Cigarette imports at 20% by 1995; home tobacco area being shrunk. (Japan)

Cigarette imports at 20% by 1995; home tobacco area being shrunk

Japan

Japan Tobacco Inc. (JTI), once the sole monopolistic supplier of cigarettes in Japan, has proven to be a skillful competitor in this newly liberalized market. Their quick responses to changes in customer taste, timely new brand introductions, and diversifications into other businesses, keeps JTI, as a corporate entity, a formidable enterprise.

Japan's 32 million smokers may choose from almost 275 different brands and extensions (four-fifths of them imported) with JTI holding almost an 88% market share. In Fiscal Year 1988, one JTI brand family--Mild Seven--held 40% of the entire market. In June, 1989, JTI introduced another extension--Mild Seven Super Lights--which took a 4% share in June and 3 1/2% in July. The May, 1988 introduction of extension Mild Filter Kings Size immediately took 4% of the market--a larger share than any imported brand.

But JTI's new competition--Philip Morris, R.J. Reynolds, Rothmans, and others--have years of experience marketing the world's highest quality tobacco products. At the end of FY 1988 (March 1989) total imported cigarette market share was 12.3% rising to 14.3% as of July (see Table 1). Industry …