Nam Hyun-woo has worked as a staff writer at The Korea Times since 2013, mostly covering business and politics. He currently belongs to the Business Desk where he covers topics such as emerging tech, AI, ICT and Korea's chaebol community. Prior to joining the team, he was the paper's correspondent for the presidential office of Korea during the Yoon Suk Yeol and Moon Jae-in administrations.
BAT to invest 1 billion pound for 'less risky' products
British American Tobacco's (BAT) new logo / Courtesy of BAT Korea
By Nam Hyun-woo
Tobacco giant introduces new logo, non-combustible product strategy
By Nam Hyun-woo
British American Tobacco (BAT) will bet 1 billion pounds ($1.24 billion) in next generation products over the next three years, as part of its vision to have 50 million non-combustible product consumers by 2030, according to its Korean unit.
Along with this strategy, the tobacco giant also unveiled its new logo, which the company official says describes the company's vision to reducing the health impact of its business through offering a greater choice of enjoyable and “less risky” products for its customers.
During a webcast, BAT Chief Executive Jack Bowles suggested a three-pronged strategy to lead the company “to drive value from combustibles, ensure a step change in new categories (e-cigarettes and tobacco heating devices) performance and to simplify the business.”
Through the strategy, Bowles said BAT also seeks to achieve carbon neutrality by 2030 and accomplish its new corporate purpose of “Building a Better Tomorrow.”
“We are now challenging ourselves with a clear purpose to build A Better Tomorrow by reducing the health impact of our business through offering a greater choice of enjoyable and less risky products for our customers,” Bowles said.
“To achieve our goals, we need to be bold, fast, empowered, responsible and diverse. As we drive value from our combustibles business, and generate 1 billion pounds in efficiencies over the next three years through an extended simplification program, we can accelerate revenue growth of our new categories business.”
BAT Korea said it will fully deliver its headquarters' strategy as it stands as one of the most important overseas bases of the tobacco maker.
“BAT Korea is serving an important role in BAT's new strategies for manufacturing and marketing new category products,” an official at BAT Korea said, citing its plant in Sacheon, South Gyeongsang Province.
The Sacheon plant is BAT's production hub for Asia, exporting tobacco products to 15 countries, including Japan, Taiwan and Australia. Its accumulated production surpassed 300 billion cigarettes as of June last year.
Also, the company is using the Korean market as its test ground, introducing two e-cigarette devices last year. The company also plans to debut new e-cigarette products this year.
“Along with new products, we will continue making efforts to expand our market share,” the official said. “Along with our business side efforts, BAT Korea will fully deliver the headquarters' strategy for environment and corporate social responsibility.”
Over the COVID-19 outbreak, the headquarters said its business is “resilient and is supported by a geographically diversified supply chain from both a manufacturing and distribution standpoint,” thus it has seen “no material impact.”
BAT said it expects its new category revenue will reach 5 billion pounds in 2023, with a 3 percent to 5 percent annual growth rate in total sales.