sample="supplemental" bates="501439328" isource="rjr" decade="1980" class="ue" date="19830411" MDD DIRECTORS' PRESENTATIONS TO DEL MONTE/HEUBLEIN ON APRIL 11 - 12, 1983 SLIDE 1 GOOD MORNING. I WOULD LIKE TO GIVE YOU AN OVERVIEW OF R.J. REYNOLDS' TOBACCO MARKETING DEVELOPMENT DEPARTMENT. I THINK THIS OVERVIEW SHOULD GIVE YOU A GOOD UNDERSTANDING OF OUR DEPARTMENT. WHAT I PLAN TO COVER INCLUDES: - WHY MDD EXISTS 0 WHAT WE ARE NOT, AND WHAT WE ARE - OUR END USER CONCEPT, WHICH HELPS CLARIFY OUR STRUCTURE AND SIZE - HOW WE ACTUALLY DEVELOP INFORMATION AND MARKETING INSIGHTS - A BRIEF DISCUSSION OF HOW WE VIEW CONSUMERS. HERE I WILL BRIEFLY TALK ABOUT, AMONG OTHER THINGS, "THE CONSUMER PURCHASE PROCESS". THIS IS A PROCESS WHICH ALL CONSUMERS GO THROUGH BEFORE THEY END UP BUYING A BRAND ON A REGULAR BASIS. WE CONSIDER THIS A SIMPLE, YET POWERFUL, ANALYTICAL TOOL WHICH IS INTEGRAL TO OUR UNDERSTANDING OF CONSUMER THOUGHT AND ACTION. - HOW WE ARE ORGANIZED AND STAFFED. I WILL ONLY TOUCH ONTHIS SINCE YOU WILL HEAR MORE FROM EACH OF THE FOUR AREAS LATER TODAY AND TOMORROW. SLIDE 2 TO GIVE YOU THE BEST PERSPECTIVE, YOU FIRST NEED TO KNOW THAT THE THING THAT MAKES OUR DEPARTMENT IMPORTANT TO R.J. REYNOLDS TOBACCO COMPANY IS THE COMPANY'S COMMITMENT TO BEING A MARKETING COMPANY. MARKETING DEVELOPMENT SLIDE 1 R. J. REYNOLDS TOBACCO A MARKETING COMPANY SLIDE 2 SLIDE 3 LET'S BEGIN WITH OUR CORPORATE DEFINITION OF MARKETING: "MARKETING IS A COMBINATION OF ACTIVITIES DESIGNED TO PRODUCE PROFIT THROUGH ASCERTAINING, STIMULATING, AND SATISFYING CONSUMER WANTS OF A SELECTED SEGMENT OF THE MARKET." IT IS NOT BY ACCIDENT THAT YOU WILL HEAR THAT WORD "CONSUMER" MANY TIMES IN THIS DISCUSSION. WE AS A MARKETING-ORIENTED COMPANY RECOGNIZE OUR SUCCESS OR FAILURE DEPENDS PRIMARILY ON PROVIDING PRODUCTS THE CONSUMER WANTS AND, ADDITIONALLY, WE RECOGNIZE THE ULTIMATE CONSUMER IS THE FINAL JUDGE OF WHETHER THE COMPANY CAN GIVE US A TREMENDOUS AMOUNT OF DIRECTION IF WE KNOW WHAT TO LOOK FOR, WHAT TO ASK, AND HOW TO INTERPRET IT. THEREFORE, AS YOU CAN SEE, THE KEY ISSUE IS SATISFYING THE WANTS OF THE CONSUMER. SLIDE 4 - IF CONSUMERS' WANTS ARE MET, HE OR SHE WILL SPEND HIS OR HER MONEY FOR THE PRODUCT, AND THE COMPANY WILL PROSPER. BECAUSE CIGARETTES ARE THE ONLY CATEGORY WHERE THE PRODUCT IS USED 20, 30, 40 OR MORE TIMES A DAY, THE CONSUMER MUST BE CONTINUALLY SATISFIED. THIS REQUIRES INTENSIVE MARKETING SUPPORT. SLIDE 5 - IF CONSUMERS' WANTS ARE NOT MET, HE OR SHE WILL NOT BUY THE PRODUCT. IN FACT, WE KNOW THAT CONSUMERS WILL SWITCH WHENEVER OUR PRODUCT DOES NOT FULFILL THEIR EXPECTATIONS. AND THEY WOULD RATHER SWITCH THAN TELL US OF THEIR DISSATISFACTION. TWO AND A HALF CONSUMERS WILL SWITCH FOR EVERY ONE THAT IS WILLING TO WRITE A COMPLAINT LETTER. "MARKETING IS A COMBINATION OF ACTIVITIES DESIGNED TO PRODUCE PROFIT THROUGH ASCERTAINING AND SATISFYING CONSUMER WANTS OF A SELECTED SEGMENT OF THE MARKET." SLIDE 3 SLIDE 4 SLIDE 5 SLIDE 6 - ALL THE ADVERTISING, PROMOTION, DEALER INCENTIVES, ETC. WILL NOT MAKE A CONSUMER BUY SOMETHING HE OR SHE DOESN'T WANT. SLIDE 7 - AS A MARKETING-ORIENTED COMPANY, WE UNDERSTAND THIS COMPLETELY AND, FOCUS OUR ENERGIES AND RESOURCES WITH SINGLE-MINDED DETERMINATION ON SATISFYING THE WANTS OF THAT CONSUMER. THIS IS HOW WE BELIEVE AN EFFECTIVE MARKETING COMPANY OPERATES. THIS WILL ALSO BE THE GROUNDWORK FOR EXPLAINING OUR DEPARTMENT'S ROLE WITHIN RJR. LET ME COVER A FEW MORE DISTINCTIONS OF A MARKETING COMPANY. SLIDE 8 - THE MARKETING COMPANY FINDS OUT AS MUCH AS IT CAN ABOUT THE CONSUMER REACTION TO ITS PRODUCTS AND MODIFIES THEM, AS NECESSARY, TO FIT THE CONSUMER'S REQUIREMENTS. SLIDE 6 WE FOCUS OUR ENERGIES AND RESOURCES WITH SINGLE-MINDED DETERMINATION ON SATISFYING THE WANTS OF THE CONSUMER. SLIDE 7 FIND OUR CONSUMERS' REACTION TO PRODUCTS FIT CONSUMERS" REQUIREMENTS SLIDE 8 SLIDE 9 - IT LEARNS AS MUCH AS IT CAN ABOUT THE CONSUMER AS A PERSON. FOR EXAMPLE, THIS WOULD INCLUDE THE CONSUMER'S: SLIDE 10 - SELF IMAGE - GOALS - LIKES/DISLIKES/CONCERNS - VIEW OF THE FUTURE - ASPIRATIONS. IN ESSENCE WE TRY TO LEARN EVERYTHING ABOUT HIM OR HER THAT WILL ENABLE US TO VISUALIZE THAT CONSUMER AS A REAL PERSON. I THINK IT IS IMPORTANT TO NOTICE THAT WE DO NOT JUST LOOK AT THE CONSUMER AS A SMOKER. IT'S IMPORTANT TO KNOW THE CONSUMER AS A SMOKER, BUT THAT IS ONLY THE BEGINNING. THE MORE WE CAN KNOW OUR CONSUMERS AS REAL LIVE PEOPLE, THE MORE WE CAN DEVELOP PRODUCTS, AND ADVERTISING, AND PROMOTIONAL ACTIVITIES, AND SO ON TO FIT THEIR WANTS. I NEED NOT GO INTO THIS IN MORE DETAIL - WE ALL UNDERSTAND THESE. ALL I WILL SAY IS THAT QUALITATIVE IS MORE THAN FOCUS GROUPS TO US. WE BELIEVE IN THE VALUE OF QUANTITATIVE RESEARCH AND USE A VARIETY OF TECHNIQUES - GROUPS, ONE-ON-ONES, AND SYNECTICS TO HELP US GAIN AN UNDERSTANDING AND DEVELOP HYPOTHESIS FOR FUTURE EXPLORATION. SLIDE 25 WE ALSO PROVIDE MARKETING INSIGHTS BY ANALYZING THE WEALTH OF INFORMATION THAT CURRENTLY EXISTS IN AN ATTEMPT TO ADDRESS SPECIFIC ISSUES. FOR EXAMPLE, STRATEGIC "WHITE PAPERS" DEALING WITH SUCH TOPICS AS THE IMPLICATIONS OF THE AGING POPULATIONS OR THE EFFECT OF TECHNOLOGY ON OUR LIVES ARE BASED ON ANALYZING EXISTING INFORMATION. APPROACHES TO DEVELOPING INFORMATION AND MARKETING INSIGHTS RESEARCH STUDIES - QUANTITATIVE - QUALITATIVE SLIDE 24 APPROACHES TO DEVELOPING INFORMATION AND MARKETING INSIGHTS RESEARCH STUDIES - QUANTITATIVE - QUALITATIVE ANALYSIS OF EXISTING INFORMATION SLIDE 25 SIMILARLY, FORECASTING A SPECIFIC BRAND'S FUTURE PERFORMANCE IS BASED, TO A LARGE EXTENT, ON EXISTING INFORMATION. SLIDE 26 WE CAN ALSO CONTRIBUTE TO THE DECISION PROCESS BY SOLVING PROBLEMS -- BY PROVIDING MANAGEMENT AN ADDITIONAL PERSPECTIVE BASED ON OUR EXPERIENCE AND KNOWLEDGE OF THE MARKETPLACE. THIS DOES NOT HAVE TO BE BASED ON ANY SPECIFIC STUDY OR PAST DATA, AND CAN TAKE THE FORM OF AN INFORMAL DISCUSSION OR PROVOCATIVE MEMO. WHAT IT IS BASED ON IS THE FACT THAT WE HAVE VERY SMART PEOPLE WHO CAN CONTRIBUTE AND WHO KNOW HOW TO SOLVE PROBLEMS. SLIDE 27 WE OFTEN SERVE AS A REFLECTOR OR SOUNDING BOARD. SINCE WE ARE SO FAMILIAR WITH THE CONSUMER, WE CAN OFTEN LISTEN TO A PRESENTATION OR READ A DRAFT OF A RECOMMENDATION AND OFFER USEFUL ADVICE BEFORE IT GOES UP THE LADDER. I THINK IT IS IMPORTANT TO POINT OUT THAT WE DO NOT VIEW RESEARCH TECHNIQUES, COMPUTER PRINTOUTS AND DATA AS OUR SOLE WAY OF CONTRIBUTING TO THE DECISION PROCESS. ACTUAL RESEARCH STUDIES ARE MERELY A LOGICAL NEXT STEP - AT TIMES - AFTER WE HAVE HELPED BY DISCUSSING - AND UNDERSTANDING - BRAND QUESTIONS AND CONCERNS. FREQUENTLY, ACTUAL STUDIES BECOME UNNECESSARY ONCE WE HAVE CONTRIBUTED IN OTHER WAYS. APPROACHES TO DEVELOPING INFORMATION AND MARKETING INSIGHTS: RESEARCH STUDIES - QUANTITATIVE - QUALITATIVE ANALYSIS OF EXISTING INFORMATION HELP SOLVE PROBLEMS - AN ADDITIONAL PERSPECTIVE SLIDE 26 APPROACHES TO DEVELOPING INFORMATION AND MARKETING INSIGHTS: RESEARCH STUDIES - QUANTITATIVE QUALITATIVE ANALYSIS OF EXISTING INFORMATION HELP SOLVE PROBLEMS - AN ADDITIONAL PERSPECTIVE SERVE AS A "REFLECTOR" SLIDE 27 SLIDE 28 ALL OF THESE STUDIES AND ANALYSES ARE INTENDED TO HELP US GIVE CONSUMERS WHAT THEY WANT. AS I HAVE SAID BEFORE, THAT IS THE ONLY WAY WE WILL BE SUCCESSFUL. ACTUALLY, THERE ARE FOUR THINGS NECESSARY IF WE ARE TO GIVE CONSUMERS WHAT THEY WANT. WE NEED TO: - UNDERSTAND WANTS - PREDICT WANTS - GROUP SMOKERS WITH SIMILAR WANTS - CONTINUALLY FINETUNE OUR UNDERSTANDING OF THOSE WANTS SLIDE 29 LET ME SPEAK TO EACH OF THESE POINTS. WE SPEND A GOOD DEAL OF TIME AND EFFORT TRYING TO UNDERSTAND CONSUMER WANTS. CONSUMERS HAVE ALL SORTS OF WANTS. IN OUR INDUSTRY TWO TYPES OF WANTS ARE EXTREMELY IMPORTANT. PRODUCT WANTS AND IMAGERY. PRODUCT WANTS SUCH AS LOW TAR, GOOD TASTE, MENTHOL OR NON-MENTHOL, 85MM OR 100MM, ETC. ARE ESSENTIAL. IF OUR PRODUCTS DO NOT SATISFY THOSE WANTS SMOKERS WILL NOT BUY OUR BRANDS. PROBABLY JUST AS IMPORTANT AS PRODUCT WANTS ARE IMAGERY WANTS. SOMETIMES PEOPLE SAY IMAGERY REALLY IS NOT THAT IMPORTANT TO THEM, BUT WE DON'T BELIEVE THAT. FOR EXAMPLE, VIRGINIA SLIMS IS NOT A BAD TASTING PRODUCT BUT FEW MEN WOULD BE CAUGHT DEAD SMOKING IT. WHY? BECAUSE THE VIRGINIA SLIMS IMAGE EMBARRASSES THEM. - UNDERSTAND WANTS - PREDICT WANTS - GROUP SMOKERS WITH SIMILAR WANTS - CONTINUALLY FINETUNE SLIDE 28 - UNDERSTAND WANTS SLIDE 29 SLIDE 30 WHILE IT IS ESSENTIAL TO UNDERSTAND WANTS, UNDERSTANDING WANTS IS NOT ENOUGH. IF WE ARE TO MAINTAIN OUR POSITION IN THE MARKETPLACE WE ACTUALLY HAVE TO PREDICT WANTS. IT IS VERY IMPORTANT TO BE A STEP AHEAD OF OUR COMPETITORS. SLIDE 31 THEY ALSO WORK ON LONG TERM NEW PRODUCT PROGRAMS AND PROJECTS WITH BRAND AND R&D TO MEET EMERGING CONSUMER WANTS. THIS HELPS ENSURE THE COMPANY WILL HAVE INNOVATIVE NEW PRODUCTS TO MARKET IN THE LONGER TERM (3-5 YEARS). NEW BRANDS AND STRATEGIC RESEARCH SLIDE 49 NEW BRANDS AND STRATEGIC RESEARCH END USERS: NEW BRANDS MARKETING PLANNING BRAND MARKETING AND RESEARCH PUBLIC AFFAIRS STP R&D SLIDE 50 SLIDE 51 THE MISSION OF THE CONSUMER RESEARCH AREA IS TO OPTIMIZE OUR KNOWLEDGE OF CONSUMER BEHAVIOR AND OF SPECIFIC ELEMENTS OF THE MARKETING MIX AS THEY RELATE TO CONSUMER BEHAVIOR (E.G., PRODUCT, ADVERTISING, PROMOTION, ETC.). SLIDE 52 THIS AREA WORKS CLOSELY WITH THE OTHER SECTIONS IN MARKETING DEVELOPMENT, AS WELL AS WITH NUMEROUS EXTERNAL END USERS SUCH AS TOBACCO RESEARCH & DEVELOPMENT, MEDIA, PROMOTION, SPECIAL EVENTS, AND SALES, IN DEVELOPING RESEARCH PROGRAMS DIRECTED TO THEIR PARTICULAR INFORMATION NEEDS AND ACTION PLANS. THE PRODUCT RESEARCH GROUP WORKS CLOSELY WITH R&D AND ALSO HELPS END USERS IN MDD BY COORDINATIONS PRODUCT RESEARCH AND ACTIVITIES. A RECENT ADDITION TO THE PRODUCT RESEARCH GROUP IS THE CONSUMER RELATIONS SECTION WHICH IS RESPONSIBLE FOR RESPONDING TO AND ANALYZING CONSUMER CORRESPONDENCE CONCERNING OUR PRODUCTS. THE CONSUMER TRACKING GROUP IS RESPONSIBLE FOR TRACKING KEY CONSUMER BEHAVIOR MEASURES ON BOTH OUR BRANDS AND OUR COMPETITION. CONSUMER RESEARCH SLIDE 51 CONSUMER RESEARCH END USERS: MDD R&D MEDIA PROMOTION MANUFACTURING QUALITY ASSURANCE SALES SLIDE 52 THE ADVERTISING AND PROMOTION STAFF PROVIDE ADVERTISING AND PROMOTION RESEARCH SUPPORT TO MARKETING SERVICES - MEDIA AND PROMOTION, AND ALSO SUPPORTS BRAND RESEARCH BY PROVIDING VALID AND RELIABLE ADVERTISING RESEARCH DATA. BLANK SLIDE 53 THE MISSION OF THE MARKETING SCIENCES AND INFORMATION AREA IS TO PROVIDE RJR'S PERFORMANCE TRACKING ANALYSIS AND FORECASTS IN SUPPORT OF OPERATING AND STRATEGIC PLANNING, AND TIMELY AND ACTIONABLE MARKETING INFORMATION, INTELLIGENCE AND QUANTITATIVE METHODS SUPPORT AS INPUT TO MARKETING/SALES DECISIONS. SLIDE 54 THE MARKETING DECISIONS SYSTEM GROUP MANAGES THE MARKETING INFORMATION SYSTEM THAT PROVIDES RAPID ACCESS TO DATA SOURCES CRITICAL TO MARKETING/SALES DECISIONS. AS I MENTIONED EARLIER, THE FORECAST GROUP PROVIDES THE MID-TERM AND LONG-RANGE FORECASTS THAT ARE USED FOR FINANCIAL PROJECTIONS, LEAF PURCHASES, FACILITIES PLANNING, AND STRATEGIC PLANNING OF MARKETING EFFORTS. THIS GROUP IS ALSO RESPONSIBLE FOR COMPANY/BRAND PERFORMANCE ANALYSES, TRACKING COMPETITIVE NEW BRANDS, AND ASSESSING SALES PERFORMANCE IN TEST MARKETS. MARKETING SCIENCES & INFORMATION SERVICES SLIDE 53 MARKETING SCIENCES & INFORMATION SERVICES END USERS: MANUFACTURING PRODUCTION PLANNING TRAFFIC, DISTRIBUTION SALES LEAF FACILITIES PLANNING MERCHANDISING MDD EXECUTIVE MANAGEMENT SLIDE 54 THE MARKETING INTELLIGENCE GROUP PROVIDES EXECUTIVE MANAGEMENT WITH STRATEGIC INTELLIGENCE ON COMPETITIVE ACTIVITIES BY COLLECTING AND REPORTING COMPETITIVE INFORMATION ALONG WITH ITS IMPLICATIONS. SLIDE 55 THIS SHOULD SET THE STAGE FOR YOU FOR THE NEXT TWO DAYS. I HOPE THAT I HAVE CLEARLY COVERED SEVERAL POINTS I THINK ARE IMPORTANT. DURING SUBSEQUENT PRESENTATIONS THESE POINTS SHOULD BE COVERED MORE, BUT TO SUMMARIZE BRIEFLY: - WE ARE DRIVEN BY THE CONSUMER AND THE FACT THAT WE ARE A CONSUMER PRODUCTS COMPANY. WE BELIEVE THERE IS A WEALTH OF INFORMATION AVAILABLE FROM THE CONSUMER AND IT IS APPLICABLE TO A VARIETY OF AREAS. WE CONTINUALLY COME UP WITH MORE USES. - WE ARE GENERALISTS - PRIMARILY MARKETING GENERALISTS - WHO KNOW HOW TO USE RESEARCH TO HELP OUR EFFORTS. WE ARE EXCELLENT AT RESEARCH, BUT ALWAYS WANT TO PUT IT IN ITS PROPER PERSPECTIVE. WE DO NOT EARN OUR KEEP BY DOING RESEARCH - WE EARN OUR KEEP BY HELPING MANAGEMENT. INCIDENTALLY, YOU WILL SEE THIS PHILOSOPHY IN OUR RECRUITING AND TRAINING EFFORTS, AND I HAVE DISCUSSED THE CAREER PATHS OUTSIDE THE RESEARCH OF ALL OF OUR RECENT SENIOR MANAGEMENT. - WE ARE CONSULTANTS TO END USERS. THE CONSULTING CONCEPT WILL BE DISCUSSED IN A LITTLE MORE DETAIL LATER, AND I THINK THE END USER CONCEPT SHOULD BE CLEAR BY NOW. I HOPE THIS TASK FORCE WILL BE THE START OF A POSITIVE RELATIONSHIP BETWEEN ALL OF US. WE LOOK FORWARD TO CULTIVATING A GOOD RELATIONSHIP WHERE WE CAN LEARN FROM YOU, AND YOU CAN LEARN FROM US. AT THIS POINT, I WILL BE GLAD TO ANSWER ANY QUESTIONS YOU MIGHT HAVE. MARKETING DEVELOPMENT AT R J R SLIDE 55 ESTABLISHED BRANDS RESEARCH - PHILOSOPHY - MAJOR ISSUES PHILOSOPHY CONSUMER DRIVEN WE KNOW TYPES OF CONSUMER INPUT AVAILABLE AND SYNTHESIZE IT INTO ACTIONABLE CONCLUSIONS PRAGMATIC - ISSUE ORIENTED, NOT TECHNIQUE DRIVEN PHILOSOPHY MANAGEMENT'S LINK WITH THE CONSUMER MARKETING GENERALISTS WITH RESEARCH EXPERTISE PRAGMATIC ISSUE ORIENTED, NOT TECHNIQUE DRIVEN MARKETING CONSULTANTS - NOT LIMITED TO RESEARCH - INTRODUCED SYNETICS/CREATIVITY APPROACH TO RJR - INCREASED UNDERSTANDING OF IMPLICATIONS OF IMAGERY - YEARLY BUSINESS ANALYSIS THOUGHT PROVOKING - QUITE A BIT OF QUALITATIVE - "WHITE" PAPERS/MEMOS CONSULTING SEMINAR TOPICS WHAT IS A CONSULTANT WHY CONSULTANTS ARE USED INTERNAL VERSUS EXTERNAL CONSULTANTS WHY WE (MDD) ARE CONSULTANTS MULTIPLE ROLES OF CONSULTANT CHARACTERISTICS OF GOOD CONSULTANTS PITFALLS IN CONSULTING WHY WE (MDD) ARE CONSULTANTS ROLE - HELP MANAGEMENT/BRAND MANAGE THEIR BUSINESS TO GIVE THE MOST HELP, SHOULD USE ALL OUR ASSETS WE ARE: -- RESEARCH EXPERTS -- SOMEWHAT REMOVED FROM "POLITICAL" PROCESS -- SUPPOSED TO BE OBJECTIVE -- SUPPOSED TO BE ACTIVE -- LINK WITH THE CONSUMER -- STRUCTURED TO OFFER SEVERAL PERSPECTIVES -- STRUCTURED PARALLEL WITH BRAND -- KNOW A LOT ABOUT OUT BRANDS AND THE MARKETPLACE -- HAVE, IN LARGE PART, A MARKETING GENERALIST PERSPECTIVE -- SPEND A LOT OF TIME THINKING, R·E·, STRATEGIC ISSUES -- SMART CONSULTANT ROLE USES THESE ASSETS MORE FULLY THAN DO THE ROLES OF: -- RESEARCH GURU -- STAFF SUPPORT FUNCTION GOOD CONSULTING TRAITS Views Mind As Key Asset Initiates Personal Skills Self-Confident Values Client's Input Communication Skills Professional Self Image Smart Creative Problem-Solving Ability Logical Flexible Starts Small At Times Likes Helping CONSULTING PITFALLS Poor Initial Contact Doesn't Know Client Well Enough Fails to Take Into Account Other Key People Lacks Legitimacy Client Too Dependent Lacks Intermediate Goals To Keep Interest Up Fails To Take Things Far Enough Only Reacts Unrealistic Expectations Power Play: Consultant vs. Client Fails to Confront Sensitive Issues Lack Of Creativity Plays It Too Safe Creates Environment that Begs For Persistance Lack of Management's Support DIFFERENTIATING TRAITS OF EACH CONSULTING ROLE COLLABORATOR/PROBLEM SOLVER Interdependent 2-way Communication Offers Alternatives Environment Of Mutual Respect Wears Client's Shoes ADVOCATE Advocates Action Client Should Take Anticipates Resistance Does Homework Leads Discussion Assertive Sensitive REFLECTOR Have Going In Thoughts Reflective/Not Professional Asks Open End Questions Probes Offers Solutions TRAINER Active Simple Communications Expert Maintains Control Customizes Instructions Explains Usefulness TECHNICAL SPECIALIST Expert Simple Communications Recommends Specific Technical Actions Convincingly Shows Expertise Directs Discussion FACT FINDER Passive Responsive Tries To Do More Complete BRAND TEAM ORIENTATION ALL AREAS ARE INVOLVED WITH A BRAND'S MAJOR ISSUES, BUT ALSO HAVE THEIR OWN SPECIATLITYES/ROLES MDD'S OBJECTIVITY (CONSUMER'S VOICE) DETAILED ANALYSIS RESEARCH MAJOR TYPES OF ISSUES BUSINESS ANALYSIS MONITORING PERFORMANCE AND IDENTIFYING A BRAND'S STRENGTHS AND WEAKNESSES POSITIONING/REPOSITIONING STRATEGIES PRODUCT DEVELOPMENT AND EVALUATION ADVERTISING DEVELOPMENT AND EVALUATION PACKAGING, PROMOTION, LINE EXTENSION BUSINESS ANALYSIS FIRST STEP IN A BRAND'S YEARLY PLANNING PROCESS THOROUGH ANALYSIS OF EVERY ASPECT OF EACH BRAND'S BUSINESS AND COMPETITION INCLUDES OUR OBJECTIVE CONCLUSIONS AND BRAND TEAM'S INDICATED ACTIONS BUSINESS ANALYSIS AREAS - NATIONAL - REGIONAL - MAJOR METRO - HISPANIC/BLACK SEGMENT ANALYSIS - SHARE - WANTS OF CORES AND FRINGES SWITCHING BEHAVIOR DEMOGRAPHICS AWARENESS, TRIAL, PURCHASE PRODUCT AND USER PERCEPTIONS PURCHASE PATTERNS TARGET DEFINITION PRODUCT PERFORMANCE ADVERTISING PERFORMANCE SPENDING AND MEDIA ANALYSIS MONITORING PERFORMANCE AND IDENTIFYING STRENGTHS AND WEAKNESSES WHILE BUSINESS ANALYSIS IS A ONCE A YEAR EFFORT, MONITORING GOES ON CONTINUALLY. - MONTHLY STATE OF BRAND REPORTS - WEEKLY SHIPMENT ANALYSIS - CONSUMER MEASURES THIS ALLOWS US TO START INVESTIGATING PERFORMANCE PROBLEMS QUICKLY. MORE IS AN EXAMPLE. MORE ATTEMPTED TO EXPAND TARGET INTRODUCTION OF MORE LIGHTS. - MORE LIGHTS CURRENTLY HAS LOW SHARE DUE TO SOMEWHAT LOW AWARENESS BUT EXTREMELY LOW TRIAL. -THERE ARE INDICATIONS THAT CONSUMERS: - HAVE NO REASON TO WANT TO TRY MORE LIGHTS - FIND MORE LIGHTS INCONSISTENT WITH MORE - CURRENTLY DEVELOPING PERSPECTIVE ON HOW TO FIX MORE LIGHTS. POSITIONING/REPOSITIONING STRATEGIES USING CONSUMER INPUT, WE DEVELOP A THOROUGH UNDERSTANDING OF BRANDS' IMAGE AND TARGETS' WANTS TO OBJECTIVELY EVALUATE WHERE A BRAND IS AND WHERE IT MIGHT MOVE. THE VANTAGE REASSESSMENT EFFORT IS AN EXAMPLE. - POSITIONING RECOMMENDATION AND REQUIRED NEST STEPS - BRAND THE SYNTHESIS OF ALL THE CURRENT INFORMATION ON VANTAGE INTO A CONCISE, MARKETING ORIENTED DOCUMENT REQUIRE TIME, LOGIC AND BRAINPOWER. SALES PRODUCT ADVERTISING IMAGE MARKETPLACE WANTS SEGMENTATION STUDY WE NEEDED TO KNOW HOW TO CEMENT OUR FRINGE, AND BEGIN TO ATTRACT MERIT FRINGE. - COULD DO SO BY IMPROVING VANTAGE'S PERCEPTIONS TO MEET THE WANTS OF THESE FRINGES HOW DO PERCEPTIONS DIFFER? HOW DO WANTS DIFFER? PERCEPTIONS TO A LARGE EXTENT, THE VANTAGE FRINGE AND MERIT FRINGE PERCEIVED VANTAGE SIMILARLY TO THE VANTAGE CORE. WANTS HOWEVER, THESE FRINGES HAD SOME DIFFERENT WANTS. ALL THIS LED TO A POSITIONING OF VANTAGE THAT ULTIMATELY RESULTED IN THE "TASTE OF SUCCESS". - ONE FALSE START - DID NOT CHANGE OUR BELIEVES OF VANTAGE, RATHER, WE THOUGHT OF ANOTHER POSITIONING THAT WAS CONSISTENT PRODUCT DEVELOPMENT AND EVALUATION SALEM OPPORTUNITY ANALYSIS IDENTIFIED TARGET SEGMENTS WITH GOOD LONG TERM OPPORTUNITY - 18-24 YEAR OLD MALE/FEMALE - 25-34 YEAR OLD FEMALE EXISTING PRODUCTS WERE NOT POSITIONED AGAINST THESE TARGETS. RETABBING SHOWED SEVERAL STYLES WERE AT A COMPETITIVE DISADVANTAGE. ANALYSIS INDICATED PRIMARY PROBLEMS WERE - NOT ENOUGH MENTHOL - NOT ENOUGH STRENGTH PROTOTYPE DEVELOPMENT FOCUSED ON INCREASING MENTHOL (WIDE RANGE OF ALTERNATIVES) AND STRENGTH (INCREASED TAR, CHANGED AIR DILUTION). IMPRESSIVE RESULTS. NOW SIX OF SALEM'S SEVEN STYLES ARE SUPERIOR TO COMPETITION. ATTRIBUTE PERFORMANCE (PROTOTYPE VS. CURRENT) MORE SATISFYING COOLER MORE MENTHOL MORE SATISFYING STRONGER COOLER MORE MENTHOL ATTRIBUTE PERFORMANCE (PROTOTYPE VS. CURRENT) MORE SATISFYING COOLER MORE MENTHOL STRONGER AND SMOOTHER MORE SATISFYING COOLER MORE MENTHOL MILDER/LESS HARSH SUMMARY THE ROLE OF AN ESTABLISHED BRAND RESEARCHER IS TO HELP MARKETING MANAGE THEIR BUSINESS USING ALL AVAILABLE CONSUMER INPUT. - STRATEGIC THINKING FROM CONSUMER ORIENTATION - KNOW BUSINESS BY CONSTANT MONITORING AND INTEGRATING LEARNING ON ALL MARKETING ELEMENTS FROM ALL SOURCES. CONSUMER RESEARCH MISSION PLAN AND DIRECT RESEARCH PROGRAMS DESIGNED TO OPTIMIZE KNOWLEDGE OF SPECIFIC ELEMENTS IN THE MARKETING MIX (PRODUCT, ADVERTISING, PROMOTION) AS THEY RELATE TO CONSUMER BEHAVIOR, TO ASSURE THAT CONSUMER INPUT HAS AN INFLUENCE ON MARKETING DECISIONS. ALSO, TO ENSURE THE EFFECTIVE OPERATION AND UTILIZATION OF THE DEPARTMENT'S CONSUMER TRACKING SYSTEMS FOR MARKETING DECISION-MAKING. KEY ACCOUNTABILITIES 1. SUPPORT THE CONSUMER-RELATED NEEDS OF END-USERS IN -- MARKETING DEVELOPMENT -- R&D; MANUFACTURING -- MARKETING SERVICES (MEDIA; PROMOTION; SPECIAL EVENTS) -- PUBLIC RELATIONS; CORPORATE MANAGEMENT 2. ENSURE THE KNOWLEDGE IS SUMMARIZED AND INTEGRATED WITH OTHER RESEARCH INFORMATION TO ENABLE ACTIONABLE DECISION MAKING. 3. DEVELOP IMPROVED SYSTEMS OF RESEARCH. 4. ENSURE THAT THE PROCESS AND TECHNIQUES ARE FULLY UNDERSTOOD AND UTILIZED BY END-USERS. THIS ORIENTATION WILL FOCUS ON: HOW WE AID DECISION MAKERS. WHAT INFORMATION WE PROVIDE. HOW WE ENSURE END-USER UNDERSTANDING. HOW WE AID DECISION MAKERS 1. WE APPROACH THE MARKETING PROCESS FROM A CONSUMER STANDPOINT. 2. WE RELATE OUR KNOWLEDGE OF CONSUMERS TO MARKETING ISSUES/ACTIONS. CONSUMER PURCHASE PROCESS MARKETING ISSUES FAMILIARITY GAIN ATTENTION COMMUNICATE: INFORMATION EMOTIONAL APPEALS PERCEPTIONS FORM BELIEFS ATTITUDES DEVELOP ATTITUDES EXPECTATIONS AFTER TRIAL BEHAVIOR TRIAL ACCEPTANCE ADOPTION HOW WE AID DECISION MAKERS 3. WE DIRECT RESOURCES TO LEARNING HOW CONSUMERS THINK AND BEHAVE. -- PRODUCT RESEARCH GROUP A. ADDRESSES PRODUCT RESEARCH ISSUES IN SUPPORT OF RJR TOBACCO NEEDS; B. ENSURES THAT CUSTOMER INPUT IS PROVIDED IN THE DEVELOPMENT OF PRODUCTS; C. ENSURES THAT QUALITY IS MAINTAINED AT THE CONSUMER LEVEL. -- CONSUMER TRACKING GROUP A. PROVIDES CONSUMER TRACKING SYSTEMS IN SUPPORT OF MDD AND CORPORATE NEEDS; B. ENSURES THAT KNOWLEDGE ABOUT THE CONSUMER ENABLES ACTIONABLE DECISION MAKING; C. ENSURES THAT THE PROCESSES AND TECHNIQUES ARE FULLY UNDERSTOOD AND UTILIZED BY END USERS. -- ADVERTISING AND PROMOTION GROUP A. PROVIDES DEVELOPMENTAL AND EVALUATIVE CONSUMER RESEARCH TO SUPPORT MDD AND MARKETING SERVICES END USERS; B. DEVELOPS PROGRAMS TO IMPROVE THE UTILIZATION AND UNDERSTANDING OF ADVERTISING/PROMOTION RESEARCH AND MEASUREMENT TOOLS; C. PROVIDES SUMMARIES AND ANALYSES WHICH INCREASE END USER KNOWLEDGE OF ADVERTISING AND THE COMPANY'S POSITION RELATIVE TO COMPETITION AMONG STRATEGIC SMOKER GROUPS. DIRECTOR - MARKETING SCIENCES AND INFORMATION SERVICES JERRY MOORE GROUP MRM - MARKETING DECISION SYSTEMS JOHN SAYLOR MRM - MDS LEE YANCEY MDS DEVELOPMENT PROGRAMMING SUPPORT COMPUTER SERVICES USER TRAINING AND SUPPORT ASST. MRM - SALES INFO. SER. DIANE LAWRENCE COORDINATE DATA PRODUCTION INFORMATION RETRIEVAL DEVELOP REPORTS FOR FIELD SALES PRODUCE NEW BRAND ALLOCATIONS ASST. MRM - MKTG. INFO. SER. PEGGY FULK INFORMATION RETRIEVAL DEVELOP REPORTS FOR MARKETING AND MDD MRM - MERCHANDISING JIM WATKINS MERCHANDISING STUDIES RETAIL MARKET SEGMENT STUDIES SPECIAL REQUESTS INFORMATION SERVICES MDD: DIANE LAWRENCE -0 SALES PEGGY FULK - MARKETING AND MDD END USERS: MARKETING SALES MDD KEY ISSUES: PROVIDE QUICK RETRIEVAL AND TIMELY REPORTING OF MARKETING DATA FOR TRACKING AND EVALUATING MARKET PERFORMANCE. SUPPORT THE ANALYSIS OF OUR BUSINESS BY COORDINATING THE FLOW OF DATA TO AND FROM MDD. PROGRAMS: COORDINATE THE PRODUCTION OF CIGARETTE VOLUME AND SHARE DATA, INCLUDING SUBMARKET DATA. DEVELOP ANALYTICALLY ORIENTED REPORTS AND PROVIDE QUICK RETRIEVAL OF SHIPMENT AND SHARE DATA. CODING MAINTENANCE, IMPLEMENTATION, AND VERIFICATION OF MDS DATABASES. PREPARATION AND DISTRIBUTION OF ROUTINE MSA REPORTS. PREPARATION AND DISTRIBUTION OF NEW BRAND ALLOCATORS. MERCHANDISING/SALES RESEARCH MDD: JIM WATKINS END USERS: MERCHANDISING SALES KEY ISSUE: PROVIDE RESEARCH SERVICES TO ASSIST SALES AND MERCHANDISING IN THE DEVLEOPMENT, IMPLEMENTATION, AND EVALUATION OF EFFECTIVE PROGRAMS. PROGRAMS DEVELOP AND MANAGE TESTS TO EVALUATE ALTERNATIVE MERCHANDISING PROGRAMS DIRECTED TO RETAIL OUTLETS. PROVIDE CIGARETTE PROFITABILITY STUDIES. PROVIDE ANALYSIS OF PURCHASE BEHAVIOR IN RETAIL SECTORS AND RETAIL MARKET SEGMENT STUDIES. PROVIDE ANALYSIS FOR SPECIAL REQUESTS TO ASSIST THE SALES DEPARTMENT. DIRECTOR - MARKETING SCIENCES AND INFORMATION SERVICES JERRY MOORE MRM - QUANTITATIVE METHODS ED HARDMAN SPECIAL PROJECTS REQUIRING QUANTITATIVE/STATISTICAL EXPERTISE DEVELOP NEW/IMPROVED METHODS STATISTICAL CONSULTING TO MDD QUANTITATIVE METHODS MDD: ED HARDMAN END USER: MDD KEY ISSUE: IDENTIFY, DEVELOP AND APPLY MARKETING SCIENCES PROBLEM -SOLVING APPROACHES IN SUPPORT OF THE COMPANY'S MANAGEMENT DECISIONS. PROGRAMS: PROVIDE QUANTITATIVE RESEARCH PROBLEM DEFINITIONS, DESIGNS, ANALYSES, INTERPRETATIONS, CONCLUSIONS, AND RECOMMENDATIONS IN MAJOR MDD PROJECTS. DEVELOP NE AND/OR IMPROVED PROBLEM-SOLVING METHODS AND PROCEDURES TO MAINTAIN MDD STATE OF THE ART. PROVIDE CONSULTING TO MDD TO ENSURE THAT QUANTITATIVE RESEARCH IS PROPERLY DESIGNED AND EXECUTED AND THAT SOUND ANALYSES, INTERPRETATIONS, AND RECOMMENDATIONS ARE MADE AND CLEARLY COMMUNICATED. MARKETING INTELLIGENCE MDD: TOM MILLER END USERS: EXECUTIVE MANAGEMENT MARKETING SALES LAW MDD KEY ISSUE: PROVIDE TIMELY, ACTIONABLE COMPETITIVE MARKETING INTELLIGENCE INFORMATION FOR MARKETING/SALES DECISION MAKING AND MAINTAIN THE INTELLIGENCE CENTER AND DEPARTMENTAL RECORDS. PROGRAMS: MONITOR, COLLECT, AND REPORT COMPETITIVE INFORMATION. DEVELOP ALTERNATIVE INTELLIGENCE SOURCES. RESEARCH TO ASSIST END USERS WITH INFORMATION PROBLEMS. MAINTAIN DEPARTMENTAL RECORDS AND HISTORICAL RESEARCH FILES. MAINTAIN STATUS OF ACTIVE RESEARCH PROJECTS DIRECTOR - MARKETING SCIENCES AND INFORMATION SERVICES JERRY MOORE MRM- MARKETING INTELLIGENCE TOM MILLER SR. MR. ANALYST CAL FAINO MONITOR, COLLECT, AND REPORT COMPETITIVE INFORMATION DEVELOP ALTERNATIVE INTELLIGENCE SOURCES SR. INTELLIGENCE CENTER ADMINISTRATOR ANITA SCISM RESEARCH TO ASSIST END USERS WITH INFORMATION PROBLEMS MAINTAIN DEPARTMENTAL RECORDS AND HISTORICAL RESEARCH FILES MAINTAIN STATUS OF ACTIVE RESEARCH PROJECTS NEW BRANDS AND STRATEGIC RESEARCH MISSION ENSURE THE COMPANY'S STRATEGIC RESEARCH NEEDS ARE MET. AND PROVIDE MARKETING RESEARCH SUPPORT OF COMPANY'S SHORT AND LONG-TERM NEW BRAND EFFORTS. COMPONENTS STRATEGIC RESEARCH PROJECT PLANNING SHORT-TERM NEW BRANDS SPECIALTY TOBACCO PRODUCTS STRATEGIC RESEARCH ACCOUNTABILITY: ENSURE THAT EXISTING RESEARCH IS INTEGRATED AND THAT EMERGING CONSUMER TRENDS ARE IDENTIFIED TO AID AND ASSIST THE COMPANY'S STRATEGIC PLANNING PROCESS. END-USERS: PUBLIC AFFAIRS RESEARCH & DEVELOPMENT SALES MANUFACTURING ESTABLISHED BRANDS MARKETING NEW BRANDS MARKETING EXECUTIVE MANAGEMENT MARKETING DEVELOPMENT PROJECT PLANNING ACCOUNTABILITY: ENSURE THAT LONG-TERM NEW PRODUCT PROGRAMS ARE IDENTIFIED TO MEET EMERGING CONSUMER WANTS AND THAT THE COMPANY WILL HAVE INNOVATIVE NEW PRODUCTS TO MARKET IN THE LONGER-TERM END USERS: PROJECT PLANNING MARKETING/R&D SPECIALTY TOBACCO PRODUCTS ACCOUNTABILITY: DEVELOP AND IMPLEMENT MARKETING RESEARCH PROGRAMS WHICH WILL ENSURE THAT KEY MARKETING RELATED ISSUES ARE IDENTIFIED AND ADDRESSED TO SUPPORT SPECIALTY TOBACCO PRODUCTS BRAND MANAGEMENT IN ACHIEVING THEIR BUSINESS PLANS. END USERS: SPECIALTY TOBACCO PRODUCTS MARKETING/R&D INTEGRATION STRATEGIC RESEARCH FUTURE PERSPECTIVE CURRENT STRUCTURE AND WANTS MARKETING PROCESSES PROJECT PLANNING OPPORTUNITY IDENTIFICATION IDEA GENERATION POSITIONING HYPOTHESIS OPPORTUNITY ANALYSES SHORT-TERM NEW BRANDS PROPOSITION DEVELOPMENT PROPOSITION EVALUATION