Market Research on Cigarettes in Azerbaijan Republic, Baku City

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Many of these chemicals also are found in consumer products, but these products have warning labels. While the public is warned about the danger of the poisons in these products, there is no such warning for the toxins in tobacco smoke.

Here are a few of the chemicals in tobacco smoke and other places they are found:

Acetone – found in nail polish remover

Acetic Acid – an ingredient in hair dye

Ammonia – a common household cleaner

Arsenic – used in rat poison

Benzene – found in rubber cement

Butane – used in lighter fluid

Cadmium – active component in battery acid

Carbon Monoxide – released in car exhaust fumes

Formaldehyde – embalming fluid

Hexamine – found in barbecue lighter fluid

Lead – used in batteries

Naphthalene – an ingredient in mothballs

Methanol – a main component in rocket fuel

Nicotine – used as insecticide

Tar – material for paving roads

Toluene - used to manufacture paint

3 .The concept of price and pricing

Price is a one of the major economic categories. Price refers to an amount of money which the customer agrees to pay the seller for the goods, and for which the seller agrees to sell. The price can be described as monetary values per unit of goods, as the price of a certain quantity of goods define its cost.

Pricing is the process of formation of prices for goods and services.

There are 2 main systems of pricing: market pricing, functioning on the basis of supply and demand interaction, and centralized state pricing.

3.1 Price positioning of cigarettes

Azerbaijani market today can be divided into the following segments:

PremiumFor consumers of this segment the most important criteria are quality of product, image and brand awareness.

Middle

The mainstream segment is represented by both Azerbaijani and foreign manufacturers.

For these customers the main thing about cigarettes is price/quality relationship.

Economy

This segment is represented only by Azerbaijani manufactures and the target market is consumers with low income.

3.2 The lifecycle of product on the market

The product life cycle has 4 very clearly defined stages, each with its own characteristics that mean different things for business that are trying to manage the life cycle of their particular products.

Introduction Stage – This stage of the cycle could be the most expensive for a company launching a new product. The size of the market for the product is small, which means sales are low, although they will be increasing. On the other hand, the cost of things like research and development, consumer testing, and the marketing needed to launch the product can be very high, especially if it’s a competitive sector.

Growth Stage – The growth stage is typically characterized by a strong growth in sales and profits, and because the company can start to benefit from economies of scale in production, the profit margins, as well as the overall amount of profit, will increase. This makes it possible for businesses to invest more money in the promotional activity to maximize the potential of this growth stage.

Maturity Stage – During the maturity stage, the product is established and the aim for the manufacturer is now to maintain the market share they have built up. This is probably the most competitive time for most products and businesses need to invest wisely in any marketing they undertake. They also need to consider any product modifications or improvements to the production process which might give them a competitive advantage.

Decline Stage – Eventually, the market for a product will start to shrink, and this is what’s known as the decline stage. This shrinkage could be due to the market becoming saturated (i.e. all the customers who will buy the product have already purchased it), or because the consumers are switching to a different type of product. While this decline may be inevitable, it may still be possible for companies to make some profit by switching to less-expensive production methods and cheaper markets.

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Currently cigarette market in Azerbaijan has reached maturity and is close to saturation, so virtually it is not rising now. It is all because of a weak culture of healthy lifestyles and ineffective anti-tobacco policy, Azerbaijan has high performance of smoking. The percentage of smokers among the population in 2015 was 34%. On average, each smoker bought 285 packs of cigarettes a year, and smoked 15 cigarettes a day.

The percentage of men smokers in Azerbaijan now is 65%, while for the women this number is much lower 16%. The most active smokers in Azerbaijan are young people aged from 10 to 19 years. The number of regular smokers among them is approximately 40% from both sexes.

5. Survey

5.1 The structure of the questionnaire for market research on cigarette market

Dear respondent, this study is conducted to determine your preferences on the cigarette market We kindly ask you to answer a few questions below by putting a checkmark next to your chosen answer choice (in some areas, you can choose multiple answers) or write your opinion in the "other answer".

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1. How long have you been smoking?

- A year

- 2-3 years

- More than 3 years

2.