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Introduction Of Phillip Morris Case study Help

Phillip Morris is a multinational tobacco company that is based in America. The company sells its products all over the world in approximately 180 countries. The bestselling and most famous product of the company is Marlboro. The company is referred to as one of the companies that contain Big Tobacco. Until March 2008, Philip Morris was known as the operating company in Altria (Philip Morris International 2022b). The legal seat of the company is in Stamford, Connecticut. However, the company is not operated by this legal seat in the United States of America. As tobacco is known as an addictive agent and one of the major causes that cause preventable deaths globally, the contribution of the company to the welfare of society is controversial. The company is the subject of litigation and restrictive legislation from governments. 

Introduction Of Phillip Morris Case study Help

Vision and Mission Statement of Phillip Morris

The mission of Philip Morris is to be a good corporate citizen and a good employer. Phillip Morris attempts to be socially and environmentally accountable. The company fights the illegal trading of cigarettes. The mission of Philip Morris is to support the communities where there is a source of tobacco and where the employees of the company work and live. The Vision statement of the company is to build smoke-free products and a better choice than smoking cigarettes (Philip Morris International 2020a). Millions of men and women who become addicted to cigarette smoking suffer from various health complications. Therefore, Philip Morris will give a product to the customers which are less harmful and a better alternative to cigarette smoking. The mission of the company is to design a smoke-free future and build a healthy society. The product of the company is enjoyable and smoke-free. Philip Morris aims to replace cigarette with a portfolio of revolutionary products. 
Vision Statement: “We are delivering a smoke free future”.
Mission Statement: “Our Mission is to build a smoke free future: a future in which all adult smokers who do not quit switch to new some free products  and abandon cigarettes.”

Vision and Mission Statement of Phillip Morris

Phillip Morris Situation analysis

The business is attempting to move away from smoke and toward smoke-free products. They are putting into place laws and regulations that contribute to the development of smoke-free goods. The organization hires the greatest candidates and provides them with the best working environment since they work for their employees (Fern Fort University 2022b). The business values openness and development, and when making important choices for the business, they consult with their stakeholders. The organization's 2030 goals include creating a climate for just globalization.

 Industry Structure and Economic Feature

A small number of businesses that grow, sell, and market tobacco and associated products globally make up the tobacco industry. Due to the magnitude of the necessary distribution networks and governmental limitations on marketing and promotion, there are significant barriers to entry in this sector (Philip Morris International 2022b). The opportunity for future expansion in this highly developed sector will be constrained by these limits, which are the result of health warnings. By utilizing economies of scale, businesses frequently employ mergers and acquisitions to expand internationally and reduce expenses. The supply chain is generally under their control from production to distribution because they frequently integrate vertically. These elements make the market an oligopoly, which fits the definition. 
With a 50% market share in Singapore, the manufacturer PM intends to launch a new, improved cigarette there. The item is known as the "Marlboro Switch." Smoke and odor will be lessened by this cigarette's less hazardous constituents. Smokers will have a unique experience because of the three diverse flavors it offers. By flipping a switch, the taste may be switched from regular to menthol, giving smokers the pleasure of savoring two flavours in a single cigarette (Philip Morris International 2022b). The item will be offered for sale in enticing and practical packaging that includes a space for a lighter. The product will be distinctive, fashionable, and convenient because it will allow customers to carry the lighter in addition to the packing.

 Phillip Morris Strategic

i)    Business Level Strategies
The company can more quickly realize our goal of a smoke-free future if science and innovation are allowed to lead the way, and with the correct regulatory support and civil society support. In the organization, the gold standard for equality is equal pay for equal labor for men and women. By receiving the Global EQUAL-SALARY Certification, we have verified that our real pay practices align with our noble ideals.  Independence and non-profit status define the EQUAL-SALARY Foundation, which has its headquarters in Switzerland (Philip Morris International 2022d). The EQUAL-SALARY Certification confirms that businesses have sustainable policies and procedures in place to make sure they pay male and female employees equally for equivalent work. Acquiring EQUAL-SALARY accreditation is a crucial step toward developing a workplace that is more gender-balanced and inclusive.
ii)    Corporate Level Strategies
The main goal of the company is to foster a work environment where our international staff members can be authentic and give their best while also supporting one another and fostering the innovation and customer-centricity that will enable us to realize our vision of a world without smoking (Philip Morris International 2022d).

Competitive analysis and advantage in the industry

The business is securing its future by focusing on smoke-free goods, which provide adult smokers with a much superior alternative to continuing to smoke. Philip Morris will continue to rely on its strengths in creating outstanding brands, coming up with new ideas, and exceeding consumer expectations.

 SWOT analysis


The strength of Philip Morris is a reliable network of distribution that can help the company to reach the potential market. Philip Morris is investing a large resource that is essential for the training and development of the employees. The outcome of this training programme is a highly skilled and motivated workforce. The company is successful at the effective execution of the strategies that assist in good returns on capital expenditure (Fern Fort University 2022b). Philip Morris has a strong brand portfolio. It has a strong base of suppliers of raw materials. The customer relationship management department of the company is another major strength of the company via a high level of satisfaction among the customers.    Weaknesses
The company is not good at forecasting the demand for the products which leads to an elevated rate of missed opportunities for the company. The structure of the organization is only compatible with the present business model limits the expansion of the company in the adjacent segments of the product. The financial planning of Philip Morris is not done efficiently and properly. In comparison with others, Philip Morros higher rate of attrition. The company needs more investment in new technology. One of the major weaknesses of the company is there are gaps in the range of products that are sold by the company. The lack of choice increases the scope of the new competitor to get a foothold in the market (Fern Fort University 2022b).


Opportunities for Philip Morris are the invention of new technologies that will provide great services and attract new customers; new trends in the behaviour of the customer; core competencies of the organization are one of the major opportunities of Philip Morris. Environmental policies and market development will assist the company to improve its competitiveness in comparison with the other companies in this industry (Fern Fort University 2022b).    Threats
The threats are increased pay levels, the increased value of raw materials, new technologies that are developed by the competitor, new environmental regulations, and fluctuation in currency (Fern Fort University 2022b). 

 PESTLE analysis

Political   - Political factors that have an impact on Philip Morris are the political stability of the country, corruption level, risk of invasion of the military, interference in the industry of the cigarette by the government, intellectual property protection, regulation of trade and tariffs that are related to the goods of the consumer, antitrust laws that are related with cigarettes, regulation of pricing, rate of tax and incentives, industrial regulation of safety and others (Fern Fort University 2022a).

Economical   - Type of economic system in the countries, the intervention of the government in the free market, rate of exchange of the host country, financial market efficiency, skill level of the workforce, cost of labor, rate of unemployment in the country, economic growth rate, rate of interest and others (Fern Fort University 2022a).

Social  -  Social factors are the structure of the class, level of education, culture, attitudes, and leisure interest of the society (Fern Fort University 2022a).

Technological   -   Technological factors that have effects on Philip Morris are the technological development of the competitors, the impact of the technology on the product offspring, and the technological diffusion rate (Fern Fort University 2022a).

Legal  -  Important legal factors in this context are consumer protection and e-commerce, discrimination law, employment law, the law of protection of data, and law regarding health and safety (Fern Fort University 2022a).
Environmental  -  Environmental factors are weather, change in climate, laws regarding pollution of the environment, pollution of air and water in the industry of cigarettes, attitudes towards renewable energy, and attitude towards ecological products (Fern Fort University 2022a).

Target Market Analysis of Phillip Morris

i)    Demographic Characteristics of Market: The demographic characteristics of the market of Philip Morris are young adults.
ii)    Psychological Characteristics of the Market: Asking for a smoke-free future
iii)    Behaviors of the Target Market: Philip Morris will give the product to customers which are a less harmful and better alternative to cigarette smoking
iv)    Strategies of the Appealing Market: Responsible marketing and sales for PMI include commercializing the goods in a way that restricts access to and use by unintended users, such as minors and non-smokers—both those who have never smoked and those who have given up smoking (Philip Morris International 2022c). Additionally, it involves spreading the word about healthier alternatives to cigarette smoking to adult smokers (or users of nicotine-containing products). While doing this, clearly communicate the health hazards associated with the products through the use of appropriate labelling and communication.

Marketing Mix of Phillip Morris

i)    Product Strategy: The product will be smoke-free which will be a better choice than cigarette smoking.
ii)    Pricing Strategy: The price of the products should be such that they will be affordable and accessible to all the customers who need them.
iii)    Promotional Plan: Only adults who smoke or use other nicotine-containing consumer goods should use PMI products. The company alerts customers to produce health effects. To help adult consumers make decisions, they communicate information about the products. The business markets honestly and openly (Philip Morris International 2022d). They create things, develop them, and market them in ways that are consistent with the smoke-free purpose.

Philip Morris competitive analysis

i)    4p’s comparison with the competitor: It will explain the set of activities that Philip Morris uses to improve the strategies of marketing. The outcome of this condition is the development of a differential positioning in the marketplace of the company.
ii)    Product: The product is not seen as a physical good in marketing strategy; rather, it is seen as the source of value to be provided to the customers. Morris Philip offers value to its clients in a variety of ways, including quality-assuring brand recognition, point of sale equity, installation and maintenance services, word-of-mouth recommendations, pre-purchase education and priming from the sales personnel, financing options for the items, ease of availability, the physical product itself, and more (Philip Morris International 2022c).
iii)    Price: Philip Morris examines a variety of pricing strategies, such as cost-based pricing, where the business places a markup based on profit upon the cost of producing the product. Value-based pricing is based on the values that customers believe in. The company prioritizes cutting-edge items and strong brand recognition when setting prices.
iv)    Place: To fulfil the company's vision, distribution and marketing channels are crucial. The result is providing clients with information about the products, their accessibility, and sales services.
v)    Promotion: To improve client communication, Philip Morris uses all available communication channels, including advertising, personal selling, direct marketing, sales promotion, and public relations.
vi)    Strength comparison with the competitor: The company has an advantage as the first mover, has a successful record for consumer-driven innovation, strongest market leadership innovation, wide geographic position, and strong brand recognition in the tobacco industry (Philip Morris International 2022d).
vii)    Weaknesses in comparison with the competitor: The loyalty of the company among the suppliers are low, decreased market share of the company with increased revenues, and poor investment in the customer care services of Philip Morris.
viii)    Organization’s competitive advantage: Preference of the customer, increasing regulation of the government towards unauthorized players in the industry of tobacco, scopes in online space and others.

Key success factors

Key success factors are lifestyle research, brand studies, and effective communication.

Problems and issues in Philip Morris’s organization 

lack of loyalty, and a poor business model that can be imitated by other competitors.

Financial analysis

Compared to the severely disrupted prior year, the industry background improved in 2021, but pandemic-related issues persisted in several markets and the operating environment remained unstable as evidenced by the disruption in global supply chains (Philip Morris International 2022b). In comparison to 2020, the total volume of the global cigarette and heated tobacco unit (HTU) industry climbed by 2.4%, mostly due to rising social occasions and improved mobility, which supported volume recoveries across several regions.

Conclusion Of Phillip Morris Case study

The production and marketing of cigarettes, smoke-free products, related electronic equipment and accessories, and other nicotine-containing goods are the main activities of Philip Morris, a major global tobacco firm. While there are risks associated with using smoke-free goods, PM is securing its future on the premise that they are a far better alternative to continuing to smoke.

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