Case Study - Research Design

RJR Nabisco

Ever since the health aspects  of smoking  became  a public  issue  shortly after world war II the tobacco industry knew there  was a threat  of a long term  decline in  demand for tobacco products particularly cigarettes. As a result  virtually every company in the  field had been  seeking  new  products. In 1987 FJR Nabisco  came up with  an innovative cigarette that virtually eliminated two  of  the most objectionable  aspects  of cigarette smoking  smoke  emitted  into the air  and tar inhaled by  the smoker.  The former  caused  non smokers  to object to smoking  in public  places  and the  latter  encouraged smokers  to quit.

The new  product  looked like a cigarette  but inside  it was  a miniature distillation systems. The tip  could  be  lit like  an ordinary cigarette but it  was really  a slow  burning  column  of carbon. When a smoker drew  on the cigarette heated air  was drawn  through  a short  segment of  the cigarette which was filled  with  tobacco there the  air picked  up a  taste  of tobacco and a dose  of nicotine as the tobacco  didn't  burn it left  no ash and indeed  and the  cigarette looked  the same  after  being. Smoked  as before.

At the  press  conference to announce the new product the chairman of the board of R. J Reynolds  Co. Stated. This  represents  a major  evolution in  cigarette design  others referred to it as a rube  Goldberg drug delivery systems  for nicotine.

Industry  observers took  various  views of the new  product  a step in  the right  direction was one  comment by  those  who saw  the elimination of  tar as a move  toward a safer diabetes smoking  is no  more socially acceptable as a results  of the new product was a negative comment  as was  this just  makes the  health  issues  of smoking  front page  news  again.

Tests  run by  the company  showed  that  smoke  from the  new  product  contained  fewer  of the  compounds found in  conventional  cigarette smoke  but  skeptics speculated  that it might  produce  a whole  range  of new by products  not found  the standard  cigarette. The new  product still  delivered carbon  monoxide and nicotine  both of which  had been associated  with  disease. Nicotine  was  also  related  to ulcers  and  birth  defects.

Some  believed  the development of the  new  cigarette might  be the  equivalent of  firm shooting itself  in the foot. If it made  a safer cigarette  the company would  be admitting  it knew the  other  cigarettes were  not safe and might open it to product liability suits.

Best estimates were that the new  product  would cost the consumer 15 percent  to 20 percent  more  than regular cigarettes but the  current trend was that lower priced discount brands were  gaining  in  the market. To introduce the product  effectively  would cost about $ 100 million but this  estimate was made without  any clear idea of what  government regularly problems would have to be overcome.

Before  committing itself  to a capital investment  of that magnitude the firm needed to know  what  consumer resection should  be. Exploratory  research seemed  the obvious  place to start.

Questions

a.Would you recommend  focus  groups  or some  other  research design in this  situation?

b.If focus  groups  should  be used ?

1.How  many  groups  should be  used ?

2.How many  individuals should  be in each group ?

3.What  types  of individuals  should be in each group ?

c.Plan  a discussion  outline  for use  by a focus  group  moderator.

d.If you  recommend other  focus  groups  describe  your  proposal  and explain its advantages.