Report About British American Tobacco Entry Strategy In Bangladesh

1. S U C C E S S & R E S P O N S I B I L I T Y G O T O G E T H E R

2. INTRODUCTION
British American Tobacco P.L.C. is the world’s most
international tobacco group. Based in London, UK it is a market
leader in more than 50 countries selling over 300 brands in
some 180 markets world-wide with the strength of almost
90,000 employees. British American Tobacco Bangladesh, a
market leader in the country, is a subsidiary of British American
Tobacco BATB give too much priority to internal
communication.

3. BRITISH AMERICAN TOBACCO IN
BANGLADESH
British American Tobacco Bangladesh began its operations in
the subcontinent in 1910 as Imperial Tobacco Company Ltd
with its head office in Calcutta. Bangladesh Tobacco Company
Pvt. Limited (BTC) was formed in 1972 with British American
Tobacco holding major shares in Bangladesh Tobacco
Company. In March 1998 Bangladesh Tobacco Company
changed its name and Identity to British American Tobacco,

4. CORE BUSINESS ACTIVITIES
• Tobacco Leaf Growing
• Leaf Processing
• Cigarette Manufacturing
• Distribution

5. ENTRY STRATEGY
• Political
• Economic
• Government
• legal

6. “Success and Responsibility Go
Together”

7. CONTRIBUTION IN THE LOCAL
EMPLOYMENT SECTOR
• According to a study of the International Labor Organization (ILO), the
unemployment growth rate of Bangladesh in 2016 was 3.3%
• British American Tobacco Bangladesh is playing an important role by
providing employment opportunity. Directly and indirectly many people
work in British American Tobacco Bangladesh
• In Bangladesh directly employs more than 1,200 people and indirectly
employs more than 50,000 people (mostly farmers).

8. MARKET SEGMENTATION

9. MARKET SEGMENTATION
• BATB cover almost full market share of Premium and Medium.
Segment Brands
Premium Benson & Hedges Lights, Benson & Hedges Full Flavors
High John Player Gold Leaf, Pall Mall Full Flavors, Castle, Pall Mall Lights, Pall Mall Menthol,
Capstan Filter
Medium Star Filter, Scissors Filter
Low Pilot

10. MARKET SHARE OF BRITISH
AMERICAN TOBACCO BANGLADESH
Premium
52%
High
9%
Medium
28%
Low
11%
Share

11. COMPETITORS
• 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, Maries

12. TARGET MARKET
• British American Tobacco Bangladesh’s target market is only Smokers who are more
than eighteen (18) year old and above

13. MARKET POSITIONING
• British American tobacco, usually determine their 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 Gold leaf are available everywhere in urban or metropolitan areas
• Pall Mall 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

14. EVALUATION OF SBU’S BY BCG
MATRIX

15. EVALUATION OF SBU’S BY BCG
MATRIX
• STAR: Stars are high growth high market share businesses or products. The BATB
does not have any product inside STAR.
• CASH COWS: Cash cows are low growth and high market share business or
products. BATB’s product Gold Leaf & Star are inside Cash cows.
• QUESTION MARKS: Question marks are low share high growth businesses or
products. B&H and Pilot are inside Questions marks.
• DOGS: Dogs are low growth and low market share business or products. Pall Mall,
Scissors, Capstan are inside Dogs.

16. MARKETING PROGRAMS
• All marketing is based on the fundamental ’5 Ps’: Product, price, packaging, promotion
and place. For BATB, promotion is now much more limited and very carefully
controlled
• British American Tobacco Bangladesh does not have any permission to advertise their
product publicly. But they try to promote their product by giving there retailer leaflet
• They got an extra force of personal sellers who tries to promote BATB’s brands by
pleasing the consumers.

18. BAT B PRICING STRATEGIES COMPARE
WITH BAT GLOBAL PRICING
• can vary from market to market or product to product
• Bangladesh is an over populated country. There are 7.12 crore male in our country.
Most of the male doing smoke.
• smoking is harmful to our health .So Govt. impose high amount of tax on tobacco
product for reducing use of product
• The price of B&H per packet is 210tk (20sticks). so its price is very high for
Bangladeshi people according to their per capita income
• On the other hand the price of B&H size cigarette (20) in U.K is about 7.35 Pound
which in Bangladeshi currency is about 770tk where in Bangladesh 210tk(20).

19. BAT B PRICING STRATEGIES COMPARE
WITH BAT GLOBAL PRICING
0
100
200
300
400
500
600
Netherlands Honduras Mecadonia Angola Nigeria Azerbijan
Series 1
The cigarette price comparison chart shows that price for B&H (per pack) in
Bangladesh is 268.42% lower than the same cigarette price in Netherlands.
So, here we can see that the price varies globally.

20. PORTER’S DIAMOND MODEL

21. PORTER’S DIAMOND MODEL
• Factor conditions: Porters argue that “key” factor of production are created not inherited. Main
factors of production are skilled labor, capital and infrastructure
• Demand condition: In our country 7.12 crore are male among total population. Most of the male
above 80% male doing smoke in Bangladesh. So, BATB takes a right decision to set up a
business in Bangladesh because here they can find easily a big amount of their product
demand.
• Supporting industries: supporting firms should be located in same area. BATB is located in
Mohakhali DOHS but their suppliers far away from their firm.
• Firm strategy: BATB entered through FDI in Bangladesh. Their strategy enable their business
to deliver growth today .They is continuing to invest to more grow up. Since, tobacco is the core
of their business and it will continue to provide with opportunities for growth.

23. SWOT ANALYSIS
Strength:
• BATB is well known brand in the Bangladesh. So, the brand name is a strength for BATB
• Because of high regulations and high entry barriers new entrants are discouraged and it’s good for current and established
market player.
• No need to promote their product towards the customer
• Strong Financial position
• Strong market position
• Technology and product innovation
Weakness:
• Dealing with a product which is sensitive in many issues.
• Can’t promote their product.
• A high volume but low value industry
• Centralize decision making. Every decision made from Hong Kong

24. SWOT ANALYSIS
Opportunity:
• In Bangladesh, tobacco market is pretty strong.
• Migration rate is good enough to sustain the cigarette industry.
• Among the sale of tobacco products, 42% is cigarette.
Threat:
• Increasing amount of awareness among the consumers about the health risk caused by
smoking.
• Increasing number of regulations and laws imposed by government about selling
cigarettes.
• E- Cigarette

25. RECOMMENDATION
• BATB must further focus on price, quality and performance of their product lines and
brands to stay competitive in the industry.
• Although people are becoming more aware of the health, so BATB should research for
better verity of tobacco leaves.
• Identify opportunities and build on strength.
• It can think of focusing on unrelated business diversification.
• They should maintain strong relationship with its suppliers and customers.

26. CONCLUSION
• BATB has established value addition in every stage of the supply chain. BATB is a
company with world class people, products, system and process. BATB is a leading
company in the cigarette industry in Bangladesh with a market share of more than 50%
and employee more than 1,200 people directly and they provide indirect employment
to more than 50,000 people as farmers, Distributors and local suppliers.
• The way BATB operating their business world enables them to be the market leader for
a really long period of time.

27. THANK
YOU