Marlboro Keeps its Spark as World’s Most Valuable Tobacco Brand

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Marlboro has retained its title of the world’s most valuable tobacco brand, despite recording a 3% decrease in brand value to US$32.7 billion, according to the latest report by Brand Finance, the world’s leading independent brand valuation consultancy. The tobacco giant remains in a league of its own in the sector with the second most valuable tobacco brand, L&M, significantly behind with a brand value of US$6.3 billion.

Philip Morris International-produced and Altria-owned Marlboro is the world’s top-selling cigarette brand and has maintained solid sales and shipment volumes over the years in the face of changing tastes and greater scrutiny of the industry as a whole. Marlboro’s high shipment volumes have largely been driven by growth in Indonesia, Saudi Arabia, Turkey and the Philippines, where the brand has benefited from narrowing price gaps with the below premium price segment.

Philip Morris International is championing a smoke-free future through its new campaign ‘unsmoke the world’, contradicting its 173-year history. Its decision to spearhead the revolution in the tobacco sector towards cigarette alternatives has had mixed fortunes for the group. Its significant investment in e-cigarette brand Juul and development of its own brand IQOS have been damaged by tightened regulation of the e-cigarette market, with the US and China banning fruit flavoured e-cigarette products and with leading retailer Walmart banning the products altogether.

David Haigh, CEO of Brand Finance, commented:

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“Tobacco brands are certainly familiar with being criticised and scrutinised closely, having had to continually react to ever-changing consumer tastes and heightened regulation. We have witnessed the damage that plain packaging has caused the industry and the subsequent shift towards smoke-free, supposedly healthier, alternatives. However, with the e-cigarette market now very much under the limelight, these tobacco giants will have to plan their next steps wisely if they want to maintain their dominance and relevance globally.”   

Winston accelerates

Three brands in the ranking have recorded solid brand value growth – Pall Mall, Winston and Copenhagen – with Winston leading the way, seeing an impressive 9% increase in brand value to US$4.1 billion. Winston is currently sold in a staggering 120 countries worldwide, and is the second best-selling cigarette brand globally, falling only behind long-standing leader Marlboro. JTI began manufacturing Winston cigarettes in Greece last year, simultaneously boosting it production and export capabilities and widening its global footprint to a further nine countries in the EU.

Camel gets the hump

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In contrast, fellow JTI-owned brand Camel has suffered the largest drop in brand value in the ranking, down 14% to US$3.4 billion. Historically, Camel has been a leading brand in the menthol market, however with more countries banning these products, including Canada, the US and the EU as of May 2020, the brand’s sales, and consequently its brand value, has suffered.

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Newport has been dealt a similar fate in the face of increasing regulation around menthol cigarettes and has dropped out of the Brand Finance Tobacco 10 ranking this year, following a 6% drop in brand value.

Sampoerna’s uncertain future

Sampoerna (brand value up 1% to US$3.3 billion) has been the top-selling brand in Indonesia for over 10 years, where consumption of flavoured tobacco continues to be popular and unregulated. Recent announcements from the Indonesian Government, however, declaring plans to raise minimum prices of cigarettes by a third in 2020 in attempt to cut its smoking rates that currently stand at some of the highest in the world, poses an uncertain future for the brand.

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Two new entrants

There are two new entrants into this year’s ranking, Rothmans (brand value US$3.1 billion) and Gold Flake (brand value US$3.0 billion). British brand Rothmans’ brand value has been boosted by its strengthened position in the Russian market. The brand originally entered the market in the early 1990s and has been recording double-digit growth ever since, rising to the second most popular brand in the country.

Entering the ranking in 9th position, after dropping out last year, is ITC-owned Gold Flake. Its brand value was damaged by the highly active illicit trade market in India, as well as by the prolonged period of higher taxes across the nation. The brand has reaped the rewards, however, from Modi’s cut in corporate taxes last year and has thus seen a spike in its brand value and re-entry into the ranking.

L&M is the sector’s strongest

In addition to measuring overall brand value, Brand Finance also evaluates the relative strength of brands, based on factors such as marketing investment, familiarity, loyalty, staff satisfaction, and corporate reputation. Alongside revenue forecasts, brand strength is a crucial driver of brand value. According to these criteria, L&M is the world’s strongest tobacco brand with a Brand Strength Index (BSI) score of 76.9 out of 100 and a corresponding AA+ brand strength rating. L&M is the 4th best-selling international cigarette brand outside of the US and China and thus one of the best performing brands in the Philip Morris International portfolio.

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Marlboro Keeps its Spark as World’s Most Valuable Tobacco Brand - Brand SpurMarlboro Keeps its Spark as World’s Most Valuable Tobacco Brand - Brand Spur

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Marlboro Keeps its Spark as World’s Most Valuable Tobacco Brand - Brand SpurMarlboro Keeps its Spark as World’s Most Valuable Tobacco Brand - Brand Spur

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