INTERNATIONAL MARKETING
Marlboro Global Marketing Strategy
Surgeon Generals Warning: Smoking kills.
20 CLASS A CIGARETTES
Purpose of this presentation: To provide a deeper understanding of Philip Morris strategic efforts behind building Marlboro into a successful global brand by highlighting key strategic decisions from the past as well as characteristics of the current global brand strategy.
AGENDA
1. 2. 3. 4. 5.
Introduction Short Brand History Marlboro Goes Global Current Brand Strategy Global Marketing Mix Product Promotion Price Place 6. Conclusions
INTRODUCTION
worlds best-selling cigarette brand (300 bill. units sold in 180 countries) worlds most profitable non-durable consumer good flagship brand of Philip Morris, the worlds largest cigarette manufacturer
INTRODUCTION
18th Most Valuable Brand in the World (Interbrand ranking 2011, net value: 20 bill. $) most recognized and appealling brand image of the 20th century: Marlboro Man and Marlboro Country Marlboro Man symbol of the true American spirit and American way of life unprecedented success marketing tool with
SHORT BRAND HISTORY
introduced in the 1920s in the U.S. by Philip Morris, named after Maroborough Street in London different positioning before and after World War II 1955 Leo Burnett repositions the brand to appeal to both male and female smokers The Tattooed Man image campaign, later The Marlboro Cowboy 1963 extension with The Marlboro Country theme
SHORT BRAND HISTORY
Marlboro in the 1920s and 1950s
SHORT BRAND HISTORY
Marlboro after the 1950s
SHORT BRAND HISTORY
next decades global expansion and positioning as a global brand reasons
by 1972 no. 1 tobacco brand in the world 1993 Marlboro Friday 1996 first tobacco product in the Marketing Hall of Fame, together with Coca-Cola, Walt Disney, Nike, etc.
MARLBORO GOES GLOBAL
global expansion: a mixture of organic growth, geographical expansion and acquisitions 1950s first sales organizations and production facilites outside the U.S., 1955 Philip Morris Overseas today: production sites in 56 countries, sales subsidiaries in 150 countries, sales in 180 countries licensing agreements, joint ventures with local producers, privitazation of state-owned tobacco factories
MARLBORO GOES GLOBAL
core strategic concept: to sell a marketable version of the American West or the American Dream to consumers worldwide find a global target segment and approach it through a standardized marketing and advertising approach: export of the Marlboro Man and Marlboro Country theme highly successful approach but not in every market Hong Kong example of
MARLBORO GOES GLOBAL
Several decisive success factors: PMIs position as a strong U.S. corporation increased global popularity of Western movies effective global market research efforts to identify a global consumer group with similar values and attributes Marlboro as part of the global mass culture
CURRENT GLOBAL STRATEGY
Specific tobacco industry characteristics: high homogeneity of products, differentiation only through branding and marketing high concentration with 5 major players: PMI, BAT, JTI, IT, RJ Reynolds many restrictions and regulations, public awareness
CURRENT GLOBAL STRATEGY
target: global community of young adult smokers USP: high-quality American style cigarettes focus: growth segments of each market and new opportunities for growth advantages: strong global brand image and high recognition despite restrictions on advertising
CURRENT GLOBAL STRATEGY
a superior, highly diversified product line a commitment to quality the use of global media channels and global events reasonable and affordable pricing constant product innovation an aggressive distribution strategy corporate social responsibility
CURRENT GLOBAL STRATEGY
Marlboro has a tradition of being the industrys innovator examples: the flip-top box, cork looking filters, slow burning paper, slide packs, etc. Filter Plus Technology: a revolutionary, flavor enhancing, four-chamber filter system
MARKETING MIX: PRODUCT
high degree of standardization with carefully selected adaptations to local preferences positioned worldwide as a high quality product in the premium segment 2008 launch of the new Marlboro Brand Architecture to broaden the target market
NEW BRAND ARCHITECTURE
Flavor Line
Gold Line Fresh Line
MARKETING MIX: PRODUCT
Brand Architecture
packaging upgrades (Marlboro Red Filter Plus Slide Pack) and many line extensions for individual markets quality improvements appealling and sophisticated design promotional function of packaging new menthol products (Crisp, Fresh and Ice Mint, mainly for the Asian market) and kretek or clover cigarettes
Product Innovations
Filter Plus Technology Marlboro Intense (shorter, rich-flavored cigarette)
MARKETING MIX: PROMOTION
predominantly standardized with some local adaptations, strict ethical code shift from traditional channels to alternative ones due to restrictions on tobacco advertising use of global media channels: Internet sponsorship of global events: Formula 1 Ferrari Team, Ducati Motor Racing Team
MARKETING MIX: PROMOTION
switch-selling and buy one, get one for free activities performed by local sales force online promition: discounts, coupons, birthday gifts, concert tickets, competitions with prizes for registered members Marlboro Club: uniting smokers who love Marlboro cigarettes, maintain brand loyalty
MARKETING MIX: PRICE
highly adapted , due to different taxation, income levels and competitive situations, positioned as a premium brand in the upper price segments across all markets however, affordable pricing strategy to attract smokers sell-low strategy high disparities (6$ in U.S. versus 79 critique
cents in Senegal for Marlboro Red)
due to large market share, Marlboro can set prices of the industry (1993 worldwide price-cut to protect market share)
MARKETING MIX: PLACEMENT
highly adapted to local conditions , due to differently restricted access to distribution channels across markets example: U.S. supermarkets, convenience stores, gas stations, discount stores versus Austria only in tobacco shops common characteristic: maximum distribution coverage and top shelf space to emphasize brand superiority effective sales force, takes advantage of large market share, builds strong relationships with retailers
CONCLUSIONS
Marlboros exceptional success as a global brand is the result of: a carefully planned and implemented global expansion strategy effective market research to identify a global consumer segment a strong brand image to appeal to this global consumer group (Marlboro Man) an optimal mix between standardization and adaptation across markets past challenges like: health warning labels, marketing constraints, public scandals, legal lawsuits, etc. were mastered successfully
CONCLUSIONS
rapidly changing tobacco industry environment many future challenges like: increased taxes on cigarette sales, introduction of plain packaging, ban on various ingredients, product display bans in retail stores Marlboro and Philip Morris need to find new and innovative ways to address these challenges and maintain global market leadership
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