SWoT

GOLD FLAKE









CHAPTER VII









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GOLD FLAKE







SWOT ANALYSIS









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GOLD FLAKE





STRENGTHS





1) The main strength of the company is the brand Image of Gold Flake. In spite

of ban on the advertisement the product was at No.1 position in FMCG

products in 2003-2004 and its sales were up to Rs 3900 crores.





2) The attributes of the product is as per the consumer aspirations,

specifications and taste. It has high perceived quality; it is affordable by the

consumers. This factor has helped the company to keep steady margin of its

sales volume.





3) The company has an excellent distribution channel of network which has

enabled the availability of products in different regions as per the consumer

demand and supply for the product.







4) The Gold Flake brand name has been promoted through vacation tours

“Gold Flake Golden Getaways”. ITC has also paid Indian tennis stars to

endorse Gold Flake cigarettes.



5) In Mumbai, Goldflake from ITC holds the lion's share of the market

selling 60 million sticks. Four Square special comes second with 55 million

sticks and Wills is third









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WEAKNESS





1) The main weakness of the company is that after the ban on advertisement it

is not able to promote the product on higher basis as it was promoted before

the ban.





2) The other weakness is the manufacturing process which is very time

consuming. Sometimes it is very difficult for the company to supply the

cigarettes as per the demand; it is because the demand of Gold Flake is

increasing rapidly.





3) Most the times the consumer prefers the price of the product first and then

the quality and other factors. The price of Gold Flake is Rs 34/- therefore as

a high price product the quality is ignored by the consumer and then they

prefer to buy „bidis‟ or „pan‟.





4) The next weakness is that the company is not able to build a further brand

image due to the ban on advertisement. The branding of the company is done

on small basis which is hardly ever seen.





5) ITC not only manufacturers Gold Flake but also Wills Navy Cut, Bristol,

Four Square etc. It becomes difficult for the company to differentiate and

decide the quality, price and other factors of the cigarettes while

manufacturing and distributing.









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OPPORTUNITIES





1) The opportunity of the company (ITC) is to reduce the price of the product

and offer the same quality. This will increase the sales volume of the

company.





2) The packaging of the product should be changed and each and every

attribute should be mentioned on the packet and also the level of harmless

should be mentioned. This will help in „Word of Mouth‟ marketing.





3) As ITC is being recognized as World's Best Big Companies and the World's

Most Reputable Companies by Forbes magazine, the company can launch

Gold Flake at international level through collaboration with sports events

held at international level and also with other brands.





4) In India the company can launch the product Gold Flake as mild cigarette

and less harmful for consumer attraction.









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THREATS





1) The threats of the company are competition from international companies.

The main competitors are Marlboro, Marlboro Lights, and 555 cigarettes.

These companies are famous at international level and also as an imported

cigarette brand with affordable price; the consumers prefer to buy them.





2) The promotion done by the company of Gold Flake is through

advertisements in magazines and sponsorship, where as the advertisement of

the international companies like Marlboro and Camel is done on

international level, like sponsorship to Ferrari team in Formula One and also

to Super Bike racing. Camel cigarettes give sponsorship to Rally Races in

Africa and UK. This is the biggest threat to the brand image of the company

at national as well as international level.





3) The next threat may also be the changing habits of the consumer; they may

quit smoking due to its ill effects and hazards. This may affect the sales as

well as the brand image of the product









4) In future the government may completely put ban on advertisement of

cigarettes or also put a ban on sponsorship under the consideration that

cigarette is harmful for health. This will be the biggest threat for the product

as well as the company.









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