Project on Brand Management of Marlboro

By,

PBM (Grp : 2)

Sutapta Mukherjee

Amita Makkar

Diksha Chauhan

SubhaLaxmi Sahoo
Marlboro

Marlboro is the largest selling brand of cigarette in the world. It is a product of Philip Morris. Pjilip
Morris launched the Marlboro brand in 1924 as a woman’s cigarette, based on the slogan “Mild As
May”. In the 1920’s , advertising for the cigarette was primarily based around how lady like the cigarette
was. To this end, the filter had a printed red band around it to hide lipstick stains, calling it “Beauty Tips
to keep the paper from your Lips

Marlboro Menthol Light ( used in the U.S. until June 2010). After scientists published a major study
linking smoking to lung cancer in the 1950’s, Phillip Morris repositioned Marlboro as a men’s cigarette in
order to fit a market niche of men who were converned about lung cancer, but not wanting to admit it.
At the first time fliterd cigarettes were considerd about lung cancer, but used to be marketed to women.

The repositioning of Marlboro as a men’s cigarette was handeled by Chicago advertiser Leo Burnett. The
Proposed campaign was to present a lineup of manly figures i.e. sea captains, weightlifters, war
correspindents, construction workers, etc. The cowboy was the first in this series. While Philip Morries
was converned about the campaign , they eventually green ligheted the campaign.

Within a year, Marlboro’s market share rose from less than one percent to the fourth best selling brand.
This convinced Philip Morris to drop the lineup of manly figures and stick with the cowboy imagery.

In order to comply with new regulations prescribed by the United States Food Drug Administration,
Phillip Morris rebranded Marlboro products marketed in the US as “Lights” , “Ultra-Lights”, “Medium”,
“Mild”, or any similar designation that yields an impression that some tobacco products are
comparatively safe.
Marlboro was named after “Marlborough Street” of London. Today Marlboro has more than 70
variants and is valued over $21 billion. It is considered as one of the most premium brands in the
smoking community.

Camel is considered one of the heaviest competitors to Marlboro.

KEY INDUSTRY STATISTICS – 2009 FIGURES

Industry Revenue 1,542.9 $Mil

Revenue Growth 0.8 %

Industry Gross Product 746.9 $Mil

Number of Establishments 7,906 units

Number of Enterprises 6,759  units

Category Size - Declining industry, Languishing Demand & Health concerns

Category Growth - Death toll from tobacco estimated to reach 10M annually

Sales Cyclicity - Not directly impacted by GDP variations

Seasonality - Weather Condition, Timing of quitting efforts (e.g. new year resolutions)

Profit Level - High Competition & Declining margins = Lowering profits

Threat of New Entrants - Difficult to enter, distribution problem

Distribution -Very critical, difficult to emulate, High Costs

Capital Requirements - High Distribution costs, Differentiation through branding, flavor &
packaging

Bargaining power of buyers - High, Lot of competitors with similar options

Bargaining power of suppliers - Low

Pressure From substitutes -High availability of substitutes @ similar price

Current category rivalry -Very High, Differentiation largely by branding, distribution

Marlboro is in the Maturity level in the product life cycle, and is considered as a cash cow for Philip
Morris.

MARLBORO

Technological - Important to develop manufacturing facilities

Economic - Can fair the Economic recession

Political - Strict rules & regulations related to advertising, age etc

Social - Acceptance decreasing, cognitive dissonance, negative association

FACTORS ATTRACTIVENESS

Category Size -

Category Growth -

Sales Cyclicity +

Seasonality +
Profit Level -

Threat of New Entrants +

Distribution -

Capital Requirements -

Bargaining power of buyers -

Bargaining power of suppliers -

Pressure From substitutes -

Current category rivalry -

Technological +

Economic +

Political -

Social -

Points of Differentiation:

Brand Imagery and attitude - Rugged, Macho and Independent.

Packing and Logo - High in recalling due to the red colour.

Distinctive Flavor - Nicotine levels are constant, Strong in taste and superior quality.

Points of Parity:

Powerful physical effect as compared to other local cigarettes

Reducing Brand appeal due to ban on cigarette advertising.

Understanding the Marlboro Customers:

Geographic – Region : Worldwide.

Demographic :
 Age – Young adult smoker, 18 +.

Income – Upper middle class.

Gender – Males (Primary target) & Females (Secondary target).

Occupation – Professional, employee, Adult students, self employeed.

Psychographic:

Lifestyles - Adventurous people, Freedom

seeking , Non-conformist, Independent spirit

Behavioral

Benefits - Frees a person & as a personal choice

Brand loyalty – High, Less price sensitive

Marketing Mix:

PRICE
Product:

• Strong taste

• Smooth + Distinct Flavour

• High Quality

• Wide variety

• Attractive Packaging

Place:

• Retailers

• High End Bars, Pubs & Hotels

• Convenience Stores

• Fuel Pumps

• Widely available

Price:

• Premium Pricing strategy

Promotion:

• Mail Coupon Promotions

• In-store advertisement

• Temporary price cuts

• Annual sweepstakes to smokers

• Promotional offers on carton of 10

• Advertising has reduced due to ban on smoking ads

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Comprehensiv
e Market
Share - Retail
share in USA
for 2009.
Sales From
internet &
direct
channels are
not included
Brand Health on Powergrid:

Unfocused

Free Brand Association:

Experiential
Strong tobacco taste, Smooth
CBBE Pyramid (customer based brand equity):
Leveraging Secondary Association:

EVENT MERCHANDISE - CO-BRANDING

Brand Extention:

Focus on adventure, masculinity, risk

taking & non conformism

US Varieties:

 Marlboro Red Pack

 Marlboro Red Label
 Marlboro Gold Pack (Light)
 Marlboro Silver Pack (Ultra Light)
 Marlboro Blend No. 27
 Marlboro Virginia Blend
 Marlboro Special Blend Red
 Marlboro Special Blend Gold
 Marlboro Menthol
 Marlboro Menthol Blue Pack (Mild)
 Marlboro Menthol Gold Pack (Light)
 Marlboro Menthol Silver Pack (Ultra Light)
 Marlboro Menthol Blend No. 54
  Marlboro Menthol Smooth

Non US Varieties

 Marlboro Black
 Marlboro Black One
 Marlboro Black Menthol
 Marlboro Blend No. 9
 Marlboro Bright Leaf (UK)
 Rooftop Red (Canadian Marlboro Filter)
 Rooftop Gold (Canadian Marlboro Light)
 Rooftop Silver (Canadian Marlboro Extra Light)
 Marlboro Cold Mint (Spain)
 Marlboro Compact (Europe) - slightly shorter than standard cigarettes
 Marlboro Crisp Mint
 Marlboro Filter Plus (Russia and Bulgaria)
 Marlboro Filter Plus One (Russia)
 Marlboro Flavor Mix (Egypt)
 Marlboro Flavor Note (Germany)
 Marlboro Flavor Plus
 Marlboro Fresh (Sweden)
 Marlboro Fresh Mint
 Marlboro Frost
 Marlboro Gold (in countries where "light" isn't allowed)
 Marlboro Gold Advance
 Marlboro Gold Edge
 Marlboro Gold Touch (Europe) - slightly thinner
 Marlboro Ice Mint
 Marlboro Ice Blast (Singapore and Japan)
 Marlboro Ice Chill (Australia)
 Marlboro Ice Fresh (Brunei)
 Marlboro Kretex/Mix 9 (Indonesia)
 Marlboro MX4 Flavor (Europe)
 Marlboro Medium (Jordan)
 Marlboro Night Fusion
 Marlboro Wides (Europe, Japan)
 Marlboro Touch

Indian Varieties:
  Marlboro Red

 Marlboro Lights

 Marlboro Gold Advance

 Marlboro Menthol

 Marlboro Clove

Brand Matrix

BRANDS

Perceptual Mapping:
 Health

Maslow’s hierarchy of needs:

Print Ads:

1971

Cigarette Smoking is injurious to health