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Growth Strategies Case Study

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Case Title:

Japan Tobacco: Growth Strategies

Publication Year : 2005

Authors: Shashi Bhushan Jaiswal, Susmita Nandi

Industry: Food, Diary and Agriculture Products

Region:Japan

Case Code: GRS0063

Teaching Note: Not Available

Structured Assignment: Not Available

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Abstract:
The competition from foreign players like Philip Morris Inc. (PMI) and British American Tobacco (BAT), the declining population of smokers due to rising health concerns, and Japan's signing of the World Health Organisation Framework Convention on Tobacco Control (FCTC) on March 9th 2004 had decreased the domestic sales of Japan Tobacco (JT) in Japan. Adding to the company's woes was the expiry of contract with PMI to manufacture and sell PMI's cigarette brand, Marlboro in Japan resulting in a decreased domestic market share from 72.7% to 63.2%. To regain its market leadership, JT unveiled its plan to launch 13 tobacco brands in the domestic market in July 2005, which is still believed to be a lucrative market and receptive to new products. However, it was also opined that JT lacked a balanced approach towards international expansion as its global tobacco sales still constituted only 21.3% of its total sales, with 59.9% of JT's tobacco sales value coming from Japan in 2005.

Pedagogical Objectives:

  • To highlight the challenges faced by JT
  • To discuss the growth strategies adopted by JT in order to remain competitive in the challenging tobacco market of Japan.

Keywords : Japan; Japan Tobacco; Philip Morris Inc; Marlboro; Growth strategy; Framework Convention on Tobacco Control (FCTC); Smoking population; Growth Strategies Case Study; Health concerns; Tobacco market; Cigarette maker; International expansion; Global brands

Contents : 
About JT
JT: The Trouble Times
JT:Growth Strategies
JT: Market Share Decline
Smoking Rate In Japan
FCTC provides various measures
Financial Statement of Japan Tobacco
Japan Tobacco: International Business

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