Competitor Product Strategy: Dunhill King Size
Were sampled over the period July - August 1986 from the following markets:
Where available, King Size versions have been obtained. Of course, not all brands listed are represented on each market.
A comprehensive programme of data collection is being carried out for each brand and the analysis is scheduled on a one brand per month basis. The programme comprises physical, blend, paper, smoke and sensory testing.
The accent however, is not on data-gathering as an end unto itself, but rather on the insights that can be obtained from the data in terms of the project objectives. For this reason, whilst all the collected data is available in tabular form at the end of GLOBE reports, the text is concise and draws attention only to those areas in which competition thinking and international strategy is illuminated.
A separate report will be prepared on each GLOBE brand. This, the fifth in a series of GLOBE reports focuses on Dunhill King Size, which is available in seven of the markets surveyed.
The key findings from the Dunhill King Size study are the following :
1. Three - UK, Hong Kong and Saudi Arabia of the seven versions tested are manufactured in the UK. Apart from the Saudi product which uses a higher permeability paper, these products are of common construction.
Although clearly there are some construction difference between the non UK -made products (Singapore, Australia, Malaysia, Switzerland) they form a fairly consistent group. The Australian product has a 64:20 mm configuration whereas all other locally-made version use 22mm filters. Densities cover the range 235-270 mg/cc and, not surprisingly, the Australian version is at the bottom of the range. The Malaysian product is also manufactured at a low density (243 mg/cc) whereas the two products - Switzerland, Singapore - from markets where duty and cigarette weight are not related are at the top of the range with densities of 264 and 270 mg/cc respectively. Cigarette pressure drop (95 -116 mm WG) and filter pressure drop (43 - 53 mm WG) are reasonably consistent across markets and, unlike the UK-made versions whose filters have a mixed plasticiser, the local made products use triacetin alone.
Middle East Constraints
2. Often, in the face of delivery constraints, a combination of filter ventilation and filter retention are the preferred controlling factors. In the case of the Saudi product, filter ventilation is not used and filter pressure drop is similar to other UK - made versions.
The Middle East delivery constraints (tar < 15mg, nicotine <1.0mg), which have since changed to a more severe level (tar <12mg, nicotine <0.8 mg), have been met by reducing blend nicotine and increasing paper permeability with respect to other UK-made versions. Thus, these two changes have reduced the tar and nicotine potential of the blend and increased smoke dilution through the extra air entering via the cigarette paper.
3. Density differences, among all versions tested have been mentioned. The UK-made products (containing ~5% expanded tobacco) and the Singapore product (containing ~10% ET) have densities comparable with or greater than the Swiss product which does not contain ET. This might be taken to imply that in the case of Dunhill the full weight - saving offered by ET is not always taken. Preference may be to take at least part of the benefit in terms of physical quality improvement as it is noticeable that the Swiss product performs less acceptably in terms of end stability (0.84 mg/cig) and coal retention (71.1%) than the UK-made and Singapore products. Of course, another implication is that blends prepared for UK-made and Singapore products are of inherently lower fill than the Swiss blend. Australian and Malaysian versions contain -13% ET and are manufactured at densities of 235 and 243 mg/cc respectively suggesting that the full weight saving offered by ET has been taken. Ends stability and firmness data tends to bear out this implication as overall physical quality is far less acceptable than that of all other versions tested.
Puff Number and Pressure Drop
4. Australian Malaysian and Swiss versions demonstrate slightly lower puff numbers than UK-made products and the Singapore version. In the case of the Australian and Malaysian products this is explained by the lower weight of tobacco burnt whereas the Swiss case appears to be a combination of less tobacco burnt (shorter tobacco rod) and higher level of citrate burn additive relative to UK-made products.
Apart from the Australian and Malaysian products, which are manufactured at much lower density than the remainder, cigarette pressure drop (116-139 mm WG) is reasonably consistent across markets, although the Swiss product (106 mm WG) is outside of this range due to its relatively low rod pressure drop (54 mm WG).
So long as cigarettes are manufactured at equal firmness, rod pressure drop increases with increasing inclusion of ET. Clearly, the Australian and Malaysian products (containing -13% ET) are not of comparable firmness but this rule is confirmed by the results from the remaining cigarettes tested.
Dunhill King Size: Cigarette Paper
5. With the exception of the Hong Kong and Malaysian products, versions of Dunhill tested tend to utilize papers with high permeability levels. As a general principle these levels are attained by the inherent porosity of the paper but in the case of the Australian product, secondary ventilation has been added through electrostatic perforation. Thus, through the use of high permeability papers, there is a conscious effort to reduce the weight of tobacco burnt during the puff with a resultant reduction in delivery.
Three products, UK, Saudi and Switzerland, use papers with a chalk loading which tends to be below the normal chalk range 25 - 30% of papers used within the industry. In combination with the higher substance ~28 gsm constant to these papers it would be expected that they would give an advantage over the more conventional papers used on the remaining versions of Dunhill by slightly increasing puff number and, consequently, tar and nicotine delivery.
Without exception, citrate is the preferred additive and levels cover the range 0.49 - 0.88%.
Dunhill King Size: Nicotine and Sugars
6. Blend nicotine is not uniform internationally. As mentioned earlier, the Saudi version, in order to meet delivery constraints, has relatively low total blend nicotine (1.55%). This strategy is in line with previously reported data for Rothmans KS but recent intelligence has shown that both products now use a combination of filter ventilation and filter retention as the preferred delivery control mechanism.
A restriction which influences the blend formulation and, consequently, blend nicotine of Malaysian and Australian produced Dunhill is legislation requiring purchase of local leaf in proportion to market share. Like the case of Rothmans, this has resulted in the Australian version having a relatively high blend nicotine (2.42%) whilst the Malaysian product exhibits a clearly lower level (1.97%).
It is not possible to explain the reason for the wide range (1.66 - 2.42%) of blend nicotine shown by other versions of Dunhill, e.g., Switzerland, Singapore, Hong Kong, UK, but it must be suspected that they are targeted at levels which are intended to suit the requirement of the local consumer.
Blend reducing sugars are reasonable uniform across markets at 12.9 -15.8%. Reducing sugars (7.2 -16.3%) are not consistent across markets in the expanded portion of the blend. However, the products over this range tend to split into two groups. The versions from Singapore and Australia at the top end and the remainder more to the bottom of the range. This tends to suggest that immature higher sugar grades are used within the core blend for expansion in the Australian and Singapore products whereas, over-ripe, lower sugar grades make up the expanded portion in the other products.
7. All versions contain stem but, whilst inclusion level in UK-made versions is -20%, locally made products cover the range 12.2 -15.8%. Reconstituted tobacco is included in all versions of Dunhill tested. UK-made products use paper-type reconstituted tobacco at about 10% inclusion whereas the Malaysian product utilizes recon of a similar type but from a different source and at a much lower level (1.9%). The Swiss product also contains paper type recon at a low level (1.7%) whilst Australian and Singapore versions use band type recon at inclusion levels of 0.3 at 1.7% respectively.
It has long been recognized that the UK and Swiss versions contain a proportion of air-cured tobacco within their blend and, clearly, the relatively high NO delivery of these products helps to confirm this view.
8. On this occasion the Hong Kong and Swiss products are perceived as the most acceptable versions but, of course, judgments on acceptability using the R&D in-house panel are not intended to be predictive of consumer acceptability.
Sensory Correlations Between Products
9. Table 7 shows relationships, expressed as correlation coefficients, which indicate the degree of overall similarity or dissimilarity between all products tested. For instance, it can be seen that the overall most similar pair of cigarettes are two of the UK-made versions, UK itself and Saudi (r=0.75). Malaysian and Swiss products are also highly correlated whilst the most dissimilar products are Hong Kong and Malaysia (r=-0.73) and Saudi Arabia and Australia (r=-0.72).
10. As usual, the smokers perception of draw resistance corresponds closely with the machine measured total PD values. Consequently, UK-made products along with the Singapore version are perceived as having a clear resistance during puffing whereas the Malaysian and Australian versions are relatively easy draw products.
As would have been expected from its relatively low smoke delivery the Saudi product exhibits overall lower intensities of sensation than all other products tested. However, the other two UK-made products occupy a similar region of sensory space; likewise the Singapore product.
Prior knowledge and the NO delivery figures suggest that air-cured tobacco is used within the blends of the UK and Swiss versions. Consequently, it is no surprise to find air-cured character identified in the sensory properties of these products. Also, it is not unusual for air-cured character to be identified in Malaysian flue cured products as local leaf tends to give a distinctive musty sensation which can be confused with the similar musty character of air-cured tobacco. However, no reason can be given for smokers identifying air-cured character in the Saudi and Singapore products.
The importance of delivery per puff to the smoker is best illustrated by the overall high intensities of sensation given to the Malaysian, Australian and Swiss products.
The data within Tables 6, 7 and 8 are represented as a two-dimensional diagram showing the "best-fit" disposition of the parameters and seven products. In this plot, 82% of the total variance in the data is accounted for by the first two principal components. In this situation firm conclusions should be drawn from the Tables, but the plot effectively gives an insight into possible trends in the data.
For instance, the plot suggests that products from Saudi, Hong Kong, UK and Singapore have low intensities on all but the draw resistance parameter and, of course, this is the case. The converse is evident in respect of the Malaysian, Australian and Swiss products and, overall, the cigarettes have separated into two loosely arranged groups of similar sensory characteristics.
Dunhill King Size: Summary Statements
Current Competition Thinking on Product Design.
1. There is some consistency in paper policy. Although permeability covers a wide range a preference is shown for high levels. Citrate is the preferred additive at levels in the range 0.5 -1%.
2. Ventilation is not used even in delivery control situations.
3. Triacetin is always used as the plasticiser on locally-made versions whereas UK-made products use 1:1 triacetinrtegda.
4. Expanded tobacco, stem and reconstituted tobacco are used in combination except in the case of Switzerland where expanded tobacco is avoided.
5. Paper type reconstituted tobacco is most often used.
6. In delivery control situations, the policy is to reduce tar and nicotine potential through blend formulation and dilute smoke by air entering via the cigarette paper.
Strategic Differences in the Product Offer to Different Markets.
1. Some product consistency does exist across markets with the greatest degree of modification in response to local regulations.
2. Saudi, Australian and Malaysian versions have all been adapted to suit some legislative requirement of the market, i.e., Saudi Arabia - delivery control; Australia - weight control; Malaysia - local leaf usage.
3. In sensory terms this has meant that the products split into two discreet groups which suit market norms and consumer expectations.
4. Apart from the consistent level of paper type reconstituted sheet in UK-made products, there is no overall clear policy for reconstituted tobacco inclusion.
5. Apart from Switzerland, expanded tobacco is consistently used, but, core blends tend to vary in maturity of leaf as shown by the differences in sugar level.
6. Ventilation is not seen as a necessary requirement in the design of Dunhill. However, recent intelligence has shown that ventilation is now preferred in delivery control situations (Saudi).
Similarities and Difference in Product Design between versions of Rothmans KS and Dunhill KS common to both globe reports.
1. Blend construction within markets is very similar although Australian and Malaysian versions of Dunhill contain somewhat more stem than their Rothmans counterpart. Also, NO data tends to suggest that UK Dunhill contains some air-cured tobacco whereas UK Rothmans is a flue-cured Virginia only blend.
2. Both brands have the same plasticizer policy. UK-made brands use mixed plasticizer whilst locally made brands use triacetin alone.
3. Papers used on versions of Dunhill always have citrate as the burn additive whereas the preferred additive for all UK-made versions of Rothmans, apart from Saudi, is phosphate.
4. With the consistent exceptions of Australia and Singapore, both brands are using over-ripe, low sugar grades in the expanded portion of the blend.
5. In delivery control situations, i.e., Middle East, the strategy for both brands is to use a blend with low tar and nicotine potential (low blend nicotine) and not to use filter ventilation and filter retention as the preferred controlling factors. However, recent intelligence has shown that both brands now use filter ventilation as a means for controlling smoke tar and nicotine levels.
6. For both brands, Saudi, Australian and Malaysian versions have been adapted in the same manner to suit some legislative requirement of the market, i.e., Saudi Arabia - delivery control; Australia - weight control; Malaysia - local leaf usage.