Souza Cruz Competitor Analysis - 2nd Quarter 1993

This article is part of the Tobacco portal on Sourcewatch funded from 2006 - 2009 by the American Legacy Foundation.

Souza Cruz Competitor Analysis - 2nd Quarter 1993

This competitor analysis by the Brazilian tobacco company Souza Cruz (stamped "secret") discusses the behavior of the Philip Morris tobacco company in Latin American markets. It shows how cigarette companies try to out-compete each other by introducing new brands into the DNP ("Duty Not Paid," or smuggled market) to undercut the market share of other companies. In this case, Souza Cruz observed that Philip Morris was flooding the market in Paraguay "basically with the aim to increase its share of the DNP...segment." The document further observes, "This is a clear strategy PMM is adopting as a way to increase volume and share in the recessionary Brazilian Market...The growing presence of PMM's brands in the DNP market confirm its determination gaining market share...PMM may follow another possible strategy to increase its market share: the full utilization of the DNP segment to launch international brands (L&M family and Lark)."

The report also reveals that the introduction of a single new brand of cigarettes into a country can open the floodgates to more cigarette brands entering the country through both the legitimate and smuggled markets, as cigarette companies compete to obtain market share.

The term "transit" also refers to the smuggled market.

Title: Souza Cruz Competitor Analysis - 2nd Quarter 1993
Author: unknown
Document date:19930908
Page count:7
Bates number:202724746-202724752
URL: http://bat.library.ucsf.edu/tid/mqm80a99