reference is everywhere in the world where tobacco is sold.

PRODUCT

What Marlboro offers is high quality cigarettes at an affordable price. It also sells the quality, freedom and lifestyle that comes with the brand when you are a Marlboro consumer.

CUSTOMERS

Marlboro’s customers are adventurous, young people, who are looking to live on the edge and being free. Since it is a quality brand, it is focused on middle-high class target.

• The main customers Marlboro targets are people who consumecigarettes (smoke) over 18 years old (legally).

• However, given the popularity of smoking amongst younger people,through their communication they also target this younger audience.

DEMOGRAPHIC

YOUTH: 14-25 years oldADULT SMOKERSMIDDLE-HIGH CLASS, EDUCATED PEOPLE

GEOGRAPHICALWORLD WIDEFOCUSING ON DIFFERENT TASTE

BEHAVIOURALINDIVIDUALITYLIFESTYLEFREEDOMDECISION MAKING

• Every country where Marlboro is sold.

• Countries with higher Tobacco Consumption• It is noted that consumption of tobacco has

decreased in developed countries and isincreasing in developing countries

Ranking Country Number of Cigarettes Per Adult Per Year

1 Bulgaria 2924

2 Serbia 2822

3 Greece 2795

4 Russia 2786

5 Moldova 2479

• The product Marlboro sells is the“Marlboro Lifestyle”

• This lifestyle predominantly consistsof encapsulating the AmericanDream Lifestyle and turning it into aninvitation to join the “MarlboroCountry”.

• Given the popularity and desire ofwanting to belong in said lifestyle,Marlboro succeeds in expandingworld wide.

• BE MARLBORO

• Marlboro has to sell this because thecigarettes are their main product

• Personification of the brand using the Marlboro Cowboy and promotingthe Marlboro Country Lifestyle

• Relating smoking to something cool and manly through big advertisingimages

• Product Placement in movies (strong in the Western Movies mostly)• After restrictions on Advertisement:• BTL Actions

• Hosting events and parties• Sponsorship (such as Formula 1)• Colour branding (the use of only de Marlboro “M” and red colours)• “Switch Selling”• Marlboro Club

• Marlboro gets its revenues from selling dried and processed tobaccoforming the cigarette we know as Marlboro.

• Even though they have few other things such as Marlboro lighters,their main product are the cigarettes.

by a higher excise taxes, Spain’s10 million-plus smokers havebecome targets for cigarette

smugglers.

Illegal imports now accountfor 7 percent to 8 percent of

overall cigarette sales

The number of cigarette packs sold in Spain fell 17 percent lastyear, according to the Tobacco

Market Commission

During the four year 2008-2012 sales of traditional cigarettes in Spain dropped by over 40% from

4514 million packs to 2671 million

PENETRATION RATE:

young teenagers (12-14 years) younger (below 25) older (over 50) men.

TARGET MARKET : PEOPLE WHO SMOKE CIGARETTES (30% of Populationaccording to INE-14,000,000)

AVAILABLE MARKET: TEENAGERS, WOMAN AND MEN (85% of population-39,500,000)

POTENCIAL MARKET: THE CITIZENS OF SPAIN. (46,507,760)

2671 Million packs of cigarettes approximately sold per year

47.7 billion units approximately sold per year

Marlboro Market Share in Spain is 31.2%, for a total of 14,9 billion units of cigarettes sold corresponding to Marlboro and 833 million packs.

A pack of Marlboro costs approximately 4,65 euros

Marlboro estimated sales are 3.8 billion euros.

THE DIFFERENT OF REVENUE OF MARBOLO

TYPES REVENUE

TRADITIONAL 50%

LUXURY 21%

SELF--MADE 24%

WOMEN MEN

1970 10% 65%

2009 21% 31%

0%

10%

20%

30%

40%

50%

60%

70%

Axi

s Ti

tle

The prevelance of cigarettes smoking among 15 years and over

WOMEN MEN

1970S nad lae 1980s 3 11

2000s 6 8

0

2

4

6

8

10

12

Axi

s Ti

tle

Cigarettes smoked per person per day

MARLBORO EMOTIONAL DESCRIPTIVE BRAND FUNCTIONS

FREEDOM

When people consume Marlboro, they are living up their freedom, they are confirming they are

owners of their decisions and that they don’t follow

society’s rules.

LIFE-DRIVEN PEOPLE

It is a brand that is aimed for people who are

looking for adventure and living on the edge. Of living life to its fullest.

PLEASURE

The nature of Marlboro is to provide people

pleasure and leisure, with a high end quality product

enhancing the experience.

BRAND ELEMENTS

BRAND AS A PERSON

BRAND AS A SYMBOL

MARLBORO RED

MARLBORO MAN

HIGH RECALL VALUE

DON´T BE A MAYBE

TRADICIONAL

LOGO DESIGN : SYMBOL OF RUGGED, INDIVIDUALISM AND MASCULINITY

BRAND EXPERIENCE

Marlboro literally uses the “Marlboro Experience” to involve the consumers, making them a very important part of their brand.

They use events, parties, rallys and all sorts of different activities and ideas to engage with the consumers and make them relate with the brand.

Marlboro sets up the whole environment, and through the activities and decoration, is constantly getting the message to the consumers.

The final goal is to make the consumers more loyal to the brand, and make the appreciate what Marlboro does for them, thus, creating the loyalty desired.

TMX

TMX is The Marlboro eXperience.

This experience gathered hand picked consumers by Marlboro and took the away to a big event with different activities and dynamics planned. This activities included involving the consumer in the cigarette-creating process, making them come in contact with the tobacco itself and constructing a cigarette themselves. This is the most involvement a brand can get with their consumer, by making them a part of the process.

Afterwards, fun activities, in relation to Marlboro sponsorships, are planned, such as driving race cars.

They do this in select countries.

http://www.youtube.com/watch?v=88LhpduH-Po

Marlboro Parties

Whenever launching a new product, Marlboro organizes a Launch Party, where, once again, they hand pick guests to invite, and cover all their expenses, making this, the Marlboro Experience.

The fact that all the guests get to go to a party, without having to pay for anything, again, engages them all the way with the brand, because not only do they get to see first hand what the brand does and has to offer, but they relate to all the actions, and feel they are becoming a part of the brand, they are the brand, they are Marlboro.

http://www.youtube.com/watch?v=ATEd2zhwRCk

Goals and Objectives

Objetives(and goals):

• Reinforce stature as brand of clear first choice and loyalty among all audience segments.• Deliver relevant and compelling messages to diverse audiences.• Core Marlboro imagery through Red and Lights – most popular products• Deliver idea and lifestyle that is “bigger than life”

• Build noticeability, likeability and contemporarity in brand image.• Involve consumers in process of the brand• Create diverse actions/events where brand is present but not tobacco based.• Endorsement and sponsorships of heroic, cool and adrenaline scenerios

• Increase our market share.• Make Marlboro the brand to be consuming• Venture into other products, alternates, as to not lose consumers• “Flip” Strategy

• Sustain and increase our sales.

Marlboro since the creation of the brandhas been working on getting through toits target the most effective way and has achieved it.

This has given the brand the power and strength to pullthrough all the adversities the tobacco industry isfacing

The brand has loyal consumers which do not needadvertisement reinforcement in order to buy Marlboroover any other brand