Strategic change management of British American Tobacco

Strategic change management of British the Statesn TobaccoBritish America Tobacco ( skim) was boded over 100 days ago, as a joint venture between the UKs Imperial Tobacco Company and the American Tobacco Company in a bid to annul an intense trade war. James Buck Duke orderer of America Tobacco Company became the first chairman. Despite deriving its name from the home bases of its two insane asylum companies, British American Tobacco was established to trade outside both the UK and the USA the two companieswill nottrade in each others ho part servant markets and acquire the right to use each others brands and trade marks in their own territory.The early period of the community formation saw a hand out of expansion, consolidation, merging and de-merging until resent past when the 1902 agreement was revocated and BAT gains exclusive rights of is original brands.The company vision to arrive at leadership of the global tobacco will be based on Growth, Productivity, Responsibility and building a Winning Organization. (BAT, 2008)PRODUCTS OVERVIEWCig arettes This account for about 95 per cent of the company productSmokeless snus Swedish-style snus is a form of tobacco that isnt smoked, usu totallyy placed under the lip, chewed or in the nostrils. It is reported to be much less harmful than cigarettes.Cigars British American Tobacco produces long range of various shapes, strength and flavors.Roll-your-own the oldest form of smoking sometimes referred to as hand-rolling tobacco or fine cut.Pipe tobacco is aged, A pipe standardised tube for smoking tobacco. orbiculate Drive Brands Dunhill, Kent, Lucky Strike and Pall Mall are marks.International brands Rothmans, Kool, Benson and Hedges, 555, Peter Stuyvesant and John Player Gold Leaf. The company is also improving the sales of Vogue and Viceroy.MARKETING STRATEGYStrategic management for most placement is a way of thinking and a barrier used in everyday conversation. A market generally is made up of sellers/pr oducers/suppliers of Products/ services and buyers of these products/ services. Key to this exchange between buyers and sellers is the concept of call for and wants which marketers must(prenominal) strive to satisfy. Marketing is all about getting the right products and services to customers who want/need them. Strategy is looks into the future then develops and implements the plans that will drive the organization in the right direction it presents the broad marketing approach to meet the marketing plan objectives. The marketing planning should be aimed towards designing marketing strategies that are efficient, effective, flexible and adaptable. According to (Brassington and Pettitt 2000), marketing strategy cannot be design in isolation, it has to include the objectives of the organization and take into consideration other strategies of the organization.CompetitionBritish America Tobacco faces competition from many international and local players in the industry. Notable among t hem are Imperial Group, Gallaher limited, Tltria, Japan tobacco, Altadis.They all compete in sharing the Global volume.MarketingThree stages of marketing techniques5Ps(Adapted from the Times 100)Market research enables the organization to identify the most appropriate marketing mix for effective promotion. (The times 100) winning marketing is the bedrock of growth for any fast moving consumer goods business.The company strategy to build its Organization. Growth, according to Marketing placeor, Jimmi Rembiszewski does not mean increasing the derive of smokers rather it means increasing the company share of those adult who have chosen to smoke there by increasing the appreciate of share.Marketing in many businesses is based on the fundamental 5 Ps product, price, packaging, promotion and place. For BAT, promotion is now much more limited and very carefully controlled collect to increasing regulations.ProductProduct value and quality are high on company agenda. The company first Ch airman once said to achieve success there need to be a quality product and right people. BAT also offers consumers smokeless Swedish-style snus, considered to be less harmful than cigarette. worthPricing is one of the most important marketing strategies employed by tobacco companies all over the innovation. The rise of America Tobacco Company was for the most part out-of-pocket to aggressive pricing strategies used by James Duke led to the rise of American Tobacco Company, this was made possible by the cost advantages derived. This oblige competitors to join him or leave the market. (Chaloupka et al, 2002) BAT is prided for quality, choice of flavors, diversified, segmented global brands at the super premium, premium, mid-price and value-for-money price points.PromotionTobacco companies all over the world use myriad activities to promote their products. Laws governing tobacco brand advertising mean that promotion now has far less relevance than the other 4 Ps, and that mass medi a promotion is going or gone. As traditional marketing avenues have closed, tobacco industries now use other marketing strategies. One such(prenominal)(prenominal) strategy is the use of advertainment, possibly derived from two words advertisement and entertainment. This is a way of trying to link brand pictorial matter to an entertainment event.Some of the Activities use by tobacco companies to promote their products includesEvent sponsorshipFor many years Tobacco companies have been using event sponsorships to promote their products, by sponsoring an event, a brand ties that events image to its own. While the parameters within which they can pursue this strategy are narrowing due to legislation, tobacco marketers continue to find ways to make connections between the images of events and the images of their products. bars and ClubsTobacco companies host high concerts and budget parties, which target a particular convention. Tobacco products posters and signs are also used to prom ote the bars.Direct Mail publicizing / Direct MarketingTobacco marketing has in recent past shifted from traditional method of advertising to developing relationships with individual customers. (Anderson, et al). A major piece of direct marketing is direct mail targeted to individuals on tobacco companies extensive mailing lists. Direct mail was found to be a major scattering channel for coupons, sweepstakes offers, brand-loyalty program catalogs and event sponsorship notice. (Delnevo, et al 2004).Point Of Sale AdvertisementAdvertising at the point of sale remains a major subdivision of tobacco marketing. Places where cigarettes are sold are packed with promotional messages. Companies compete for trademark presence and best shelf space. Successful retailers are also rewarded sometimes. (Physicians for a smoke-free Canada 2002).Other methods commonly use by tobacco companies include distribution of Giveaways and Print ads at events.PlaceThe target group must be aware of the exist ence and availability, should never be out of stock and be at the right outlet.SWOT AnalysisThis part depicts opportunities and threats faced by BAT caused by the external environmentStrengthsThe Community and BAT worlds second wide-rangingst quoted tobacco group by global market share, with brands sold in more than clxxx markets . products released under an open-source license meaning it is free to acquire and distribute the licensing structure means can benefit from Community involvement Global tobacco market with largest market in china where around 2,100 billion cigarettes are consumed by about 350 million smokers annually development team and other frequent for the Community and products A very broad geographic base, well placed to meet the changing environment Portfolio of some 300 brands based on unambiguous must-win consumer segments 47 cigarette factories in 40 countries providing farmers with a welcome alternative crop. In many cases, it provides a higher income than any other smallholder crop. It integrates well into environmentally friendly crop rotations, benefiting subsequent crops like maize.Weaknesses Tobacco consumption poses real risks to health, illicit tobacco trade Inability to totally eliminate non target group Child Labour in Tobacco Growing black market driven by ever higher taxes, Weak criminal penalties, poor compose controls, low arrest rates Non-Compliance Strategy e.g. selling in unlicensed establishmentOpportunities Delivering innovations and refinements to our products across leaf blends, finer cut tobacco, wise filters, new formats such as slimmer products and improved tastes in segments such as menthol. Able to innovate constantly Over 100 countries grow tobacco Largest leaf supply range of mountains having no match in the industry of tobacco This industry is possessed with the ability to rescuing itself for a long termThreats Price competition in tobacco industry can be fierce. the presence of many brand s products in the marketplace the open-source license regime means anyone can re-brand and redistribute under new name Laws governing tobacco brand advertising and company restrictions Counterfeiting Smoking and health litigation (third party reimbursement, class action, individual action)The success of marketing exertion should be monitored.General criticismsTobacco use has been found to be harmful and addictive product that has huge health and economic impact for the users and passive users. It was found to be a single most preventable cause of morbidity and mortality in most developed nations and addiction is one of the greatest threats liner young people (British Columbia Ministry of Health Services, 2003)Tobacco use has huge economic, social and environmental consequences. Some of which are highlighted in the table belowDirect HealthSocial economicEnvironmentalDisabilityReduced productivityFire damagePremature deathWorker absenteeismLiters from cigarette butsLost income due to premature deathdirect health care costsStudies also found a link between advertising and promotions and encouraging adolescents to initiate smoking, and that point-of-sale advertising influences youths intentions to smoke in the future (Chaloupka et al, 2007).RECOMMENDATION AND CONCLUSSIONSeveral studies have found tobacco product to be harmful to health with enormous economic and incalculable social impact. Reducing its use has also been found to improved general health and wellness. Government has always been torn between forfeiting a large sum derived from Tobacco industry through tax and job creation, and listening to the voice of experts who are determine to see that tobacco usage is banned.Tobacco companies all over the world use all sort of tactics, including lobbying, campaigns aim at health improvement, looking for consort to ensure they have a free market.It is set in this report that Tobacco industries will use any means of publicity to reach their target group increasing global share value (profit) and tax are key strategic elements defining battlefield for the industry Costs and impacts of smoking are misinterpreted, and Tobacco companies will always found allies in stakeholders (Ross 2008))This report suggests that any form of advertisement or promotion that has a large percentage of spilling over to non target group should be curb e.g. point-of-sale advertisement.Authorities should put more effort in helping people to quit and protect passive smokers. There should be a lighten up definition of where smoking is allowed or not, it is not uncommon to see smokers smoking at bus stop or on the street.More research needs to be done on the effect of Nicotine, main component of tobacco products.Where products are found to be extremely harmful, companies should be mandated to withdraw such products.