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F I R ~j R ,." CX 33-A 2532 !

THE VIRILE SEGRENT ~ U CX 33-B 86M02533 !

ANALYSIS ~F THE VIRILE SEGHEN[ ORJECTIVES -- " IDENTIFY LONG TERH FORCES AFFECTING PERFORIqANCE OF SEGPIENT ANrJ BRANDS W]THIN IT* " ]~ETERH|NE KEY STRATEGIC ISSIIES FOR BRANDS. CX 33- C :-~ --, ......~; 86M02534

ANALYSIS OF THE VIRILE SEGflENT • BACKGROUND ! SkLES PERFORHANCE :~: - SHARE OF' MARKET ~ - MARKET ~YNAH! CS ." ~-*, "" AGING " -" SWITCH| NG .... • B~ND [SS.ES - ~ARLBORO - glNSTON - CAHEL ! SUmmARY • CX 33-D .~ 86M02535

II ~tALYSIS OF THE VIRILE SEGMENT THE PERFORHANCE OF THE VIRILE SEGNENT IS CRITICAL TO UNDERSTAND-" LARGEST SEGMENT IN SHARE OF HARKET TI~0 LARGEST I~RANO FAMILIES LARGEST CONCENTRATION OF YOUN~ER AOULT S~OKER~ SEVERAL OF THE ~LDEST ~RANDS STILL ON THE ~ARKET LARGEST SOURCE OF S~ITCHERS • HOST STABLE SEGHENT IN SHARE OF MARKET O R ,j R CX 33-E 86M02536

A~ALYS]S OF TffE yIRILE SEBRENT ~EGRENT'~ ~ALES PERFORRANCE SHARE OF MARKET V|R|LE SEGMENT SHARE OF MARKET eSTABIL|ZED" IN 1958 -- -"'1958 SON - ~1.79I -19R5 SO~ - ~O.E2I ~ THIS STABILITY ENDURED IN THE FACE OF THE DECLINE OF THE -0oOq SHARE POINTS/YEAR OVER 28 YEARS TRADITIONAL SEGMENT AND THE GROWTH/MATURAT|ON OF THE OTHER FIVE SEGMENTS- CX 33-F R J R u ,4 2 .2 86M02537

CIGARETTE MARKET SEGMENTS PERCENT SHARE OF MARKET Coolness Stylish )Concezned gT~ CX 33-G

~IALYSIS OF ~H[ VIRILE SEGMENT SEGMENT'~ SALES PERFORMANCE MARKET DYNAMIC~ THE STABLE PERFORMANCE OF THE SEGMENT IS A BEL|CATE BALANCE BETWEEN THE AGING COMPONENT "- YOUNGER ADULTS AND OLDER SMOKERS -- OF THE MARKET DYNAMIC AND THE SWITCHING COMPONENT, THE LARGE -- AND INCREASING -" SHARE OF YOUNGER ADIILT SMOKERS HAS ALWAYS HOME THAN BALANCED THOSE OLDER SMOKER WHO LEAVE THE MARKET --T-* - THE ~-~'E~ENT HAS CONTINUALLY GAINED SHARE THROUGH AGING" THE SWITCHERS FROM THE SEGMENT ARE LOST DUE TO NEW BRAN9 |NTRODUCTION AND MAJOR EXTERNAL EVENTS -- - THE SEGMENT HAS CONTINUALLY LOST SHARE THROUGH SW|TCH|NG. S0M CHANGE nile TO • • • TOTAL AGING SWITCHING 1977 -.78 +,58 -1.36 1978 -.lq +.58 -.72 1979 -.66 +.6~ -1.26 1980 +.]8 +.59 -.q] 19~] +.56 +.66 -.10 19~2 +.59 +.82 -.23 1983 -1.27 +.83 -2.10 198~ +.75 +.Sq -.09 19R5 +.06 +.R3 -.77 SOURCE .' PISA/TRACKER/NF0/CENSUS NOTE: SWITCHING = Jura S0PI CHANGE - ,A, GING CALCULATION R /'1 U CX 33-H 86M02539

YEARLY SHARE POINT CHANGE 2- 0.5 --0.5 | VIRILE MARKET DYNAMICS Aging and Switching Components ......... • .................... ~ "'" Swltch~ng / ,,,v/ • • V I I I I , I I I I I i977 ~i978 1979 1980 19~! 196~ 1963 1984 1985 CX 33-I

¢) '11 ~NALYS|S OF THE VIRILE SEGHEN~ SEGMENT~,,~ SALES PERFORMANCE MARKET DYNAHIC$ FIRST IJSUAL RRAND YOUNGER ADULT SHOKERS THE YOIINGER ADULT COMPONENT I$ OF CRITICAL IMPORTANCE TO THE SEGMENT " THESE SMOKERS START WITH THE SEGMENT AND REHA|N LOYAL TO IT- X WHO STARTED IN SEGMENT TRADITIONAL Jq-OX 12,2¢ 20.OZ 0.0~ VIRILE J 35:1 ~8.8 COOLNESS 33.5 37.1 86-7 66.6 STYLISH 23-9 qg.q qq.7 HODERATION ]7.J 21.7 30.8 3q.7 CONCERNED 16.1 17.q 17.1 16.6 SAVINGS NA HA NA HA SOURCE: 1985 SEGMENT DESCRIPTION STLIDY CX 33-J