Smok ox- Now quit smoking naturally.

Micro environment factors:-

 Customers
People who are willing to quit smoking realizing its effects.

Employees

Employing the correct staff and keeping these staff motivated is an

essential part of the strategic planning process of an organisation. Training
and development plays an essential role particular in service sector
marketing in-order to gain a  competitive edge.  This is clearly apparent in
the airline industry.

Suppliers

Increase in raw material prices will have a knock on affect on the marketing
mix strategy of an organisation. Prices may be forced up as a result. Closer
supplier relationships is one way of ensuring competitive and quality
products for an organisation. 

Shareholders

As organisation require greater inward investment for growth they face

increasing pressure to move from private ownership to public.  However
this movement unleashes the forces of shareholder pressure on the
strategy of organisations. Satisfying shareholder needs may result in a
change in tactics employed by an organisation. Many internet companies
who share prices rocketed in 1999 and early 2000 have seen the share
price tumble as they face pressures from shareholders to turn in a profit. In
a market which has very quickly become overcrowded many havel failed.

Media

Positive or adverse media attention on an organisations product or service

can in some cases make or break an organisation.. Consumer programmes
with a wider and more direct audience can also have a very powerful and
positive impact, hforcing organisations to change their tactics.

Competitors

Drug from Pfizer.

The name of the game in marketing is differentiation. What benefit can the
organisation offer which is better then their competitors. Can they sustain
this differentiation over a period of time from their competitors?. Competitor
anlaysis and monitoring is crucial if an organisation is to maintain its
position within the market. 

1.Threats of New Entrants=LOW

•New Product differentiation Very Tough – already cigarettes at
different price points, flavors, brand images
• Access to distribution channel is tough – big & established
players are present (e.g. ITC)
• Capital requirement is very high for a pan India launching.
• Local launch can not catch up scale – Can’t use Economies of
scale
• Government policy – high tax, no TV/Radio Ads

2.Bargaining Power of Suppliers=LOW

•Many inputs are required but in small amount – paper, tobacco,
filter
•There are many small scale, unorganized suppliers
•Cigarette companies are big and have direct access to
distribution channel and addicted buyers. Suppliers don’t have
much control over smokers.

3.Bargaining Power of Buyers=LOW

•Addicted customers - even after knowing harms – people can’t
leave it
•Smoking has lot of symbolic and emotional values attached with
it
•Product quality not much important to smokers – Research
shows most people cannot differentiate among the brands in a
blind taste
•Low switching costs in terms of price

4.Threat of Substitute Product=LOW

•Herbal Cigarettes (e.g. Nirdosh) were launched – but did not
become popular (no emotional value)
•Nicotine patch is another substitute – but again no comparison
with cigarettes in terms of popularity and usage

5.Competitive Rivalry in the Industry=HIGH

•Many competing players: ITC, Godfrey Philips, VST, GTC etc -
see chart below
•Price competition continues
•Advertisement for cigarettes is now prohibited in India
•Replacement for ads – event sponsorships and sales promotions
•All making new product launches
 Attentio Creating awareness the customer through television
n advertising, newspaper advertising.
Interest Raise customer interest by demonstrating features, advantages,
and benefits such as eliminating cough, pain in the stomach,
irritability and anxiety which occur immediately when you quit
smoking.
Desire Convince customers that they want and desire the product or
service and that it will satisfy their needs. This can be done
through an attractive tagline .
Action Lead customers towards taking action and/or purchasing. It
can be done by intensive distribution, stating the benefits of the
product in the ads.

Porter’s analysis:-

1)Competitive rivalry

-Pfizer introduced an anti smoking drug called Champix in India.

. It is a prescription drug that will be promoted only through
doctors who will be informed of its risks carried in its labelling.
Smoking is expected to cause 930,000 adult deaths in 2010 in
India and given the growth in population, there will be a million
smoking-associated deaths every year thereafter. At Rs 9,500 for
the three-month treatment, it doesn’t come cheap. Two studies
have shown that 44% of smokers who went through the
prescribed 12-week treatment quit smoking. However, US
regulatory issued warnings on the drug due to the many side
effects associated with it such as mood fluctuations, abnormal
behavior, heart attacks, loss of memory.

-Homeopathic treatment is also available in india.

However, it contains oils like Ylang ylang, rosemary,
peppermint and Eucalyptus which need to be mixed with
alcohol and diluted amounts of nicotine.

2) Threat of substitutes

-Yoga helps people in exercising control over mind and

body. Because of this, people they are able to overcome
their stress and hence they are not addicted to smoking.

- Therapeutic and counselling centres

- Healthy cigarettes(Electronic)

- Candy cigarettes, which are not addictive.

- Hookah

3) Bargaining power of Buyer’s

There are few buyer’s, so buyer’s are powerful. The

buyer’s can at times reject the product because of its
pricing. This product is not standardized, so buyer’s can
easily switch to another product.
4) Bargaining power of suppliers

-The bargaining power of suppliers is quite low.

-This product actually does not need any kind of external

suppliers. We can have our own nurseries and grow the
herbs required for making the product.

5) Threat of new entrants

- The threat of new entrants is very low.

- Local herbal companies can be a threat, however it will be

minimal at initial phase.

- Chantix, if at all it changes the formula of the product and

eliminates the side effects.