Note from Nominator 

Affiliate finance team played a pivotal role in the launch and expansion of Marlboro Compact along with margin enhancement.  They were involved from day 1 in the project – through insights and analytics on industry, landscape, pricing and margin they drove data driven decision making in the team. They challenged the team as required, recalibrated investments in areas to maximize return. Influenced commercial team and jointly came up solutions to enhance margin by building the trade offers in the pricing in a way which ensured tax efficiency and at the same time improved margin. 

Result of teamwork, now we have a SKU which in just 2 years after launch represents 1/5th of volume and has added more than ~$10 mio in the topline in the year 2021, and continues to grow double digit. 

Introduction of the Team and Project 

India Project Team constituted Shray Mehandiratta, Mayank Agarwal, Rahul Agarwal, Niralee Nagda from Finance and worked in tandem with Business Commercial Team. 

The voyage began in Jan’20, where the Business decided to enter RF high segment (69mm) and build a safety net to gain from King Size (84mm) down-trading. To seize this opportunity, a cross functional team including Finance was set up to embark on the journey of launching Marlboro Compact.  

Finance team played a pivotal role in defining the guardrails including Industry size, highlighted potential markets (given India is a large country with diverse demographics and stages of economic development) and collaborated with the commercial teams to build suitable strategy for each geography. The discussions driven by finance focused on the target consumers, competitive landscape, pricing strategy and investments, thus building a strong trust with the business.  

The output KPIs were clearly defined to closely track project performance and gauge optimization of allocated resources.  

With close interaction with the commercial teams, we helped the business in deciding our trade investments strategy by highlighting competitive strategy and margins. Consistent performance review process following the Project Return framework enabled us to play the role of a challenger, re-calibrating some of our investments and closely track the progress.  

One year into the launch in Jan’21, things were going as planned however we always kept our eye on the ball to look for an opportunity. The government did not increase any taxes on cigarettes in Feb’21 and hence, competition didn’t increase the price. As time was of the essence, we quickly aligned our pricing with the market leader and brought competitive edge back to the game. At the same time, we built off-invoice discounts in the pricing and grabbed the opportunity to bring tax efficiency on the table which resulted in the savings of $1.2 Mio. 

Within a span of 2 years, Marlboro Compact has become the second largest SKU in IPM portfolio contributing to 22% of Volumes (AMV 52 Mio sticks) and 11% ($12 Mio) and 8% ($6 Mio) to NR & MC pool respectively. With the SKU now having achieved scale, we have also aligned the business on the journey of improving margins in a phased manner and generate additional resources to continue investing behind expansion and portfolio initiatives. 

Marlboro Compact has been a story of team work, clearly defined output objectives and Finance playing the role of a Strategist, Challenger and Story Teller.