In the paper “Customer Retention Activities” the author compares the recession and intense price war between Phillip Morris and Marlboro. Marlboro required gaining a long-term market share and profitability growth in a responsive market share environment…
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In the year 1981, Liggett introduced generics to boost market share. The market competitors of Morris were RGR as the brand used to sell branded cigarettes comparatively cheaper through cheap resources and advertising fees. RJR had the leading market share within the industry due to its adopted price-cutting strategy.
The price cutting discounted strategy actually has helped the organization to regain the faith and trust of the loyal existing customers. It is true that recession has affected the sales growth rate of the organization. In an addition, affected purchasing power due to economic recession influenced several consumers to avoid the purchasing of the expensive premium branded cigarettes and buy cheap economic priced cigarettes. Therefore, discounted pricing strategy or price-cutting strategy has helped Marlboro to support the affected purchasing power of the target customers. Therefore, it has helped the organization to increase its market share significantly.
Discounted pricing strategy or price-cutting strategy can affect the brand image of Marlboro among the customers. It is one of the leading organizations within the industry. In addition to this, low pricing can create a negative perception in the minds of consumers regarding the quality of the product. Drastically too much discount can force the customers to think about the fall of quality of products. It can cause reduce sales growth rate of the organization.
Marlboro Man has become one of the major advertising or promotional campaign that helped the organization to become one of the leading organizations within the industry. Most importantly, promotion can be considered as one of the important strategic marketing tools that can help an organization to create effective brand awareness among consumers.
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“Customer Retention Activities Case Study Example | Topics and Well Written Essays - 750 Words”, n.d. https://studentshare.org/business/1675736-case-study-discounting-the-marlboro-man.
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