Innovation and Coping Strategy in the Modern Cigarette Industry: Evidence from Indonesia

This article discusses the coping strategies undertaken by the modern cigarette industry in the face of market competition and the pressure that squeezes its existence comes from ambiguous policies. The ambiguous policy is caused by the government still hoping for cigarette excise revenue as a significant source, but also because the government faces anti-smoking public demands that set cigarettes as a sunset industry. This condition does not make cigarette business actors give up, considering that the cigarette industry still contributes to employment, state income, and market demand. Using a qualitative descriptive approach, data sources of cigarette industry players were represented by the Kudus Cigarette Factory Entrepreneurs Association, the coordinator of cigarette factories throughout Indonesia. The strategy used by the cigarette industry to survive in addition to adjusting and responding to government policies oriented to regulate and manage laws in the internal sector that innovates in products, processes and markets.