• Innovation: Innovation is an important factor in the development of a product; in this
case Philip Morris must continually innovate its product portfolio for this it must make
investments in marketing especially in advertising and promotion. In order to create value
in an industry with a high intensity of competition, a company has to develop a
competitive advantage. PMI is trying to create a competitive advantage by constructing
unique brand personalities that represent values apart from tobacco through sophisticated
branding. The competitive advantage rising from this is a high brand loyalty and
willingness to pay since the brands have an exceeding reconcilability and are less
associated with their health hazards and more with the from the company infused values.
In order to produce its offerings cheaper than the competition, the company focusses on
creating a profound vertically integrated value chain. This includes not only their supplier
