PURSUING NEW GROWTH
The modernisation of the online platforms
is being implemented in 17 workstreams,
such as Personalized Marketing, Website
Redesigns and Consumer Profiling. The
five business units will address the unique
preferences of the eight distinct consumer
segments and their purchasing patterns,
reinforcing existing strengths while also
allowing the pursuit of new growth.
Smaller business units are helping to
unlock capital to fund those objectives
the Thompson Cigar Auction website
has been shut down, customers migrated
to CigarBid Auctions and marketing
efforts optimised in the Pipes and Cigars
business, which is experiencing a declining
market. Responsive websites have been
launched for Thompson Cigar, Cigars
International and CIGAR.com.com, which
has also been redesigned with a premium
look and feel and personalized product
recommendations driven by artificial
intelligence.
company profile 2021
company profile 2021
Its about increasing customer reach
and increasing share of wallet, Zdan
says. The overall aim is to deliver an
exceptional consumer experience by
digitalizing, improving user experience,
introducing more personalization and
adding more value in terms of loyalty.
We test new digital experiences with a
small segment of our consumers to ensure
changes are well received, Smelko says.
Overall, were seeing positive results and
we have learned some lessons along the
way, but thats what allows us to serve our
consumers even better in the future.
The results are already showing. All of the
key performance indicators are positive
month-over-month and there has been a
drastic change, with significant consumer
migration to the online channel. From
March until the end of 2020, NAO&R saw
significant growth coming from these
initiatives, and more is yet to come.
CHRISTIAN GRØNBECH
VICE PRESIDENT COMMERCIAL
EXCELLENCE
MICHAEL SEIER PETERSEN
INTERNATIONAL CHANNEL
DEVELOPMENT MANAGER
HOW TO SELL CIGARS
IN A PANDEMIC
Create clear propositions and brand
delineation between NAO&R business
units and competitors
scandinavian tobacco group
Win market share and reach new
consumers, especially younger,
premium smokers
18
Protect profitability and focus on
higher margin segments
COVID-19 restrictions meant customer visits were out. So Scandinavian
Tobacco Groups sales reps switched to the telephone it took some time
getting used to, but the result has been increasing market share.
S
ales reps are used to life on
the road in the car, visiting
customers, day in and day out.
But not in a pandemic.
Many stores closed and those which were
open implemented social distancing.
Either way, there was no time or space for
retailers to speak to Scandinavian Tobacco
Group reps when queues of customers
stretched out the door.
In a quick and effective adaption to the
new COVID-19 reality, tele sales proved
an effective addition in Scandinavian
Tobacco Groups key European markets
and the results are clear.
The switch came with challenges, but
by implementing tele sales rapidly and
ironing out issues as they came up, the
European team successfully contributed
to increasing market share, a key method
of driving sustainable profit in machine-
rolled cigars across categories. The
combined market share in the largest
European markets (France, Belgium, the
Netherlands, UK, Germany, Spain and
Italy) was 33.3% in the second quarter of
2020, versus 32.7% in the first quarter.
Firstly, its about people and our sales
force keeping everyone safe and also
engaged and motivated in this unknown
situation. And then its about agility and
scandinavian tobacco group
THE MODERNISATION HAS
HAS THREE OVERARCHING
BUSINESS OBJECTIVES
The overall aim is to deliver
an exceptional consumer
experience by digitalizing,
improving user experience,
introducing more
personalization and adding
more value in terms
of loyalty.
Continues
19
OUR MUST- WIN BATTLE STORIES A TRANSFORMATION TO LEAD BUSINESS GROWTH P. 16 HOW TO SELL CIGARS IN A PANDEMIC P. 19 INTEGRATION THE KEY INGREDIENT FOR A SUCCESSFUL ACQUISITION P. 21 KEEP IT SIMPLE P. 24 PLANNING THE UNPLANNABLE P. 26
company profile 2021 company profile 2021 CONTENTS WELCOME 2020 has been an extraordinary year with COVID-19 changing our lives fundamentally and creating unprecedented challenges for businesses. PAGE 04 A TRANSFORMATION TO LEAD BUSINESS GROWTH Scandinavian Tobacco Groups North America Online & R
company profile 2021 WELCOME A GLOBAL LEADER IN CIGARS 2020 was yet another transformative year. We accelerated the modernisation of our company, announced the biggest acquisition in the history of our Group and launched a new strategy, Rolling Towards 2025. NIELS FREDERIKSEN President and CEO 2
These articles will give you a sense of the hard work, dedication and innovation of our employees, whose efforts are enabling us to overcome the unprecedented circumstances we are working in around the world, to create value for the company, our employees and shareholders. I hope you enjoy the read
company profile 2021 company profile 2021 OUR VALUE CHAIN 1 2 IT STARTS WITH A SEED All tobacco starts with a seed. The development of a tobacco plant depends on factors such as soil, sun, rain, position of the leaf on the tobacco plant and the time of harvesting. Our cultivation activities take p
NET SALES 8,006 DKK million EBITDA BEFORE SPECIAL ITEMS 6.6% Organic growth DKK million Organic Growth DKK million Organic growth DKK million 16% 6,000 4% 1,500 8% 4,000 0% 1,000 0% 2,000 -4% 500 -8% 0 2018 2019 -16% 2018 2019 FREE CASH FLOW BEFORE ACQUISITIONS NET PROFI
company profile 2021 OUR BRANDS AND PRODUCTS FINE-CUT TOBACCO Our handmade cigars are rolled at our sites in three of the worlds most significant tobacco-growing countries: the Dominican Republic, Honduras and Nicaragua. Our fine-cut tobacco is predominantly manufactured at our site in Holstebro
In the course of 2020, we conducted a review of Scandinavian Tobacco Groups corporate strategy. The result was a new company profile 2021 company profile 2021 OUR STRATEGY PURPOSE VISION CRAFT THE RITUALS THAT MAKE US MORE BE THE UNDISPUTED, GLOBAL LEADER IN CIGARS updated strategy Rolling
company profile 2021 company profile 2021 Were bringing together responsiveness, design, loyalty and personalization to create an overall unique proposition, which is more sophisticated and provides a better consumer experience CASSANDRA SMELKO, DIRECTOR STRATEGY AND TRANSFORMATION, NORTH AMERICA
PURSUING NEW GROWTH The modernisation of the online platforms is being implemented in 17 workstreams, such as Personalized Marketing, Website Redesigns and Consumer Profiling. The five business units will address the unique preferences of the eight distinct consumer segments and their purchasing pa
Sometimes being bold can bring you more value than discussing the nitty gritty details for months and then you find the answer but by then the question has changed. This is where we are trying to make a difference and show we can move fast and increase share in market and volume. company profile 2
Scandinavian Tobacco Group aims to grow, strengthen its brand portfolio and leverage its costs through successful mergers and acquisitions, and the integration of its largest acquisition to date Agio Cigars, a leading European company with 3,200 employees bodes well for the future. In fact, as Sen
EMPOWERMENT AND AGILITY Data has become less transparent and processes have become more complicated as Scandinavian Tobacco Group has expanded through acquisition of familyowned companies, each using its own legacy system and data structures. The overall aim of these processes and structures is the
Across three continents, 14 production facilities and above 6,500 employees, the efforts of the Operations team have made Scandinavian Tobacco Group an industry leader in how to tackle the pandemic and ensure safe working conditions all while increasing production at the same time. The companys fac
company profile 2021 company profile 2021 2 BLEND OUR STRENGTHS OUR VALUES OUR PEOPLE TARAN SALABSKY DIRECTOR OF CREATIVE OPERATIONS Each individual throughout the Group has a unique skillset and perspective. Sharing these skillsets has been key to our past successes and will be instrumental in
RETAIL EXPANSION During 2020, we opened three new cigar Super-stores in the US; in Fort Worth, Texas and Tampa and Lutz, Florida. In 2020, we adopted our first CSR strategy focusing on four areas, each with its own defined ambitions, activities and goals. Those focus areas are: PEOPLE & COMMUNITI
SCANDINAVIAN TOBACCO GROUP A/S Sandtoften 9 2820 Gentofte Denmark CVR 31 08 01 85 Make www.st-group.com