International Business

Report on British American Tobacco Bangladesh Co. Limited (Part-1)

Report on British American Tobacco Bangladesh Co. Limited (Part-1)

1.1  Background

Low segment is the most critical segment for BATB for its volume leadership in the industry. Recent trend indicates the segment is growing faster than any other segment and attracting highest number of new entrants and up-traders. The segment is expected to grow and become the most influencing segment in the industry over mid term.

“STAR” is the drive brand in this segment. In recent years, the brand has grown substantially and became the biggest brand of BATB. However, “NAVY” is also has grown and in some markets grown faster than “STAR”. Right now “NAVY” is slightly ahead of “STAR” in terms of off-take share. To maintain BATB’s leadership it is absolutely critical to overtake “NAVY” and establish “STAR” as the leading brand of the low segment. The hidden truth behind this strategy is that BATB wants to establish “STAR” as the leading brand in this low segment because it does not want “NAVY” to get strong base and to endorse Castle in the mid segment where John Player Gold Leaf (JPGL) and Pall Mall are the main profitable brands for BATB.

In light of the above facts, “STAR”‘s superiority over “NAVY” needs to be clearly established in each segment of trade “STAR”ting from the retailers to the ultimate consumers. Project Seedbed is a bold step towards that direction. Project Seedbed was first proposed to the Marketing Top-Team Meeting (MTM) and then to the Executive Committee Meeting (ExCoM) in December 2004 as a regional initiative by Khulna Region. This Campaign is expected to clearly establish “STAR”‘s product positioning and provide smokers reasons to rationalize “STAR”‘s superiority over competition. Just to update, overall product superiority of “STAR” has been confirmed during the last MASQ, where “STAR” was rated over “NAVY” in terms of product performance.

The purpose of the study is to successfully identify the key marketing deficiencies of “STAR” in Khulna and propose some appropriate and market specific strategic solutions to establish “STAR”’s superiority over its competitive brands.

1.2 Origin of the Report

This report is prepared to fulfill the partial requirement of my Project of BBA Program of East West University, supervised by Omar Faruq, Assistant Professor. I have been working for this project since June 2009.

1.3 Objectives

The objectives of the study are as follows:

  •   Evaluate the form and status of competition in the segment.
  •   Identify the key marketing deficiencies of “STAR” as a brand in Tk. 1 segment against its largest competitor “NAVY” on the basis of consumer disposition funnel.
  •  Recommend some appropriate and market specific solutions to minimize the gap.
  •   Design a detail pilot project for implementation of the recommendations.

1.4 Scope

1.4.1 Brand Scope

There are several Tk. 1 segment brands in the market. BATB has two strong brands in the segment – “STAR” and Scissor. In the same way, DTI holds another strong brand – “NAVY”. As a requirement of the organization, the study limits its focus only on two brands – “STAR” and its largest competitor “NAVY”. Also “STAR” sees an organic growth in few important territories and also its brand image creates its demand.

1.4.2 Demand Factors

While analyzing, factors like volume swapping, external market influences on demand condition, seasonality and several other inevitable incidents are kept aside to rest the focus on the purpose.

1.4.3 Market

As an organizational requirement, the study needed to be focused on Khulna market. Therefore, the data presented here are from the same market and can vary significantly from the rest of Bangladesh due to state of competition, economic condition and many other influencing factors.

The Khulna Region consists of 21 different markets, divided into 4 areas. Therefore, the question naturally comes, what are the reasons behind selecting Khulna for the study and the pilot run? Broadly, what is the significance of this particular market?

To answer the question, we need to look deeper into individual market characteristics. If we summarize the market characteristics in terms of competition, geographical importance, volume and growth potential, Kushtia, Chuadanga, Jessore, Khulna, Faridpur, Madaripur, Barisal, Jhalokati, Potuakhali, Borguna and Gopalgonj are some of the top priority markets for Khulna Region. They provide a business of more than 60 percent of the total market volume of the region and holds great potentiality for future growth. Among these markets, Khulna, Jessore, Kushtia and Barisal are the hearts of the regional business.

From the results of prior a market research, it has been identified that the market characteristics of these four markets are identical with some minor dissimilarity. They hold similar type of geographical dispersion, importance, growth potential and trend. Apart from these huge similarities, only Kushtia holds some extra advantages, like better economic condition of the consumers, strong brand position of “STAR” among Tk. 1 brands. So, if any particular strategy works for one of these markets, we can safely infer that it will have similar or better impact in other markets, if implemented. Additionally we will also have the advantage of having some concrete ideas about the result and impact in the market

So, the region decided to these four markets into three categories:

  •   Seedbed: Jessore and Khulna
  •   Green Belt: Kushtia
  •   Time Shop:Barisal


The general modality that will be followed is to design a detail work plan and implement able pilot project and run it into Khulna. As the competition is fierce in Khulna, so any plan which can show moderate results in Khulna can bring significant impact for other markets with less competition. For example, as the competition is not so significant in Kushtia, it is believed to bring significant impact in that market. To ensure optimum use of resources, if needed, some of the activities of the project will be rearranged and cut short to ensure resource optimization.

Green Belt

A project with similar objective, but different modality is being run in Kushtia. It is believed that the results of the project will provide further insights of the market and will strengthened the seedbed for better performance upon implementation.

Time Shop

Scissor is a strong brand in Barisal. So, time will be bought from Barisal and after the successful completion of Project Seedbed in Khulna, activities for Barisal will be decided based upon the findings and results of the pilot run.

1.5 Methodology

1.5.1 Research Method

This research includes a consumer survey module to identify the key deficiencies in case of “STAR”. One thing that needs to be mentioned here is that, the survey module were already designed and the modality were already prepared and accepted by the team. There was not much scope to customize or rearrange the survey methodology. Therefore, the applicability issue does not come under the scope of the study.

Also, secondary data sources such as sales report and other materials were used as necessary. Fragmented retailer interviewing were done in several cases to get a comprehensive view.

Sampling Plan

The survey conducted for the study is done considering the effect of different stages in the market. Major clusters in Khulna were identified based upon differentiating characteristics and then proportional sample size was determined to represent the whole market.

Data Collection

The survey routine was divided into seven areas. The main objective of the survey was to find out the position of the consumer in the disposition funnel for both “STAR” and “NAVY”. The areas of data collection were:

  •   Introductory Part
  •   Top of the Mind (TOM) Awareness Level
  •   Consideration Level
  •   Trial Level
  •   Repertoire Level
  •   Regularity Level
  •   Loyal Level

A common datasheet form, designed by the BATB survey management team to distinguish consumer loyalty and some other relevant attributes were used for the survey. The form helps the surveyor to find definite clue about the consumer’s level of attachment with “STAR” as well as “NAVY”. After the Introductory Part, each question judges the consumer to find out in which level the consumer is in currently now. It “STAR”ts from Awareness Level and ends in the Loyal Level.

1.5.2 Method of Analysis

The collected data from the survey were extracted from the datasheets and put into a flow-table to analyze the chronicle changes in the disposition funnel. The data taken for “NAVY” was used as the benchmark. From there, it is possible to successfully identify the major deficiency areas and have an outline for recommendations and further decision making.

1.6 Limitations

Despite of the effort to make the study as proximate to perfection, there are several unavoidable reasons, which might contribute for its limitations.

  •   There were several organization bindings and requirements those I needed to consider while conducting the study.
  •   There are several data and formats, which are highly classified and contain sensitive information. While, attaching them with this report would definitely provide the reader with a broader view on the rationale of the study and the findings, but it was not possible.
  •   In many ways, the geographical dispersion of the clusters hindered the study and in certain cases prevented from going for deeper insights.
  •   Definitely, there might be some judgmental errors occurred due to inexperience and surroundings.

1.7 Contribution to the Study

The study is believed to contribute significantly in minimizing the gap between “NAVY” and “STAR” in terms of consumer perception, brand position and ultimately sales. While gaining leadership over a strong brand such as “NAVY” is a long-term process and cannot be done in one night, but the study will definitely help to identify the major lacking and help to take future decisions.

The recommendations from the findings will definitely help in making future decisions and will also contribute by presenting some real life data from its pilot run.

1.8 Scope for Further Research

Obviously, there are many factors, which are outside of the scope of the study but will definitely have some impact over the market and the competition. Therefore, there is scope to include as many of those factors as possible and consider their effect in the study and observe the result. This will make the findings more comprehensive and will help to minimize uncertainty, which are critical for decision-making. Also there are some factors that can not be anticipated. But many factors also can be overlooked. So factors that have impact will make the research accurate if these are included.

2.1 British American Tobacco Bangladesh Company Ltd.

British American Tobacco Bangladesh is a member of the British American Tobacco Group that is based in UK and one of the leading players in the global tobacco business.  With a long established reputation for providing its consumers with consistently high quality brands, British American Tobacco Group was formed at the turn of the 20th century with the objective of establishing a worldwide business. British American Tobacco is World’s most global tobacco company. BAT has 85,000 employees selling more than 300 brands in more than 180 markets worldwide. Today, the company produces some 2 billion cigarettes every day. More than a billion people across the globe enjoy smoking tobacco. One in every eight chooses a British American Tobacco brand.

In order to support the company’s business goals, the merger of British American Tobacco with Rothmans International had been announced on 11 January 1999. This global merger was completed on 7th June 1999. This brings together the number 2 and 4 players which together will boast a combined volume exceeding 900 billion cigarettes around the world with some 120,000 employees and a world-wide market share of 16 percent (Phillip Morris has a 17 percent share). The merger is a major step forward in British American Tobacco’s vision of becoming the world’s leading International Tobacco Company.

British American Tobacco Bangladesh Company Limited, a market leader in the country, is a subsidiary of British American Tobacco PLC and is one of the 66 countries in which the British American Tobacco Group has manufacturing plants. British American Tobacco Bangladesh has operated in Bangladesh since pre-independence and has it’s headquarter in Dhaka, with a tobacco leaf processing operation in Kushtia. It is one of the oldest, largest and most respected multinational companies operating in Bangladesh.

BATB markets major international cigarette brands like Benson & Hedges, State Express 555, John Player Gold Leaf and Pall Mall, which are complemented by local brands such as Capstan, “STAR” and Scissors. The company also exports processed tobacco leaf in the international market, mainly in the European Countries with its effort to create an international market of its products.

British American Tobacco Bangladesh currently employs more than 1,300 people and provides indirect employment to a further 24,500 farmers, distributors and suppliers.

Currently, British American Tobacco Bangladesh has two factories in Bangladesh. The Cigarette Manufacturing Factory (Dhaka Factory) is located on the same premises as the Head Office in Mohakhali, Dhaka. The Green Leaf Threshing Plant (GLTP) is situated in Kushtia.

In line with the global identity change of British American Tobacco PLC, BTC was renamed as British American Tobacco Bangladesh Company Limited (BATB) in 1998.  The Company is listed on both the Dhaka and Chittagong stock exchanges in the country.

2.2 The Vision and Mission of BATB

The vision of the organization is:

To Extend Our Leadership through World-Class Performance

There are certain missions the organization is heading to accomplish. They are:

  •   Double the net revenue by 2006
  •   Growing our share of the total tobacco market
  •   Dominating key identified segments

2.3 Historical Background of BATB

The journey of this company “STAR”ted long back. BATB was established back in 1910 as Imperial Tobacco Company Ltd. with head office in Calcutta. In the very beginning, Imperial Tobacco Company (ITC) launched a branch office at Moulivibazar, Dhaka in 1926. Cigarettes were made in Carreras Ltd., Calcutta. Imperial and Carreras merged into a single company in 1943. After the partition in 1947, cigarettes were coming freely from Calcutta, but introduction of customs barriers in 1948 between India and Pakistan interrupted the smooth flow of cigarettes from Calcutta to East Pakistan.

In March 1, 1949, Pakistan Tobacco Company (PTC) came into existence with head office in Karachi; with the assets and liabilities of ITC Limited held in Pakistan. The then East Pakistan Office was situated in AlicoBuilding, Motijheel. In order to meet the increasing demand, the first factory in the then East Pakistan was established in Chittagong in 1952. From this time, onwards requirements for cigarettes for East Pakistan markets were met from products manufactured in Karachi. In 1954, PTC established its first cigarette factory although high-grade cigarettes still came from West Pakistan. The Dhaka factory of PTC went into production in 1965. After the war between India and Pakistan in 1965; the import of tender leaf from India for the production of Biri was stopped. This gave a big boost to cigarette business. It was at that time the East Pakistani entrepreneurs set up 16 cigarette factories in this region.

After independence, Bangladesh Tobacco Company (Pvt.) Limited was formed on 02 February 1972 under the Companies Act 1913, with the assets and liabilities of PTC. Shareholding position for GOB and BAT was 1:2. BTC (Pvt.) was converted into a public limited company on 03 September 1973. British American Tobacco played a pivotal role in BTC’s creation in 1972 and since then has been involved in BTC’s development every step of the way. To pronounce the successful relationship with British American Tobacco, BTC has changed its name and identity to British American Tobacco (BAT) Bangladesh Company Limited on March 22, 1998. The company changed its identification to establish commitment to the highest international standards.

2.4 Relationship between BAT & BATB

The parent company of BATB is called BATCO or British American Tobacco Company. They are the major shareholders of BATB. The operations of BATB are regulated according to BATCO regulations and BATCO looks after the management aspects of BATB. BATB management is trained by BATCO and in many occasions. BATCO sends over their own management to work in BATB. BAT industries are widely known as BATCO and has two major divisions:

  •   Tobacco Division
  •   Financial Division

The following organ gram shows the relationship between BATCO and BATB very clearly:

Currently British American Tobacco Bangladesh is retaining 63% of the cigarette market in Bangladesh. British American Tobacco Bangladesh is a sister concern of British American Tobacco Company (BATCO). The cigarette division is known as British American Tobacco Holdings (BAT Holdings), which operates in more than 78 countries. BAT Holdings is a sister concern of BAT industries – a London based world famous business house. BAT industries operate in financial services, paper manufacturing, and tobacco sector. BATCO divided its cigarette operation in five regions. They are:

  •   North and Central America
  •   Europe
  •   South America
  •   Asia Pacific
  •   AMESCA

BATB actually maintains a relationship with BATCO through AMESCA. It is actually a region of BATCO to which BATB reports. AMESCA is made up of: A = Africa, ME = Middle East, S= Subcontinent, CA = Central Asia.

2.5 Structure of BATB

BATB is a public limited company. Management Director is the operational head and appointed by the British American Tobacco. Head of every department carries out their functions with the help of line managers. Different departments have different structure according to their function and responsibility.

The Board of Directors and Executive Committee (ExCo) govern the overall activities of the company. The Board of Directors is composed of 10 members who are called Directors. The Chairman heads the Board of Directors. Chief Executive of British American Tobacco Bangladesh is called the Managing Director, who is normally appointed by BAT Holdings. Managing Director of the company is the chairperson of the Executive Committee. This committee includes the head of all the functional departments.

2.6 Ownership Status of the Company

British American Tobacco Bangladesh is listed in the Dhaka Stock Exchange (DSE). It has an authorized capital of Tk. 400,000,000 of 40,000,000 ordinary shares of Tk. 10 each. British American Tobacco Bangladesh, which encompasses 62% of the shares of the British American Tobacco, London. The Government held 32% of its shares. Subsequently the government has gradually sold its holdings to different organizations of the country. The composition of shareholders on December 31, 1999 was:

2.7 Employee and Trade Union of BATB

The employees of the BATB are dynamic, self-motivated and energetic to perform any assigned job, because they are selected based on excellent academic and experience records. The company employs 1,244 permanent employees and varying number of seasonal and temporary workers as required. Each permanent employee receives remuneration in excess of Tk. 36,000 per annum. Remuneration depends on the nature and conditions of work. The workers are labeled in the following categories:

  •   Permanent
  •   Probationer
  •   Temporary (seasonal)
  •   Badli
  •   Casual

Trade union is established in the following company’s working locations:

  •   Head Office and Dhaka Factory
  •   Chittagong Factory
  •   Rangpur Leaf Factory

There is a positive relationship between the company and the trade union based on mutual trust and respect. All the employees of the company belong to the trade union. When a worker becomes a member of the union, according to his request a certain amount of his wage is deducted as the union subscription fees on a check off system. Trade union election is held after every two years and governed by their respective constitutions. The terms and conditions of services of the employee are negotiated and determined through a process of collective bargaining between the company and the union.

2.8 Physical Infrastructure of the Company

The infrastructure of the company has a broader field where the company plays its important role. BATB has six Regional Trade Marketing Offices (RTMOs), 12 Regional Sales Depots, 1 Factory, 1 Green Leaf Threshing Plant, 7 Leaf Depots and a Head office consisting of Corporate Head Office and Production Head Office. The Company’s Head office and Cigarette factory are located in Dhaka. A Green Leaf Threshing (GLT) Plant has been set up in Kushtia and it has “STAR”ted operation from April 1995.

The company’s products are manufactured in the factory at Mohakhali, Dhaka. The Plant Manager who reports to the Production Director at the Head Office heads Dhaka factory. The company’ procures tobacco leaf maintaining the international standard and it imports processed tobacco leaf for its international brands. It procures green tobacco from the registered farmers of the leaf area mainly for its local brands.

The company’s authorized leaf areas are located in Kushtia, Chittagong and Manikgonj. However, bulk of tobacco leafs comes from Kushtia region. The Chittagong area is under development process and it now covers Rangunia and Lama. The company operates seven leaf depots in the leaf area. Four of them are located in Kushtia region, two of them are located in CDA and other one is in Manikgonj, The Company provides all sorts of supports to the registered growers through its depot personnel. This includes technical know how, agricultural inputs and financial assistance.

The company performs its sales and distribution operation all over the country through its six regional sales offices. They are located in Dhaka, Khulna, Chittagong, Sylhet, Bogra and Mymensingh. Each of the regions is again divided into operational areas, each of which in turn is divided into territories. To perform its sales and distribution smoothly, the company operates 10 sales depots in different locations of the country and it has 63 authorized distributors.

2.9 Tobacco Cultivation in Kushtia

Tobacco cultivation in Kushtia Leaf area was first introduced in 1967 with an area of 10 acres. It was expected to expand to 650 acres by 1971. Flue-cured and Air-cured tobacco were cultivated in Kushtia and the Leaf Department achieved self-sufficiency in cigarette tobacco by 1975. Tobacco cultivation though registered growers and procurement of the product tobacco is done through four leaf depots In Kushtia. Those depots are Meherpur, Jhenidah, Chechua and Allardarga Leaf Depot. Kushtia Leaf Factory stands on 4.31 acres of land and is located at about three kilometers away from main town. The Green Leaf Threshing (GLT) plant could complete the entire leaf purchase in 1995. A team of management including the Plant Engineer, Processing Manager, Shift Manager, Quality Control Manager, Leaf Account and the Leaf Personal Manager is managing the GLT plant. The Plant Manager is the team leader of GLT management team.

2.10 Environmental, Health & Safety Policy and Afforestation Program

All the activities in the manufacturing unit and Green Leaf Threshing Plant ensure that work is conducted in a manner to minimize environmental pollution. GLT has won British American Tobacco’s Environment, Health and Safety Merit award for the year 1995 and 1996 for achieving consecutive two years of operation with zero accident. The company also received the prestigious EHS Silver Award for 1999 without any lost time due to accident in any part of the company, which was the second year in a row.

In line with BAT’s environmental, health, and safety policy, the company is involved in an afforestation program. The contribution of the company in afforestation program in Bangladesh has earned recognition in the country though winning of the Prime Minister’s Trophy in 1993. In 1998, the company distributed 3.5 million free saplings in Dhaka through the Bonsai Nursery project. This program had caused more than 28.5 million trees planted or distributed till 1998 and is expected to yield around 120,000 metric tons of timber for fuel-wood, furniture making, or construction process in 1998 . The Food and Agricultural Organization (FAO) has awarded British American Tobacco Bangladesh for pioneering the development of vegetable seed industry in Bangladesh. The company had “STAR”ted its vegetable seed multiplication program in 1990 with the technical support of FAO with a view to provide quality vegetable saplings for free distribution amongst farmers in the tobacco growing areas.

It is not enough for BATB only to contribute to the afforestation of the country. The company felt the need to promote the use of alternate wood fuel for tobacco curing by its farmers. Briquette as an alternate was introduced to the farmers to reduce their dependency on trees for wood fuels. Briquettes are made of paddy husk and sugarcane biogases. Briquettes can be used for cooking, in burns for curing tobacco and brick. The company promotes Briquette manufacturing in the tobacco growing areas and tries to make them easily available to the farmers.

A company wide safety awareness program was initiated and completed in 1996. The objective of this program was to brief employees about the techniques to reduce the risk of occurrence of preventable accidents. The company’s commitment to the highest level of safety practices are recognized with awards being received from the British American Tobacco Group headquarters in more than one year. Workers and management are provided with regular safety training. Hard hats are required during shift work. All movable machine parts have guards to prevent workers from accidental injury.

2.11 Commitment to Develop the Future

British American Tobacco has over the decades consistently invested in the Bangladesh market through BATB. Thus BATB has always been in the business of manufacturing and marketing brands that meet standards found anywhere in the world.

The company believes in attracting the best talent available by offering a challenging working environment with international career development opportunities. Individuals here are entrusted with significant responsibility and autonomy, and investment in people through regular training and career development has helped them to establish a culture, which encourages people to think creatively, generate new ideas and approach problems from a number of different perspectives. In the quest of becoming a World Class Company by achieving the visions, strategic imperatives and the values, the company has launched a change management program called – Winning in Our World in 1999. The objective is to bring about a cultural change by embedding the WOW Values and removal of barriers. To this effect, the company has organized different workshops, employee care and development activities throughout the year with direct participation of its people.

With state-of-the-art machinery, excellent people, and a portfolio of world-beating brands, British American Tobacco Bangladesh could not be anything but instinctively international.

People’s attitudes have changed much over the time. Without this changed attitude of excelling in their performance, it would not have been possible to make so much progress. This spirit of people will help in achieving the company’s Vision and Mission and ultimately to be a world class company.

Lotus notes is a highly evolved advanced communication system of BAT through which all the employees of BAT worldwide communicate among themselves. This hi-tech device helps to provide quick and uninterrupted communication and information. Quantum is a marketing information tool with the objective of effective utilization of marketing spends through better targeting and evaluation of BATB’s marketing activities. This strategic investment helps BAT to achieve competitive edge in case of facing any competition. The company has implemented Tetra CS/3, a totally integrated software package that links Manufacturing, Finance, and Distribution providing one set of clearly understood information that can be used throughout the company. Apart from this software, the company uses several other software packages for some specific purposes that are shared throughout the company.

Another important development with regard to accessibility of information is the implementation of the Global Enterprise Network (GEN) standard. GEN provides a standardized IT infrastructure throughout the British American Tobacco group that allows users to access their work areas from any location within the group.

Also the company has developed a system to have better control of its supply chain process. This has made a major impact in terms of automating the entire supply chain process from shipping go-down to retailer, providing on-line information at every stage of the secondary supply chain.

As a company that aspires to be the world class, the company also looks at the interests of its suppliers and trading partners. A team is currently looking at how the company can support them as they strive to improve their performance.

2.12 Functional Areas

BATB has been operating its business under the following major functional areas:

  •   Production
  •   Leaf
  •   Finance
  •   Human Resource
  •   Marketing
  •   Information Technology
  •   Corporate and Regulatory Affairs
  •   Business Development

For the relevancy of the study, only the marketing department and its structure have been discussed to provide a comprehensive view.

2.13 Marketing Department

The marketing department has two main wings:

  •   Brand Marketing
  •   Trade Marketing and Distribution

While the Brand Marketing wing focuses upon the branding aspects of a product, the Trade Marketing & Distribution (TM&D) Wing focuses upon the trade and distribution aspect. These two wings are joined by the Trade Development Team (TDT).

2.13.1 Brand Marketing

Structure of Brand Marketing Wing

The Brand Marketing department concentrates on satisfying consumers’ needs from within the brand portfolio. Once consumers’ needs are understood and evaluated, brands can be made available, accessible and desirable through strong, consistent communication. The brand marketing elements covers the adopting of products, logistics and brand marketing policies that best meet the needs of particular trade channels and strategic customers. The Brand Managers and Brand Executives are responsible for the allocated brand(s). They are responsible for all type of brand management activities.

Market intelligence includes the in market research teams. The team keeps constant eye on the market situation. Through continuous research, market research teams generate useful market information for the brand managers. Interface is required between brand marketing and research, which is carried out by any project that is divided by three phases:

  •   Preparation prior to the study
  •   Collection and analysis of data
  •   Presentation and utilization of information

Vision and Mission of Brand Marketing

The vision of the Brand Marketing wing is:

Within five years to be the undisputed leader of Bangladesh tobacco market

It also includes:

Dominate value share

  Dominate volume share base

  Destination brand in key segments.

The mission of the wing is:

  •   Promise of future profit growth
  •   Grow quality share: ASU30
  •   Owning the medium and premium segment (90% share)

Core Strategies of Brand Marketing


  1. Expand the premium segment growth.
    1. Internationalism, destination status & image differentiator: Youthful
  2. Expand Mid segment
    1. Key differentiators are international standard with affordability & distinctive image: masculinity/adventure
  3. Dominate volume base
  1. Build the critical mass
  2. Protect BAT’s leadership.


  1. Investigate & build new segments
    1. Lights
    2. New brands & line extensions
  2. Product enhancement
    1. Packaging, spec. change & higher satisfaction
  3. Creative communication
    1. Focused: HoReCa (Hotels, Restaurants and Cafés), rural penetration
  4. Consumer insight
    1. World-class knowledge base: consumer research & market tracking

2.13.2 Trade Marketing and Distribution

Mission and Objectives of TM&D

TM&D Mission is To reach our target consumers in the most efficient and effective way by becoming the benchmark supplier to the trade within strategic channels in every market place where we do business.

TM&D identifies the areas in which best practice must be achieved to enable markets meet the Trade Marketing and Distribution objectives, which are:

  •   Create an efficient entry barrier against international competition
  •   Improve our benchmark supplier status to the trade pioneer among all FMCG companies.

Six Critical Factors to Achieve TM&D Mission

  1. Secondary Supply Chain/ Product Management: Optimize cost and performance while ensuring achievement of brand objectives. The associated sub-activities are:
    1. Supply chain strategy/management
    2. Order management
    3. Order fulfillment
    4. Trading terms
    5. Inventory management
  1. POP (Point of Purchase) Management: Create effective competitive entry barrier at point of sales while driving international brands. The associated sub-activities are:
    1. Display
    2. Promotions
    3. In-store communication/advertising
    4. Implementation
    5. HoReCa (Hotels, Restaurants and Cafes)
  1. Account Management/ Channel Development: Create an effective entry barrier while driving brand imagery, awareness and trial in HoReCa and superior grocery outlets. The associated sub-activities are:
    1. Account planning
    2. Account profitability
    3. New business development
  1. Strategy and Planning: Ensure effective implementation of EMF (effective market focus) process to support achievement of company’s objectives. The associated sub-activities are:
    1. TM&D planning
    2. Cycle planning
    3. Coverage planning
  1. Resource Management: Ensure that TM&D organogram is responsive to the changing trade and company needs. The associated sub-activities are:
    1. Financial planning and management
    2. Manpower planning
    3. Organization development
    4. Management information for marketing overview
  1. Information Management: Drive Quantum business benefits to the fullest. The associated sub-activities are:
    1. Market intelligence
    2. Internal monitoring
    3. Information technology
    4. Customer satisfaction

Structure of TM&D Department:

The following illustrations show detail organizational structures of the TM&D wing. The structure is divided into two segments – Head Office and Regions.