Global Strategic Management: Analysis of British American Tobacco's Strategy

This report analyzes the existing strategy of British American Tobacco (BAT) with external and internal environments, and recommends improvements for successful business. It also discusses different contemporary strategic issues and analyzes Porter's five forces and blue oceans in the project.

GLOBAL STRATEGIC
MANAGEMENT

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Presenting strategy used by British American Tobacco..............................................................3
External Analysis.........................................................................................................................3
Organization could Improve their strategy..................................................................................6
Different component strategic issues...........................................................................................7
Levels of strategy.........................................................................................................................8
Porter's five forces of company...................................................................................................8
Blue ocean strategy....................................................................................................................10
RECOMMENDATION.................................................................................................................10
CONCLUSION..............................................................................................................................11
REFERENCES................................................................................................................................1

INTRODUCTION
Global strategic managements is appeared from the accumulation of globalization and
implications on the business world. Global strategic managements is important for allow to
diversify the business risk that includes their operational risk and economic risk. This strategic
managements help in gain the competitive advantages. The global strategic managements ids
achieve the vision of company and promote the well-being of organization. British American
tobacco company is the world international tobacco group and British multinational company at
London, United kingdom. The company manufactures and sells the tobacco, cigarettes and other
nicotine products. This report will discuss the existing strategy of company with the external and
internal environments as well as negative and positive impacts of current strategy (Campá
García, 2019). This report will elaborate the improvements for the strategy by organization,
recommendation for changes for successful business with justification. This report also discuss
the different contemporary strategic issues and analysis the poster's five forces and blue oceans
in the project.
MAIN BODY
Presenting strategy used by British American Tobacco
British American Tobacco (BAT) is British multinational company that sell and
manufacture tobacco and nicotine products. The organization was first established in 1902 and
the headquarter is located at London, England. Thus, it is one of the largest tobacco company in
the world based on net sales as well as it cigarette brands include Dunhill, Kent, Lucky strike and
Pall Mal. The brand includes Vuse, Vype and GIo as well as BAT primary has been listed on the
London Stock Exchange.
External Analysis
PESTEL
Political: This factor is consisting of rules and regulation made by the government in order to
maintain the smooth flow of business in market area. Along with this, British American Tobacco
is closely follow the states and territories polices (Thomas and et.al., 2021). Although from lower
taxation policy company has been benefited and that has resulted in high profits as well as firm
has invested in research and development so that it can make environmental products.

Economic: Due to pandemic there has been impact on customer disposal income and due to that
there has been change in their purchasing cycle and it has negatively impacted consumer and
company revenue. Moreover, government intervention in non-cyclical sector in Tobacco industry
can impact the fortune of consumer spending behaviour.
Social: The organization basically targets young customer in order to run their organization as
well as consumer nowadays prefer experimental products instead of traditional value proposition
in non-cyclical sector (Capobianco and et.al., 2021). Moreover, for understanding societal
norms firm should set local team to serve quality services to customer.
Technological factor: The organization need to make use of digital media in order to promote
their products and services in the market area as it will enhance the sales through attracting large
customer. Along with this, making use of advance technology means lower supply chain and
greater access to information that helps in finding innovative idea to deal with challenges.
Environmental: The organization is trying to prioritize environmental norms so that can give
their contribution in development of society (Shahid, 2022). Along with this, it will be
manufacturing products according to environmental designed and standards rather than catering
to traditional value. The company is following CSR strategy in order to build awareness in the
market area.
Legal: The company is following rules like employment law in order to give legal protection to
employees so that it work safely. Along with this, it taken copyright for the company so that no
one can make misuse of the brand.
SWOT
Strength: The company has good brand image in the market area and it has helped in increasing
overall sales of the organization in positive way. Along with this, due to good brand name it has
best customer base than other competitors (Benzaghta and et.al., 2021). The organization have
good marketing mix and due to that it is able to cater various customer’s segments in the
Tobacco industry.
Weakness: High competition is the major weakness of the organization and due to that it has to
invest more in innovative ideas in order to increase profitability (Djellabi and et.al., 2021).
Opportunity: The company has online service opportunity so that it can offer customer good
services to their customer as well as expand their business in positive manner.

Threat: BTA high employee turnover of employees and due to that organization is facing loss.
So in order to improve that company need an innovative idea so that it can improve human
resources challenges (Büyüközkan, Havle and Feyzioğlu, 2021). Moreover, changing political
environment of countries like USA, China and European Union has impacted local and
international market.
Furthermore, British American Tobacco is making use of experimental marketing
strategy that helps in engaging with the customer. Along with this, it enables customer to buy
products and services from the company as well as to experience the brand (He, Zhu and Zhao,
2021). Moreover, in this strategy an emotional connection is established with the customer
through making use of different experimental activities like customer engagement and it also
improves the process. This tactic is also known as engagement marketing as it helps customer to
connect with brands as well as main objective of marketing strategy is to foster consumer loyalty
and enhancing their life time values. Some of the experimental marketing strategy is to evaluate
and determine approaches to identify outcomes and select the best way to maximize online
engagement through various social sites.
Pros:
It helps in personalizing engagement with the customer that helps in increasing the
overall sales as well as to build good brand image in the market area. Although if good
connection is established with them than their loyalty towards brand is decrease which helps in
reducing competition and enhance brand value.
It contributes in increasing brand awareness and social media engagement as well as creates
unique and memorable experience through making use of various social sites (Wang and et.al.,
2021). Along with this, social media allows firm to identify taste and preferences of the customer
and it provides important information regarding market condition that experimental marketers
can make use of in order to improve firm’s performance. Thus it is one of the best way to engage
with customer and enhance the credibility.
Cons:
It is very expensive in nature as it requires skill full employees that can come up with
innovative ideas to engage with customer as well as to understand their interest (Daoust and
et.al., 2021). Although if company do not have good financing then it will not be able to hire

intellects that will create live model of marketing which will contribute in completing the task on
time. thus, lower finance will affect the success of campaigns.
Another issue that company will face is it will be hard for the employees to predict how their
customer will react and weather customer is able to understand products details properly.
However, if company is not able to deal understand the needs of their audience then their
campaign will fail and it will result in poor branding of company.
Organization could Improve their strategy
In the context of experimental strategy, BAT should capture the new plans for the
customers attention and engagement as well as helps in the best experience of customers with
brand. There are various improvements in the strategy which must adopt by the company.
 Know customers journey: Company can know the journey of customers and know who
is company customers and how they are engaged with the brands (Bindra, Parameswar
and Dhir, 2019). Company can start with map the journey of customer and find the all
challenges of customers.
 Build customers loyalty program: it is the most effective ways to improve the
experimental strategy for the customers engagements and it is the best engagement's
strategy. This can include the incentives to rewards the loyal customers, gifts, discounts,
and many more (Westney, 2021). It helps in boost the brand loyalty.
 Personalization: company can offer the personalization services to customers for
improve the experimental strategy. With the helps of machine learning the company can
easily engage with the customers at the personal level as well as offer the relevant and
quick services (Bleier, Keyser and Verleye, 2018).
 Chatbot: BAT can implement the chatbot because it helps in analyze the data of
customers and easily speak to customers as well as it helps in recommend to customers
about the products and helps them to choose products. It is the best and smart for the
customers engagements because it works based on the customers needs. It helps in grab
the attention of customers and handle the routine questions of customers (Ferdous,
2018).
 Visual engagements tools: Company can use the visual engagements tools for better
interaction with customers because it helps in create the better human experience. There

are various visual tools that includes the cobrowsing, mind mapping, video chat, etc. that
all technology helps in improve the customer's interaction in real time. In mind mapping
software, it helps in develop the visuals ideas and easily develop the relationship with
customers (Ndegwa, 2019). Video chat helps in build the communication with the
customers and it is the advantage features.
 Conversational service: company can offer the conversational services to customers for
the better engagements and attract customers as well as it helps in build the long term
relationship. It helps in build out the competitive advantages for company.
 Support team: Company can support the customers services teams. BAT company can
provide the training, motivation, rewards systems to them that helps in deliver the bets
services to customers and engage with customers for life as well as helps in create the
customers experience (Zanatta, 2019). This also helps in improve the experimental
strategy for the better customer's interaction to deliver best experience.
Different component strategic issues
There are various component strategic issues in the experimental strategy that includes
the expectations, new communities, new models of authority, distracted, etc.
 Customers distractions: In modern trends, customers are increasing distracted and it us
the major issues in experimental strategy and it cut the value of business with the
customers and it affects by the repeated interaction with customers and it helps in build
the strong emotions and physical investments a consumer has in company brand (Volik
and Kovaleva, 2020).
 Expectation: the customers expectations are increased with the modern era and it is the
big issues for the company so, BAT needs to interact with customers for met the
preferences and relevance of customers, and they should time spent on customers to
know them better and understand and frame a personalization with the customers to
understand the customers expectations.
 Listen to new authorities: customers get interact with the other's authority with the
helps of websites and it is the big issues in the experimental strategy so, company need to
offer free expert advice to customers (Kohtamäki, 2020).

Levels of strategy
There are three types of strategy that includes the corporate strategy, business strategy
and functional strategy.
 Corporate level strategy: This strategy apply in organization for increase the
competitive advantages through the management and selection of collection of
organization competing in the products markets and several industries (Mahmoud and
Lehtonen, 2020).
 Business level strategy: Business strategy is refers as the collection of moves and
actions which are taken with objective of delivering values to customers and it helps in
maintain the competitive advantages.
 Functional level strategy: This strategy is plan of action to success the routine, short
term and day to day business objectives and goals to support the business and corporate
level strategies. It helps organization to manage the operational activities on a routine and
daily basis.
Porter's five forces of company
It is the strategic managements tool to analyze the business and understand the
profitability of company. The company managers can use porter five forces understanding and
determine the competitive forces which helps in influence the profitability and develop strategy
for increase the company profitability and long term profitability. The five forces includes the
threats of new entrant's, bargaining power of suppliers, buyers, threats of substitutes and
competitive rivalry. It is the holistic strategy framework which helps in build the sustainable
competitive advantages.
 Threats of new entrants: Company have a large competition in the tobacco industry so
there is the low entry of new threats at United Kingdom. But the barriers in the national
and global level is high. BAT company is the largest operating company. The new
entrants of company is households and personal good brings innovation and that put the
pressure on the company with the low pricing strategy and offering the new value
propositions to customers (Trim and Lee, 2021). BAT company can tackle the threats of
new barriers with the helps of innovation in products and services because it helps in
brigs new customers as well as retain the existing customers. Company can spend money

on research and developments and build new capacities. In further illustration, it difficult
for the others new entrants to achieve the economic scales so, the company have the low
and medium Threats of new entrant.
 Threats of substitute products: For the BAT company, threats of substitute product's is
low because as regarding the smoking there is the no substitutes products in the
traditional sense as well as it is equivalents to the price (Soltani, 2018). It difficult for the
substitute company to manufacturer the products and compete with the prices which are
set by the economics so, its difficult for the other company because tobacco is not
necessary for life and it attracts substitutes can be medicines which are effectively
available in markets for the smokers to avoids tobacco. The British American company
can easily tackle the threats of substitutes products with the helps of switching cost for
consumers and understanding the core needs of consumers.
 Bargaining power of buyers: The company have the low bargaining power of buyers
because of the addictive nature of brand as well as they want to buy the best offering
which are available at the minimum prices. The company have the high ability and
capacity to want enhance the offers and discounts. BAT can tackle the bargaining powers
of buyers with the helps of build the large base of customers and innovate new products
to attract the customers.
 Bargaining power of suppliers: Bargain power of suppliers is low because the products
of company like nicotine and cigarette producing require the raw materials from the
farmers for manufacturing and farmer have the high negotiable power that why the
company have the Low bargaining suppliers. So, the company needs to maintain the good
relationship with the suppliers and farmers for raw materials and it directly impacts on
the profitability of company. The business can tackle the bargaining power of suppliers
with dedicating the developments of business to the suppliers of company as well as
company can build the efficient supply chain.
 Rivalry competition: The industry have the high competition in tobacco industry
(Dockner and Jørgensen, 2018). The company merged with the imperial tobacco
company for improving the marketing competition and reduce the level of competition
and company compete with the high competition. The company can tackle the

competition with the help of focus on research and developments for innovate produce
and then gain the competitive advantages in marketplace.
Blue ocean strategy
Blue ocean is referred as strategy to markets for the company products where hare is less
competition and no competition. This strategy includes the sequence which must be builds by
company in their blue ocean strategy such as buyer utilities, price, cost and adoption. It helps in
build the various variables business models ans it helps in ensure the business profits (Au and
Tucker, 2018). It is bets in the industry. If the company is running with the existing strategic
business that the blue ocean strategy can be prepared with the other models which are most
important for business profitability. Some examples: blue ocean with balanced scorecard, blue
ocean with SWOT. It is the best opportunities for business to attract the customers and develop
organization.
RECOMMENDATION
The company should change the customers feedback managements services because it
helps in build the relation with customers and correlate with the customers satisfactions and
business outcomes. The customers feedback also helps in define the customers behaviours
regarding the business. It helps in sustain the business for the long term. Company should change
the customers advisory boards because it helps in enhance the customer's loyalty, gather
invaluable feedback and helps to organization a cutting border in space (Vinerean and Opreana,
2021). It is the powerful tool and CAB helps in guide customers experience, learn more about
audience and ready for product launch. It is effective and flexible for customers and adapt variety
of business goals. Company should change a customers community on social media platforms
because customers are sources of experience and relevant information.
This community helps in engage with customers and share information such as new
courses, updated products and programs for the customers. It is the amazing way to interaction
with customers and inspire the loyalty in customers as well as helps in improved the various
things related to customers within organization. BAT company should change the rewards
engagements programme for customers. They should commit with customers regarding the
customers loyalty and it helps in increase he customers engagements. There are various types of

rewards such as certificate. Prizes, gifts, offers and discounts. It helps in attract more customers
towards the business and increase the retention rate of customers.
CONCLUSION
As the conclusion, the global strategic managements is referred as the business
management's strategy which helps in handle and mange the business performance. This helps in
achieve the business objectives and goals for the profitability and productivity of organization. It
helps in develop the competitive opportunities. It is the process of coordination, designing a
coherent which helps in set the degree which helps in business globalize its strategic behaviours.
BAT is British multinational company which operates the cigarettes, tobacco, etc. BAT company
is the largest tobacco company in the world and it based on the net sales.
In the conclusion, This report discussed the external and internal environmental factors
and existing strategy that is experimental strategy for the customers engagements with the
advantages and disadvantages of strategy. This also identify the improvements which could by
organization in their strategy. This report elaborated the theories that include the porter five
forces and blue ocean. This also discussed the component strategic issues and level of strategy as
well as recommend the changes in the strategy of organization.

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