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The marriage between U.S. tobacco giant Philip Morris and
Indonesia's top cigarette producer PT HM Sampoerna has produced a world
first -- a Marlboro kretek (clove-blended) cigarette.
Unlike other Marlboro cigarettes, which dominate the mostly
machine-rolled, non-clove segment of the market, the new brand, named
Marlboro Kretek Filter, will be jockeying for space in the
machine-rolled kretek cigarette market, complementing Sampoerna's
existing Dji Sam Soe Filter brand.
Sampoerna managing director Angky Camaro said during the launch of the
new brand Tuesday that with its introducing to the Java and Bali
markets, Marlboro Kretek would be the first international brand
offering the taste of kretek in Indonesia.
"With the kretek taste and the strong image of Marlboro, we believe
that our new brand will attract more mature smokers," he said.
Sampoerna obtained a license from Philip Morris to produce and market
products using the Marlboro trade name in June 2006. Afterwards,
Sampoerna conducted a survey to ascertain what smokers really wanted
from its products, and then set to work developing new products based
on the survey findings.
According to Angky, 92 percent of adult smokers in Indonesia prefer
kretek cigarettes to non-clove ones.
Machine-rolled kretek cigarettes control around 35 percent of the total
cigarette market, second to hand-rolled kretek cigarettes, which
control a 39 percent share.
Henny Susanto, Sampoerna brand marketing director, said that after
being launched on the Java and Bali markets, Marlboro Kretek would be
rolled out nationally, and then internationally.
However, she refused to estimate potential sales figures.
"Because this is a new product, we will first focus on building
consumer awareness of it and strengthening distribution in Java and
Bali," she explained.
Sampoerna will advertise the new brand using the well-known "Marlboro
Country" concept. It will use billboards, print media and theater
commercials as promotion tools.
Philip Morris owns a 98 percent stake in Sampoerna.
Sampoerna currently controls a 28.2 percent share of the country's
cigarette market, followed by Gudang Garam on 23.6 percent and Djarum
on 20.4 percent.
In 2006, Indonesian cigarette makers produced a total of around 220
billion cigarettes.
By the end of the first quarter, Sampoerna had booked a 15.7 percent
increase in net profit to Rp 1.095 trillion (US$125.7 million) from Rp
947 billion during the same period last year.
Sales of its machine-rolled cigarettes rose to 6.4 billion from 6.2
billion previously.
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