MARKETING STRATEGY EMPLOYED BY TOBACCO COMPANY AND THE PROSPECTS FOR GROWTH

Project code: BAM989730   |   Pages: 73   |   Words: 18,323   |   Characters: 115,916   |   Format: Word & PDF

ABSTRACT

This research work is primarily concerned with the phenomenon of marketing strategies employed by Tobacco Companies and the prospects for their growth. A case study of the British American Tobacco Zaria, was undertaken with a view towards taking a critical analysis of the type of marketing strategies adopted by different brands of cigarette and of course to also examine the prospects the company has for growth and continuity. However, a research study on British American Tobacco is incomplete without a flash back into the activities of Nigerian Tobacco Company Ltd, Zaria – a company that BAT has inherited. The research has evaluated briefly the marketing strategies employed by NTC before and the current strategies adopted by BAT. Attempt has been made with much emphasis on marketing strategies adopted by the present corporate management of BAT. The British American Tobacco Company has completely deviated from the older marketing strategies of its predecessors (NTC) ranging from direct involvement of dealers in distribution channels to franchising and marketing executives penetrating nook and corners of their target market with a view to encouraging motivating and initiating outlets including attractive incentives. Evaluation of the company’s marketing strategies was undertaken and in the event a number of useful recommendations were analyzed and put forth to management, direct at enabling the firm to effectively market its wide range of cigarettes brands.
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CHAPTER ONE: INTRODUCTION

1.1       Background of the Study
Marketing is a common phenomenon, but it is quite complex and in fact an elusive subject matter. Marketing means different things to different people just as it affect everyone and is highly controversial. The activities of Marketing are so diverse that its sometimes difficult to say exactly what the term means. But however, the general consensus on marketing is that it is the performance of business activities which involves identifying, anticipating customs wants and satisfy them.
The economic health of any nation depends largely on the healthy marketing system, especially where a huge mass production system and its attendant mass distributions are involved.
The importance and relevance of marketing business, whether in private or public organization cannot be overemphasized. It is against this background that many scholars and practitioners alike began to research extensively on Marketing as a business of exchange transactions.
Strategy is define as “a unified comprehensive, and integrated plan relating the strategic advantages of the firm to the challenges of the environment” (W.F. Gluck 1980). From the definition above, one can  infer that strategy is a behaviour whose purpose is to achieve success for organizational goals in a competitive environment, chiefly rivals, market competitors, suppliers, customers, employees and even governmental unit.
The focus of this research work is on the marketing strategies employed by British American Tobacco Zaria and the prosperity for its growth. Marketing itself is a response to society needs. As society changes, so does marketing; as a society becomes complex so do the needs of its people.
Therefore, desired marketing strategies are required to cope with the dynamism of the society and their needs. For example, a marketer must have a good knowledge of the behavioural sciences that deals with relationship among people which involves sociology, psychology and cultural anthropology. The way people respond as individuals and groups changes over time. More importantly the product under this research study is highly controversial worldwide. In the civilized world, political and ethical actions set legal boundaries for business like the marketing of tobacco products. All over the world, old laws are changed concerning the production, marketing and consumption of Cigarette, new laws are added and new interpretation are given to the existing laws.
However, decisions about what is acceptable behaviour form the ethical environment. Very often, a law is passed because a collective group thinking leads to the conclusion that a certain business practice is not ethical. For example several laws/decrees have either been passed or promulgated to ban or control Cigarette smoking all over the world.
British American Tobacco took over Nigerian Tobacco Company Zaria in the year 2000 B.A.T, ironically was the Parent Company if N.T.C Zaria up till the time the former took over N.T.C. unfortunately NTC’s operations including Marketing had been at its best epileptic for the past one decade now; due probably to some factors that could be traced to poor quality of Nigerian made products, poor and inadequate marketing strategies and practices and alarming scale of smuggler’s activities including high costs of production.
Nigeria Tobacco Company tailed out of Business not because people have stopped smoking but simply because they saw themselves as tobacco company and not Marketing Company that require sound marketing strategies including bench marketing. It is against the foregoing background and facts that makes research of this kind more interesting and worthwhile. This research work is particularly informed by the researcher’s inquisitive mind regarding the high expectations upon the new company (BAT) which has to operate with the conditions attached and under a double standard policies and legislations of the Federal Government. Including very unstable economic environment. Therefore it is the considered opinion of the researcher that this study would go a long way in contributing in a number of ways to improvement of BAT marketing strategies and more importantly to knowledge as a whole.

1.2       Statement of the Problem
The main problem that this research study is set to address and find solution for is the lack of protection over the local industries which has always negated many marketing strategies that may be adopted. This lack of protection is evident in the way and manner the smugglers smuggle into Nigeria Foreign products like Cigarette unchecked and with impunity, and again the numerous and indiscriminate advertisement on our daily media (both print and electronic media).
And again, another disturbing problem is the conflicting and confusing legislations on the manufacturers of tobacco products and the consumers as well. The advertising strategies employed by BAT have always been subjected to criticism from the public. The same advert that encourages people to smoke, that smoking is a way of life again end up warning that “Cigarette Smoking is Dangerous to your Health”.

1.3       Objective of the Study
The main objectives of this research study is to examine the marketing strategies employed by BAT in the marketing of its different brands of cigarettes and more importantly, to look into the prospect the company has its growth.
Essentially the research is aimed at finding out how BAT intends to use the current marketing strategies to carry the company along in the turbulent economy that is not only hostile to the trade practices but totally against smoking.
Furthermore, the researcher intends to introduce, if possible and considered necessary other strategies that could enhance the volume of scales as against what is currently obtainable in BAT.
Finally, to find out how the company hope to tackle the Government and Public ‘double standard’ concerning the need for a tobacco company in Nigeria and the prohibitive revenue accruing from their activities to your health; smokers die young” (Federal Ministry of Health).

1.4       Significance of the Study.
The study is quite significant because of the Nigeria’s high drive for industrialization and the crave for foreign investors to invade Nigerian Business environment.
The researcher study is significant more so as it intend to investigate the paradox surrounding the tobacco business. That is, the country like Nigeria that is aware of the health hazard in smoking will not let go the revenue that such industry could offer, and employment offered as well.

1.5       Research Hypothesis.
Two fundamental assumptions are postulated in this research study as follows:-
2.   That the activities of the smugglers that smuggles foreign cigarettes into Nigerian market has been responsible for BAT’s inability to achieve fruitful results from its Marketing Strategies hence, the company had bleak future prospects.
3.   The Federal Government of Nigeria has always played a lip service to the issue of arresting the illicit activities of the smugglers. It has been observed that some prominent and wealthy individuals in Nigeria are not only sponsoring the smugglers, but connive with Government officials to break the law, against smuggling.
4.   That the equivocal policies and legislations by the Federal Government of Nigeria regarding Tobacco Companies and smoking habit of some Nigeria Citizen have always cast doubt in the minds of the people as far as the activities of British American Tobacco (Nig) Ltd Zaria is concerned.
5.   Because of the fear of violating the Federal Government Laws on Tobacco Advertisement, BAT is compelled to contradict itself in her advertising strategies, such contradiction can readily be noticed in their daily advertisement.

1.6       Scope of the Study
This research study pay particular attention to the marketing strategies employed by British American Tobacco (Nig) Ltd Zaria, and the prospect for their future growth.
Bearing in mind the nature of the topic for study and the circumstances surrounding the birth of BAT, the researcher has decided to briefly mention the Nigeria tobacco company LTD Zaria (the company that BAT took over from). The study therefore is limited to the period of 3 years; that is from the year 2000 to 2002.
Furthermore, the highlights of the study are limited to the strategic planning of marketing functions of BAT, the company’s promotional and pricing strategies, advertising strategies, products policies and development and including the packaging and labeling and physical distribution channels adopted.
The research study also attempt to examine critically what prospects BAT has on the face of turbulent economy like Nigerian’s and the government’s position about smoking that hardly can see any marketing strategies to a success.

1.7       Limitations of a Success
Any research study cannot be completely successful without at least some short-comings; but however, the magnitude of such shortcomings and intensity may differed depending on what the research intends to achieve.
First and foremost, the researcher encounters problems in the areas of data collection. Most of the information required to bring out a perfect study were considered classified documents by the British American Tobacco Company; and as such we hardly could gain access to them.
Notwithstanding, the above constraint, the researcher has tried as much as possible not to compromise the quality of this research study/work.

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