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BAT Converts Korea

By Heneage Mitchell

In Seoul, shoppers at a 7-ll convenience store stare at packs of Kent Convertible cigarettes which have just been launched exclusively in the city. The packs are apparently equipped with different colored flashing lights that are signalling for attention.
In Busan, on the other side of the country, a Korean businessman places several packets of Kent Convertible that he purchased in Seoul that morning on the table in front of colleagues and associates, dispensing individual sticks or entire packets to his enthralled guests.

In an upstairs bar frequented by American expatriates, a visitor is handing out Kent Convertible sticks around the bar, demonstrating the technique required to release the menthol flavor and then increase its strength to a riveted crowd of smokers.
Within three weeks of its launch, BAT’s new Kent Convertibles cigarette had gained unprecedented market share, exceeding BAT’s expectations and attracting smokers to its new smoking concepts, and marking another significant – and unique - product launch in a country that has been described as a “must win” market for cigarette manufacturers.
The Korean market has become a sort of testing ground for new products and innovative smoke concepts, with brand variants researched, designed and manufactured specifically for the country’s smokers.
The patented flavor capsule technology incorporated in the unique charcoal filter system which lends the filter the ability to “convert” from a regular charcoal filtered light cigarette to a menthol stick, and then to increase the amount of menthol released into the smoke by rolling it between the fingers (“click and roll”) is claimed to represent the most significant innovation in filter technology since filters were invented.
The product has caught on rapidly, with Korean (and ex-pat) consumers buying in to the concept with gusto, proving once again that Korea is a market that embraces change and innovation.
“Korea was chosen as the market in which to launch Kent Convertibles because Koreans love innovation, they are open to new things that add value and functionality in a product,” confirmed Jeremy Flint, BAT Korea’s CORA executive director talking to Tobacco Asia recently. “Koreans love to see high-tech functionality in high-end products. BAT was looking for something to capture the imagination of Korean consumers. While flavor capsules are not new, - they’ve been around for two or three years in other markets – the charcoal filter and convertible technology incorporated in the filter – which should not be confused with boost products, which have also been around for a while,. offers something unique.”
Clearly, the Korean consumer thinks so as well. Initial sales reports indicate Kent Convertibles gained a market share of over 2.3% in Greater Seoul in key accounts within a month of its launch..
The brand was launched nationwide in mid-August, and is expected to continue to show the sort of performance experienced in Greater Seoul as its appeal is clearly in tune with the Korean consumer mindset.

Elements of success
Packaging is a key element in the success of Kent Convertibles. Being able to communicate to the consumer in the 15 seconds or so they spend in a typical sales environment presented a challenge that BAT overcame by supplying point of sales materials that explain how the product works. For many consumers, the first time they see the product is in a display shelf. In some outlets, BAT has supplied LCD screens that cause the reflective logo on the top left of the package to change color, appearing as if the packet contains its own light source. The effect is immediate and very appealing. One can’t fail to notice the package as it stands out from all the other products on the shelf.
In order to get the product on the market, placing the capsule inside a charcoal filter was the paramount challenge. Getting the filter assembly process working properly took a lot of time, effort and ingenuity.
“The second area of concern was the packaging,” said Flint. “The pack itself is easily damaged and has a number of glittery, shiny enhancements. The pack cannot be treated the same way as regular packs on a production line as there is a risk of damage and consequent waste or imperfect packs reaching consumers. So the packing lines had to be carefully designed to incorporate gentle handling of the packs before they are overwrapped.”
Production of Kent and another newly introduced product, Dunhill Nanocut (about which more later) takes place in Singapore which is currently the only BAT facility with the appropriate equipment available. All other BAT products sold in Korea are manufactured domestically in the Sacheon factory, rated as one of the best in the BAT group boasting an unsurpassed quality record.
“The Sacheon facility is, always in the top one or two factories it the world for production based on a cigarettes-per-man-hour evaluation, Flint revealed.

Growing family
Other newly launched BAT products, developed exclusively for the Korean market, that are seeing success domestically include Kent HD and Dunhill Nanocut.
Kent HD incorporates a recessed charcoal filter with a blue tobacco-flavored filter thread running through it. A 6mg cigarette, the HD’s packaging also requires delicate handling. In fact, when the product was first being produced, the pack cartons were being handled individually to avoid damaging or scratching the high-end reflective silver and deep glossy black elements in the design.
The production lines now incorporate effective safeguards to ensure the packs reach the consumer in pristine condition, but the development process is a tribute to the care and concern BAT has showered on its new product lines.
Dunhill Nanocut is a king-size super slim cigarette aimed at ASU30 smokers, trying to create a new franchise in the dynamic slim market in Korea.
“Nanocut is very much a niche player, and BAT is happy with the progress it has made, consistently growing and holding market share,” Flint told us.”
Korea differs from other markets in that super slims are preferred by older, often male, smokers. Accordingly, super slim packaging tends to reflect more masculine values. Nanocut, which is aimed at a younger segment, incorporates embossing and other sophisticated printing techniques to meet the market preferences.

Back to the future
Not content to rest on its laurels, BAT is continuing to plan ahead to ensure it retains ot market share in the highly competitive and ever-changing Korean market.
“Future challenges are to continually innovate to meet the demands of the Korean consumer,” agreed Flint. “He who innovates will win here. Korean consumers are swayed by new fashions, innovative approaches in packaging and product specifications and are always willing to try something new. But it has to be right first time as there are no second bites at the cherry. Korean consumers have extraordinarily high expectations and we have to ensure that what we deliver exceeds their expectations.” This will remain a primary challenge for BAT, and one which it is clearly up to achieving.

 

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