British american tobacco Bangladesh

1. Bangladesh

2. Md.Monirujjaman
Daffodil International University
Department of Nutrition and Food Engineering

3.  British American Tobacco Group is the world’s second
largest quoted tobacco group by global market share,
with brands sold in more than 180 markets. The
business was formed in 1902, as a joint venture
between the UK’s Imperial Tobacco Company and the
American Tobacco Company founded by James ‘Buck’
Duke.
 In Bangladesh: British American Tobacco Bangladesh
is one of the largest multi-national companies in
Bangladesh. They have over 1200 employees in
Bangladesh. British American Tobacco Bangladesh is
one of the first companies to be listed on the Dhaka
and Chittagong stock exchanges. Currently it ranked
amongst the top 10 companies in terms of market
capitalization.

4.  British American Tobacco Bangladesh is the
market leader in tobacco sector. in
Bangladesh BATB have only few brands is-
•Benson & HedgesPremium
•Gold Leaf, Pall Mall, CapstanHigh
•Star, ScissorsMedium
Low-Pilot, Bristol, Hollywood

7.  The industry is rated very low 2 on this
parameter. Low substitutes and a very close
pricing of the competitors in the industry leave
very low bargaining power for the buyers,
especially in the low priced segment. But in the
medium priced segment, quality and price are
factors key for substitution and therefore,
different brand preferences are available in the
market and the market share of each competing
rivals tend to shift in very significant margin. But
it is not very relevant scenario for the premium
segment, where most of the customers are loyal
to their brands.

9.  The industry is rated 3-4 on this parameter.
As the products are classified as Fast Moving
Consumable Goods and produced in all over the
world, all the firms have the leverage to choose
the wrapping materials from anywhere in world.
These materials are cigarette paper, aluminum
foils, boards, filter papers, cellophane paper etc.
Tobacco for medium and low price segment
cigarette is grown in Bangladesh and is capable
of fulfilling the entire industry demand. Tobacco
for premium priced cigarette are also grown in
Bangladesh and around 18 – 20% high quality
tobacco is imported from different tobacco.

10. Environmental
Analysis:
• Political
• Economic
• Social
• Technical
SWOT
Analysis:
• Strength
• Weakness
• Opportunity
• Threat
STP Analysis:
• Marketing
Segmentation
• Target
Marketing
• Marketing
Positioning

11.  Political Analysis:
Government regulations have increased in the
recent years. Tobacco companies can not use
any vehicle to promote any of their products
and they also can not organize any event.
Or competition with their brand name. That is
the reason BAT had to stop organizing a
popular program of their’

12.  Economic:
Usually price increased do not affect the brand
loyal segment, but the lower segment gets
influenced with he price increase. Like, even if
BAT increases the price of B & H, it might not
affect the brand loyalty of the customers, but the
price increase of star may influence the customer
to shift to navy.

13.  Social:
Increasing awareness of the consumers might
well affect the sale of the brands. Increasing
health campaign, awareness and lifestyle of
people also affect the consumption of cigarettes.
Like more stressful life can lead to more
consumption of cigarettes. People also get
influenced in choosing their brands influenced
by their peer or reference group.

14.  Technological:
The production of cigarettes and quality control
and checking can have influence on the overall
production process to a great extent. Import of
new machinery includes a lot of internal
communication with the factory workers to make
them understand the operation and also to
reduce their fear of getting laid off because of the
new machinery.

15. Short Term Mid-Term Long Term
Trend
Neutral Bullish Bullish
Resistance
3 893 3 893 4 068
Spread
-0,69% -0,69% -5,0%
Spread/Suppp.
4,3% 8,0% 6,8%
Support
3 706 3 578 3 621

16.  SWOT Analysis is an important tool for
evaluating the company‟s strengths,
weaknesses, opportunities and threats. It
helps the organization to identify how to
evaluate its performance and scan the macro
environment.

17. Strength:
Because of high regulations, high cost and high
entry barriers, new entrants are discouraged,
which is good for the current and already
established market

18.  Weakness:
Dealing with a product which is sensitive in
may issues.
Can not promote their products using public
media vehicle.
A high volume but low value industry.

19.  Opportunity:
In Bangladesh, tobacco market is pretty
strong. Among the sale of all tobacco
products, 68% is Bidi and the rest 32% is
cigarette. But with the up gradation of
purchasing power and good economic
condition, high rate of migration from Bidi to
cigarette is also expected.

20.  Threat:
Increasing amount of awareness among the
consumers about the health hazards caused
by smoking.
Increasing number of regulations and laws
imposed by the government about smoking
and selling cigarettes.

21.  Merketing Segmentation:
Dividing a market into distinct groups of
buyers who have distinct needs,
characteristics, or behavior and who might
require separate product or marketing mixes.

22.  Terget Marketing:
Target market is the process of evaluating
each market segment’s attractiveness and
selecting one or more to enter.
British American Tobacco Bangladesh’s target
market is only Smokers who are more than
eighteen (18) year old and above.
 Adult
 Old
 Adulthood

24.  Market positioning:
Market positioning is the arranging for a product to occupy a
clear, distinctive and desirable place relative to competing
products in the mind of target consumers. British
American tobacco, usually determine there distributional
channel based on geographically economically and also
based on sales forecast. In the rural area the consumer
needs low priced cigarettes so BATB offers Star, Pilot and
scissors for the villagers, especially Pilot is made for the
farmers and other low classed consumers.
B&H and Goldleaf are available everywhere in urban or
metropolitan areas. PallMall positioned for the consumer
who are aged between (18 to 25). But for STAR there
distribution is not only geographically they keep the lower
income people in mind. Star is available in all over
Bangladesh.

25.  They consider their product segmentation for
following their core competitors in
Bangladesh. The competitive brands are given
below according to the same segmentation.
•Premium- Marlboro
•High- Castle
•Medium- Navy, Rally
•Low- Sheikh, Marise, K2, Five Star, Tope 10,
Nasir Gold, Sun Moon. etc

27.  British American Tobacco is doing a praiseworthy
job in the Corporate Social Responsibility sector
but is lacking the effectiveness and visibility due
to limited communication. The company wants to
establish itself as a benchmark company in CSR
activity. To gain this reputation, the company
needs to focus more on the communication of
the brilliant Corporate Social Responsibility
initiatives that the company is undertaking. The
company should be more vocal about its
achievements and in turn gain effectiveness,
visibility and hence appreciation.