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Marketing strategy of itc
- 1. Marketing Strategy ofITC in Tobacco Industry
- 2. Scope Study theconsumer behaviour in Tobacco Industry SWOT and PEST analysis of ITC cigarettes Porter’s Five forces Model Analysis of cigarette consumption Positioning Strategies Future Research
- 3. ITC Cigarettes Marketedunder 14 different brands 70% market share in the Indian cigarette market Contribute 80% to the total profits Serves 100,000+ markets and 2 million retail outlets
- 4. SWOT analysis World classResearch Efficient Supply chain mechanism Highest Market share Losing out on smokers because of increase in prices Declining sales growth Ethical dilemma Opportunity for Less hazardous low nicotine/ light cigarettes Innovative packing designs Increasing high income group Low entry barrier, low entry cost Increase in excise duty Rising health concerns Strengths Weakness Opportunities Threats
- 5. PEST analysis Smokingin public places is strictly prohibited Advertising of tobacco products is not allowed Health warning labels need to be put up on the packaging Hike of excise duty from 11% to 72% for cigarettes Political
- 6. India isthe second largest producer of tobacco Highly labour intensive, employing 5 million+ people In 2008 recession, sales increased by 11% Lower income groups use bidis as alternatives Economic
- 7. Health consciouspopulation Awareness through advertisement Primary education More rehabilitation centres Social
- 8. Automated productionprocess Smoke-free cigarettes and e-cigarettes New flavours Different packaging Technological
- 9. Porter’s Five ForcesModel
- 10. Highest marketshare of 70% in India No major threat from the existing players in the market Availability at local stores helps beat the competition Competitive Rivalry
- 11. Shopkeepers, friendsare major drivers of consumer choices Suppliers who can influence shopkeeper have great power Brand loyalty is comparatively lower, so availability important Bargaining Power of suppliers
- 12. Greater preferenceto taste than price Easily switch to another brand, low loyalty Shift in consumption from bidis to cigarettes due to higher income Bargaining Power of buyers
- 13. Cigarette industryis very stable New entrant cannot match distribution of existing players Government policy against tobacco acts as a virtual entry barrier Threat of new entrants
- 14. Other formsof tobacco such as bidis, chewing tobacco More health conscious and may switch to less harmful forms of tobacco such as nicotine gums, patches and electronic cigarettes Rehabilitation centres Threat of substitutes
- 15. Data Analysis ofconsumer preference 32% 34% 18% 5% 11% Consumer preference of cigarettes Goldflake Classic Marlboro India Kings Others
- 16. 4 10 15 7 6 16 11 3 5 8 10 13 9 6 4 3 9 9 11 9 11 10 5 8 7 0 2 4 6 8 10 12 14 16 18 1 23 4 5 #ofconsumers Ratings Consumer Priorities Price Taste Brand Packaging Preference Availability Preference
- 17. 0 10 20 30 40 50 60 70 80 90 Friends Advertisements Recommendationby shopkeepers Recommendation by unknown co-smokers Modes of awareness
- 18. Recommendation Count Percentage Promoters13 29.55 Detractors 20 45.45 NPS -7 -15.91 30% of the consumers will actively promote the brand to others as they are loyal enthusiasts and fuel growth Around 45% of the consumers fall into the category of detractors who may impede growth with negative word-of-mouth
- 19. Positioning Strategies Position itselfas the largest producer of cigarettes across India Position its cigarette brands as the most easily available brands in the retail stores Positioned itself as the producer of consistent and superior quality products with the state of the art manufacturing technology Position itself as the producer of all flavours and tastes of cigarettes Functional Symbolic Experiential
- 20. Future Scope/ Foresight Increasing the number of cigarette flavours offered Improving the brand value Penetration to every nook and corner Reduction of focus on packaging Encouraging consumers to actively promote the brand as they are the best source of fuelling growth Cannibalization with respect to ITC
- 21.