RRP LEAD Pre-Assessment

What is Andre’s vision for RRPs?

Commercialize products for adult smokers that offer satisfaction and reduce the risks associated with cigarette smoking

Convert 20 million adult smokers to IQOS by 2020

Convert more than one billion adult smokers to PMI’s portfolio of RRPs

Why do we think Platform 1 has the potential to be a Reduced Risk Product?

Because the toxicological and clinical tests prove it

Because tobacco is not burnt but heated

Because it’s an electronic device

What kind of RRP is needed for positively impacting population harm? (Select all that apply)

A substantiated reduced risk product

A product that gets consumer’s acceptance and usage

Against what do we benchmark the health risks associated with the use of RRPs? (Select all that apply)

What does the acronym HPHC stands for?

Harmonized Process for Product Commercialization

Harmful and Potentially Harmful Constituents

High Potential Healthier Compounds

What do we mean by “Reduced Formation”?

Less chemicals are formed in the aerosol

It is a reduced risk product

The negative effects associated with the use of the product are reduced

Which of the following best describes Corporate Affairs’ overall mission with regards to RRPs?

To establish before launch a comprehensive regulatory and fiscal framework for the combustion-free category that encourages as many adult smokers as possible to switch to RRPs

To build an environment where the benefits of RRPs are widely understood and accepted and where the fiscal and regulatory treatment of RRPs encourages adult smokers who intend to continue smoking to switch to RRPs as quickly as possible

To support the successful commercialization of PMI’s RRPs by establishing the credibility of PMI’s scientific research substantiating the reduced risk potential of its RRP portfolio

What are the core CA Strategic Pillars for RRPs?

Direct government engagement and communication campaigns to oppose bans or excessive regulation of RRPs

Government affairs, public affairs and scientific engagement to create awareness, build credibility of PMI Science and RRPs and generate societal demand for RRPs

Education and activation of third-party stakeholders to advocate for a global regulatory framework model

What are the core elements of an ideal regulatory framework for RRPs? (Select all that apply)

Product quality and safety standards for placing RRPs on the market

Consumer communication, labelling, product content and public use rules that are less restrictive than for cigarettes

Regulations allowing for scientifically substantiated health-related claims

Minimum regulations to help ensure that unintended consumer groups remain uninterested in using RRPs (e.g. Minimum age laws; bans on marketing directed at youth)

Which of the following products should not fall under a regulatory framework for combustion-free RRPs?

Heated tobacco products

E-cigarettes

Medicinal nicotine products (e.g. Nicotine patches or inhalers)

Swedish snus

Which of the following most accurately reflects PMI’s point of view on taxation of RRPs?

All RRPs must be taxed as they are not risk-free

No tax or very low tax is the most appropriate tax policy for RRPs initially

Heated tobacco products should be taxed but not e-cigarettes

RRPs should be taxed based on their nicotine content

Which model is the most effective in building a new category with LAS early adopters and innovators?

Diffusion of Innovation

Variable Cost Business Model

Brand Adoption Model

Which one of the following leads to higher level of adult smoker conversion with proper guided trial?

Which of the following statements is INCORRECT?

Make the PMI Affiliate organization structure as lean as possible

Shift resources from CC to RRP without head count increase

Full buy-in and inclusion of entire PMI Affiliate organization

Manage the entire RRP commercialization as a line extension project

What are the main commercialization challenges for IQOS? (Select all that apply)

Offer to adult smoker is complex and new

New ritual and behaviors to use the technology

Adult smoker conversion requires handholding

Time required to explain heat control technology to adult smoker

Set up new touchpoints with adult smoker

Which one of the below statements about the adult smoker conversion journey to IQOS is INCORRECT?

It defines the steps required to turn unknown LAS Prospects into IQOS Ambassadors

It helps prioritize communication & messaging to address key barriers

Adult smoker does not need to go through all the steps of the conversion journey

It is the brand’s response to the adult smoker’s mindset and questions at each phase of the conversion journey

What are the steps of the IQOS conversion journey?

Learning, experiencing, living and sharing with LAS’s friends.

Learning, living and sharing with LAS’s friends

LAS awareness, Trial, Adoption, Advocacy

There is not pre-defined steps, it depends on the mindset of the adult smoker

How do we define LAS predisposition to convert to the IQOS proposition?

By a combination of age, gender and main brand smoked only

By a combination of life-stage (social living situations), lifestyle (relational occupation with close contact with others, hobbies, interests) and a general sense of open-mindedness

By identifying which conventional cigarette consumer segments should be targeted for IQOS

All of the above

What would be the right content to use from the Marketing Toolbox in the "Learning" phase to drive LAS awareness, provide initial understanding and education about the IQOS proposition?

Provide guided trial and share testimonials of converted IQOS adult users

Encourage & facilitate sharing of experiences through rewarding programs

Provide continued hyper care to IQOS purchasers via online and offline support

Introduce the Heated Tobacco category, explaining IQOS HeatControl™ Technology and its related benefits

In a given market, there is no warranty coverage stated in the consumer protection laws. However, our affiliate in this market decides to include in the IQOS user guide the following statement: “buyers are entitled to 12 months warranty after purchase.” What is the name of the consumer's right and is it legally enforceable?

Which one is the most preferred service channel (stated preference) by the Millennials (born 1981-1999) to receive technical support for consumer electronics?

Which service touchpoint is authorized to handle the health related events (ie. Claiming to feel unwell after using IQOS) coming from consumers?

A customer is dissatisfied with the service provided by the IQOS Contact Center due to long waiting time. The Contact Center supervisor decides to contact this customer back. How should the supervisor handle the situation?

Offer the customer an IQOS cover for free

Offer the customer a free ticket for an event

Listen the customer feedback carefully and thank kindly

Listen, explain the personal assistance program and suggest the customer to enroll to this program

The supervisor should not call back the customer

Assuming we can sell IQOS Tobacco Sticks in packs and bundles through tobacconists or IQOS website in a market, which of the following would be the most expensive in terms of cost of selling (% of Retail Selling Price)?

Depends on the retail trade margins and e-commerce fulfillment costs

Always packs in retail

Always packs online

Always bundles in retail

Always bundles online

What parameters does PMI use to prioritize a market for the launch of RRPs? (Select all that apply)

Fiscal and regulatory classification of Tobacco Sticks

Profit Pool

Affordability and taste preferences

Strategic considerations

Which Regulatory and Fiscal classification of Tobacco Sticks is generally not acceptable for launching IQOS in a market?

Reduced Risk Products Classification

Smokeless Classification

Cigarette Classification

None of the above

What do we mean by "Converted" adult IQOS user?

95% or more of the user’s daily tobacco consumption is IQOS

90% or more of the user’s daily tobacco consumption is IQOS

The consumer considers himself/herself converted

The consumer only uses RRP products

Which of the following can the marketing panels of IQOS users help me with? (Select all that apply)

Understand the profile of adult smokers most likely to convert

Understand how long it takes for adult smoker to convert to the IQOS proposition

Understand the triggers and barriers to adult smoker’s conversion to IQOS

Measure KPIs

In a market with low menthol penetration, which variants of Tobacco Sticks should we encourage non-menthol adult smokers to try?

It depends on the cigarette brand they smoke

All of the variants

In RRP, how do we measure awareness?

The proportion of adult smokers who are aware of Tobacco Sticks

The proportion of adult smokers who are aware of IQOS

The proportion of adult smokers who are aware of both Tobacco Sticks and IQOS

The proportion of adult smokers who are aware of IQOS, know its product benefits and find them relevant

Thinking about the conversion journey of adult smokers to IQOS which of the following are correct? (Select all that apply)

The first week is critical to ensure that adult smokers fully switch from cigarettes to IQOS

Once the adult smoker is converted to IQOS, it is unlikely that such smoker go back to cigarettes

Once they abandon IQOS, adult smokers are unlikely to go back to IQOS

1. Is it accurate to describe RRPs as products that are scientifically demonstrated to reduce the risk of smoking-related diseases?

Yes

Partially

Consumer testimonials are a great way to provide first-hand consumer feedback on a product. Is it therefore correct to state that they just need to be illustrative of what the consumers think of the product in question?

Yes

Not exactly

How many internal resources (employees) should be allocated to RRP activities as of the 1st day of the IQOS Launch?

10 to 15%

As many as possible as the RRP is the priority and every organization needs to put every single employee to fully focus on the IQOS commercialisation

Management team need to decide and allocate appropriate number of resources to ensure 3% market share of RRP in the 1st year of operation

Not many. Majority of activities will be performed by the 3rd party partners

What are the most critical type of jobs for the 1st phase of RRP commercialization to ensure the highest number of adult smoker conversion to RRPs?

Community Activators / Brand Ambassadors / Territory Executives

Marketing Executives, Hostesses, Brand Ambassadors

Sales Representatives, Marketing Director, Territory Executives

It is difficult to answer as every market is different and the critical jobs may differ market by market

What should be the organization structure of the Field Force for IQOS Launch?

There is no change need. This is only about adding additional product/activity to the existing call mission

Every person in the field force will play a role in IQOS launch with some time allocated to diverse activities or full time focus. The final structure will depend on the phase of commercialization and the market specificity

There need to be separate field force structure built with all new required skills and activities.

What is the role of employees (beside the Field Forces) in the IQOS launch?

There is no specific role as all activities are performed by the Field Force

Employees should get the clear instructions from management team what every individual employee can do

Employees will play a critical role to become first ambassadors of the product via. Joining the Employee Engagement programs

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