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Product and Brand Management: Brand Equity of Marlboro Cigarettes
Submitted by Deepali Kalyanpur E-2 Shantanu Pathak 86 Prakash Menezes 90 Prathyusha Atmakur 92 Prerna Kakkar 93 Sharath C George 111

.............................................................................................................................................................................................................................................................................................................................TABLE OF CONTENTS Industry overview ............................................ 7 Methodology used .................................. 5 Value proposition .............................................................................................................................................................................................................................................................................................. 3 LIST OF FIGURES FIGURE 1: TOP 10 INDIAN CIGARETTE BRANDS – RETAIL VOLUME (%) .............................................................................................................................................................................................................................................................................................................................................................................................. 6 Brand equity assessment ....................................... 7 Contradiction ................................................................................................... 8 Conclusion .................................................................... 3 Competitive Landscape ...................................................................................................................................... 3 TABLE 2: TOP 5 BRANDS IN THE WORLD ............................................................ 5 Identity ...................................... 8 LIST OF TABLES TABLE 1: LEADING CIGARETTE COMPANIES IN INDIA AND THEIR BRANDS ..................... 7 Primary research ................................................ 3 Product & Brand Management Project 2 .............................................................. 7 Secondary research .................................................................................................................................................................................. 5 Imagery .............................................................................................................................................................................................................................................................................................................................................................. 7 Reasons cited for our results – The CAUSE .......... 8 Questions Used ............................................... 7 Analysis – The EFFECT .................................................................................................................................................... 4 Brand Meaning........................... 5 Brand Equity Evolution ............. 3 Types of Branding .....................................

I-gen.ITC Ltd. PMI currently owns a 25% stake in Godfrey Phillips India. Godfrey Phillips India Ltd (GPI). Jaisalmer. Four Square. Charms Virgina Filter and Charms Smooth Filter Panama. Tipper . and Vazir Sultan Tobacco Company (VST) and Golden Tobacco Company (GTC) dominate the cigarette market in India. Marlboro Mild Seven L&M Winston Camel Manufacturer Philip Morris Japan Tobacco Philip Morris R. The iconic Marlboro cigarette brand is manufactured and distributed under licence by Godfrey Phillips India since 2009. Reynolds R. December 2010 (in turn sourced from © 2010 Euromonitor International) Besides Marlboro. Taj Chap. and State Express 555. June. 4. Marlboro Menthol. Philip Morris International (PMI) ended its 6-year old association with local partner Barakat Foods & Tobacco for the distribution of Marlboro cigarettes in India and collaborated with Godfrey Phillips India in 2009. Diet Blue Godfrey Phillips India Ltd. Just Black. India Kings. North Pole Special Extra Filter. TABLE 2: TOP 5 BRANDS IN THE WORLD Brand 1. Chancellor. Moments. Reynolds Cigarettes Sold 472. Marlboro Black. Steel. These three account for 96% of the total cigarettes volume sales during 2010. Marlboro 100s. ITC Ltd leads the market with a 75% volume share followed by GPI and VST held volume shares of 14% and 8% respectively. Marlboro brand is available at select cities in India at approximately 65. The balance 3% is held by Golden Tobacco and Japan Tobacco Inc (JTI).3 billion 59. Gold Flake. other international premium brands sold in India include British American Tobacco’s Benson & Hedges. Berkeley. North Pole. 3. Red & White. Bristol and Flake. Japan Tobacco Inc’s Winston. FIGURE 1: TOP 10 INDIAN CIGARETTE BRANDS – RETAIL VOLUME (%) Product & Brand Management Project 3 . Marlboro Ultra Lights). Scissors. Style Mini Kings. Classic.7 billion 106. Golden.000 retail outlets. Capstan. 2. (GPI) Vazir Sultan Tobacco Company Golden Tobacco Company Source: Campaign for Tobacco-Free Kids.2 billion 91. Lips. Lucky Strike. Marlboro Gold Advance. Players. Marlboro Lights. 5. Marlboro. Three leading players .Stellar.7 billion 111. Davidoff (Imperial Tobacco).3 billion Source: ACS: The Tobacco Atlas 3rd Edition 2009. Navy Cut. List Notes: Data updated by Top 5 of Anything: March 2010 . TABLE 1: LEADING CIGARETTE COMPANIES IN INDIA AND THEIR BRANDS Players ITC Limited. Silk Cut and Duke FSI. Cavanders.J.INDUSTRY OVERVIEW COMPETITIVE LANDSCAPE Cigarettes constitute only 14% of the total tobacco products market in India. The brand has 7 variants in India (Some of which are Marlboro Regular.J. Portfolio of Brands Insignia.

2003 (COTPA) enforce many rules and laws with respect to tobacco advertising. Production. Supply and Distribution) Act. large billboards. Women Empowerment  Product & Brand Management Project 4 .GET FAMOUS. Blood Donation Drives.be Tamil Nadu’s Next Singing Sensation” was promoted through limited edition cigarette packs. some of the types of branding adopted by these Cigarette companies are as below:  Events Branding: o The ITC group uses 2 of its popular cigarette brands. hotels having 30 or more rooms. and restaurants having seating capacity for 30 or more Advertising on international broadcast media General sponsorships by the tobacco companies that does not involve the promotion of tobacco products Branding is a challenging affair for the Cigarette industry in India. However. point of sales displays and contest entry locations across the city Cause Branding in the form of Corporate Social Responsibility o Godfrey Phillips Bravery Awards (instituted in 1990 and has saluted more than 1200 individuals since then). as the brand name of lifestyle retailing stores that sell clothing. sponsorship along with packaging and labelling guidelines. Currently the law permits:     Point of sale advertisements Establishment of smoking areas or spaces in airports. sponsored a concert series and talent contest in the city of Chennai. Wills and John Player. promotion. Four Square. December 2010 (in turn sourced from © 2010 Euromonitor International) TYPES OF BRANDING India being a party to the WHO Framework Convention on Tobacco Control (2004) and with its own legislation .Source: Campaign for Tobacco-Free Kids. The event titled “Four Square.The Cigarettes and Other Tobacco Products (Prohibition of Advertisement and Regulation of Trade and Commerce. The Wills Lifestyle brand sponsors India’s annual Fashion Week and has its own clothing stores across 40 locations in India thereby stretching the cigarette brand name associating it with the glamour of fashion o In 2009. the popular Godfrey Phillips India brand.

admire his strength. It always shows a rugged masculine smoker smoking a rich yet mild cigarette. Godfrey Phillips WHITE. trustworthy. mellow cigarette yet not weak Remained single minded from the 1950s till date. Media agency Leo Burnett created the macho icon as a way to reposition Marlboro from a "mild as May" ladies cigarette to a product with broader appeal. women empowerment and environmental initiatives BRAND MEANING IDENTITY Marlboro’s identity: “All-American. environmental management In 2000. the ITC launched e-Choupal. self-sufficient. Product & Brand Management Project 5 . VALUE PROPOSITION Smooth. There was a need for this complete shift in image due to the low sales of women cigarettes and also the early introduction of filters which were not so popular among the men folk. cowboys and sailors were used to communicate the brand essence. confident. in charge.” IMAGERY Marlboro Man stands worldwide as the ultimate American cowboy and masculine trademark. to a digital infrastructure that enables them to link to a more formal market. down to earth. Marlboro started off as a women’s cigarette with the tagline “mild as may” as they had red filters to hide the lipstick stains. man’s man (experienced. cool/calm. rugged individual. Football players.o projects(under the name Amodini). various GAP (Good Agricultural Practices) and support programs for tobacco farmers. which connects over 4 million farming families. The ads were very aspirational and certainly caught the eye of an American man. sure of self. Marlboro imaged itself by showing real men and not models in their advertisements. pilots. ITC also supports primary education. hardworking. get the job done). In 1954 it transformed itself into a true masculine brand.

Marlboro positioned itself as a ‘Mild as May’ cigarette for women and had the tagline “Discerning feminine taste is now confirming the judgment of masculine connoisseurs in expressing unanimous preference for the Aristocrat of Cigarettes. Product & Brand Management Project 6 . which resulted in some goof ups like the stirrups on the horse being upside down. As a result most of the non filter brands were eliminated or lost their market share to the filter brands. They also launched a trademark tattoo on the cowboy’s arm. even though Philip Morris had his doubts whether men in towns and cities will associate themselves with cowboys. Some men even used to smoke it secretly. Marlboro decided to reposition itself as a man’s cigarette to target a wider market. Therefore they stopped using professional models and started recruiting real cowboys from Texas and Montana to act in the advertisements.” Marlboro was a filter cigarette. The negative publicity affected the segment and cigarette sales dropped for the first time in the United States. Marlboro had long positioned itself as a safe and mild brand. Philip Morris wanted a classy sophisticated name for their brand. looking into the distance with his trademark silent. unlike many of the other brands. even denying it outright and disputing the claims of the study. At the same time. Philip Morris’s marketing team liked the sound of Marlborough but decided to change the spelling to Marlboro. Philip Morris hired the Chicago based advertising executive Leo Burnett to design a repositioning strategy. Even when television ads for cigarettes were banned in the ‘70s. . He started off with the image of a cowboy. Marlboro felt that they needed to do things differently as their sales volumes weren’t high. However the problem was that even men who wanted to smoke Marlboro was afraid to be seen smoking it due to the association of the brand as a woman’s cigarette. At that time. In the beginning Marlboro used professional models dressed up as cowboys. Cigarette companies started scrambling to downplay the harmful effects of smoking. ship captains. bodybuilders. that is in the early 1950’s. Burnett’s agency also launched a tagline “Come to where the flavour is…. Also women were very concerned about some of the normal side effects of smoking such as foul breath. Such mistakes resulted in some embarrassment for a company positioning itself as an ultra masculine genuine brand. Marlboro went from a nobody to the fourth highest selling brand in a single year. . The Marlboro Man campaign has been one of the most successful marketing campaigns in history and has given Marlboro the status of the most valued brand in the world. At this time. At the same time they got into a turf war with each brand claiming their brand was safer than the others. However Burnett persisted and convinced Morris and launched the cowboy campaign and had huge success. The Marlboro brand was launched as a cigarette for women. However after two decades. stained teeth. Burnett started using a series of the manliest images possible – soldiers. etc. scientists published a study linking smoking to lung cancer which received wide publicity. etc. The women’s cigarette segment had a low share of the market. Winston Churchill was prominent on the world stage and there were rumours that he was related to the Earl of Marlborough. At the time the idea of marketing cigarettes to women was itself a taboo. So they had a huge opportunity to capture the market in a scenario where even smokers were looking for milder brands. the Marlboro cowboy smoothly transitioned to billboards and hoardings. smouldering squint.BRAND EQUITY EVOLUTION The brand Marlboro was launched in 1924.Come to Marlboro Country”. . the ‘Reader’s Digest’ magazine also published a series of articles highlighting the harmful effects of smoking. This helped to alleviate some of the fears about harmful side effects. The purpose of this band was to hide unattractive lipstick stains on the cigarette and also to highlight the presence of a filter. The marketers made the filter prominent by putting a red band around the filter.

BRAND EQUITY ASSESSMENT METHODOLOGY USED We conducted a primary research to understand the current trends relating to consumer behavior with respect to Marlboro cigarettes and combined it with secondary data to analyze the aspects related to equity. SECONDARY RESEARCH: We referred to the data available online on several websites and journals available in the library. Brand image – the most common aspects associated with this brand were that of masculinity. and ruggedness. Only residents of America can register on Marlboro’s official website. Purchase frequency – it was observed that this brand is purchased usually only by occasional smokers. and surrogate advertising to create awareness.In spite of the decades that passed by and changing perceptions about smoking. non-smokers. So the companies rely on convenience displays. Marlboro being an international brand has several ads.e. Psychological preferences – Indian men prefer lighter cigarettes. We were able to derive a cause and effect relationship by this interpretation. who buy single cigarettes rather than a pack of cigarettes. as we analyzed the secondary data to be factual information as the reasons due to which the primary responses PRIMARY RESEARCH: We surveyed 30 people in the age group of 20 – 35 years with the income levels ranging between the middle class and upper class segments. as it had a stronger taste. We classified our respondents in three categories for our convenience. Product & Brand Management Project 7 . Marlboro cigarettes are considered to be too strong in taste by Indian standards. and regular smokers. Some respondents even mentioned high prices and sophistication. These ads use a figure called the ‘Marlboro man’ which shows a cowboy and conveys an image of masculinity. Thus Marlboro did not appeal the taste buds of Indian masses. occasional smokers. This is the extent to which this brand has secured its information. REASONS CITED FOR OUR RESULTS – THE CAUSE Advertising and promotion of cigarettes is banned by the government of India. i. and it was one among the top five brands that they could recall. promotional schemes. strength. the world continues to love the cowboy. ANALYSIS – THE EFFECT We have summarized our findings based on the following parameters which also describe the degree of brand equity: Brand awareness and recall – 95% of our respondents are aware of this brand.

The international campaign and image of Marlboro has been able to create brand awareness in India.Brand loyalty – only one of the respondents surveyed was a loyal smoker of Marlboro cigarettes. as compared to other countries like USA. QUESTIONS USED Do you smoke? What are the first five cigarette brands that you can recall? What is the image that you associate to Marlboro cigarettes? Which brand do you smoke? Are you loyal to your brand of cigarettes? What are the factors you consider before buying cigarettes? Can you associate to the brand by seeing an advertisement/logo? Do you relate to the brand? Product & Brand Management Project 8 . CONTRADICTION Marlboro is actually priced lower than most of its competitors like Classic Ultra mild. but it has failed to generate similar revenues. Its high pricing strategy is only a misconception in the minds of the consumers. he was not very keen on recommending them to regularly smoke this brand. Willingness to recommend – Although the loyal Marlboro smoker was willing to offer a cigarette to others. the brand equity of Marlboro cigarettes is very low in India. CONCLUSION On a whole.

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