lipton (final)

8/3/2019 Lipton (Final)

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Institute of Business &Technology

Program: M.B.A (Evening)

Presented to: Sir. Ahsan Nawaz

Group members:

M. Nadeem Baig (BM-25390)

M. Ovais Sabir (BM-25386)

Yasir Rasheed (BM-25396)

By


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Letter of Transmittal

April 19, 2011

Sir Ahsan NawazBIZTEK


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Respected Sir,

Here is the report you requested entitled Lipton Tea, along with therecommendation of uses of Tea. The study includes both primary andsecondary research. The primary study focused on a Lipton tea companycurrently operating in the market.

Although the import of Tea has increased in recent years,Recommendation is to exploit the opportunities of self cultivation can beexpanded enough to make Pakistan quench the consumer market withinthe country.

Through the course of the term, we were given the opportunity to learnmuch about the tea industry and import business in general. We feel thatthis knowledge will be helpful in future work terms, and in our career.

Sincerely,

M. Ovais SabirYasir RasheedM. Nadeem Biag

Acknowledgement


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Our heads bow before our first and for most guide, our beacon and

strength, the ALMIGHTY ALLAH. Thank you ALLAH for giving us strength,

knowledge and power to stand-up after small failures, and for impossible,

possible for us.

As best is always saved for the last, well always be obliged to our dearest

teacher Sir Ahsan Nawaz, who guides us in shaping this report and

enhancing our skills for report writing.

Table of Content

1. Introduction of company

2. Target markets


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3. Buying behavior

4. Competitive strategy

5. Branding & Packaging

6. Marketing Mix

7. Product life cycle

8. Recommendation

9. Conclusion

Introduction of company

Unilever was formed in 1930 when the Dutch margarine company Margarine Unie mergedwith British soapmaker Lever Brothers. Both companies were competing for the same rawmaterials, both were involved in large-scale marketing of household products and both usedsimilar distribution channels. Between them, they had operations in over 40 countries.Margarine Unie grew through mergers with others margarine companies in the 1920s. LeverBrothers was founded in 1885 by William Hesketh Lever. Lever established soap factoriesaround the world, and had plantations in many Third World countries. In 1917, Lever beganto diversify into foods, acquiring fish, ice cream and canned foods businesses.


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However, in spite of Unilevers vast size and presence worldwide, the companys actualvisibility is surprisingly low. Anonymity hides the companys importance. Unilever does notretail under its own name, preferring brand names to create the illusion of diversity. Whodoes not know brand names like Magnum, Omo, Dove, Knorr, Ben & Jerrys, Lipton, Slim-Fast, Iglo, Unox, Becel, and Lever2000? Theyre all part of the Unilever armada of brandnames. To make sure the brand names do not go unnoticed, Unilever spends huge amountsof money on marketing and advertising. Advertising has always been a keystone of

Unilevers businesses.

Our Assignment

Unilever is offering various products with their many variants including food and home andpersonal care products. We selected Lipton Yellow Label as our assignment. Lipton YellowLabel is one of the world's great refreshment brands. In Lipton we have few variants such as:

Lipton Yellow Label pack

Lipton Yellow Label Value Pack

Lipton Yellow Label Jar

Lipton Green Tea

Lipton Green Tea Jasmine


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Lipton Green Tea Mint

Lipton Green Tea Lemon

Lipton Yellow Label

Lipton is one of the world's great refreshment brands, making a big splash in the global

beverages market; it is the epitome of international quality. Lipton Yellow Label's assuranceof quality has helped it become the world's largest selling tea brand. Specially plucked fromthe best tea gardens of Kenya and blended to perfection - it is truly the gold standard in tea.The 100% International Blend - made with one of the best technologies available in theworld, has been brought to you to provide the finest tea drinking experience.

Competitive Strategy

COMPETITORS ANALYSIS

The tea industry is divided into two segments. They are:

Branded Tea Unbranded Tea

Lipton is facing a tough competition from both the segments as theunbranded tea has almost half the share of the total tea industry. Thecurrent tea imports are 140,000 tons.

The major competitor for Lipton is LIPTON especially as the salescompetition from this brand in the tea industry is getting cut throat. Liptonis a clear market follower in all over Pakistan as it caters to all the areasrural and urban alike. Lipton Yellow Label is definitely a market leaderclaiming that it is a premium top of the line product with a sign of goodtaste. Lipton has countered this competition strategically by creatingpositioning and brand pull in customers mind so that they have a separateidentity of their own. Catchy slogans like HER LAMHAY KI CHAH forLipton Yellow Label Tea, focusing on the free and radiant spirits of theyouth which has also been tagged along with ZINDAGI MAIN BHARONAYA RANG is the slogan

For Lipton, this positions on the completeness and togetherness of thefamily and position Lipton integral part of the Family.


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Target Market

In order to reach the target market we at LIPTON went through a numberof steps to identify the potential customers. The target market at the endof the day becomes the most important aspect for LIPTON to target and

satisfy the needs and wants in the best possible way yet yielding profitsfor the company. These steps are: market segmentation, markettargeting, and market positioning. The whole market segmentation aspectis covered in the following tables which uses the segmenting variables.

Segmentation


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Macro Environment

Political:The first element of a PEST analysis is a study of political factors. Politicalfactors influence organisations in many ways. Political factors can createadvantages and opportunities for organisations. Conversely they can

Geographic: Karachi & Lahore

Density Urban

Climate Can be taken cold as hot conditions are more prevalent

throughout the year.

Demographic:

Age 5 years and above

Income Rs.30, 000/- & above

Social class Upper and upper middle class

Psychographics:

Life style Value oriented, sociable & active

Personality Compulsive, health conscious & ambitious

Behavioral:

Occasion Regular & special occasion

Benefits Quality, economy, nutrition, uniqueness andconvenience

User status Non user, potential user and first time users


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place obligations and duties on organisations. Political factors include thefollowing types of instrument:

- Legislation such as the minimum wage or anti discrimination laws.- Market regulations- Trade agreements, tariffs or restrictions- Tax levies and tax breaks

- Type of government regime eg communist, democratic, dictatorship

Economic Factors:

In Pakistan, the purchasing power of the consumers is increasing. The richfamilies are becoming richer and the poor families are becoming poorerthus the economy is becoming more saturated. However due to theoverall economic developments, the life style of the people is improvingand thus purchasing power has enhanced.

Socio-Cultural Factors:

In Pakistan, the concept of tea is that of a hot drink that is served withmilk, which is taken in the leisure time. On the other hand the productthat we intend to introduce is totally on the contrary. Our product is astrawberry flavored instant tea drink more like a shake served in canswith extra wide straws to enjoy the drink while chewing the tapioca ballsthats not only exciting but a part fun.

Technological Environment:

We at LIPTON are aiming to provide a high quality LIPTON YELLOW LABELusing the latest technology available. Tea blending and tasting is consideredtop priority at LIPTON. In order to do this we require a tea manufacturingplant through this modern facility tea is going to be blended and packaged inhygienic conditions untouched by human hands. In order to utilize the latesttechnology we intend to launch LIPTON YELLOW LABEL in metal free Plasticcans. This technology will help us in keeping the tea fresh and packagingcosts economical.


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Branding & Packaging

Delivering on Customer Desire Relevance Value Positioning Portfolio

Integrated Marketing Activities Management Support Monitoring

The desirable taste for tea in Pakistani market, especially in Karachi isstrong. Liptons taste is weaker than what the average consumerdesires.

Liptons Packaging


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Weakness:

Showing black tea onthe packet while 90%of consumers drinkmilk-based tea.

ProposedCan show fresh green

leave which May ad nice effect? Can show milk-based tea which theconsumer can relate to.

MARKITING MIX (4 Ps)1) Product

Lipton Yellow Label Tea is a brand extension.

Branding:

LIPTON is already a well established brand in Pakistan. Therefore,customers would not have any issues regarding the quality of LiptonYellow Label Tea.

Especial attention would be paid to its design. The design of the packetwould be delicious.

Packaging:The packaging would be done in yellow and orange colour so as to giveeffect of rising sun. The purpose of packaging would be to protect thedrink and to attract consumers with the presence of the shiny sun whichattracts the consumers that by drink Lipton yellow label tea they starttheir day with refreshing and full of energy with great thoughts.

Labeling :

The labeling of Lipton Yellow Label Tea would consist of Logo of LIPTONalong with the name Yellow Label Tea. It would have Lipton Yellow LabelTea content along with its

Date of manufacturing, when it was made.


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2) PLACE:

After the tea is manufactured it would be send to distribution centers fromwhere it would be distributed to retailers. This would be followed in all thecities where Lipton Yellow Label Tea would be launched.

Factory

Distribution canter

Retailers

Customers

3) Pricing:

LIPTON would follow market penetration strategy for its Yellow Label Teain the beginning.Factors which would be involved in setting price are:

Costs:

Fixed and variable cost would influence the pricing of Lipton Yellow LabelTea

Elasticity:Our Tea drink is not considered a luxury product and not an essential fooditem therefore it has elastic demand a rise in price would cause thedemand of Instant tea drink to decrease and a decrease in price wouldprobably lead consumers to buy more.

Competition:

Our Lipton Yellow Label Tea prices may not be affected by competition asLipton Yellow Label Tea is the innovative product that is uninitiated inPakistan and a niche thats untouched by other competitive companies.

4) Promotion:


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Budget for Advertising:

Promotions through hotels and restaurants: Rs. 0.8 millionAds would be placed on different channels to capture larger market andalso to inform customers of new trends hitting the tea industry.

Local Newspaper expenditure:

Rs.0.2 million for newspaper ads would be placed on Sundays andSaturdays rather than the whole week as it will reach more customers andhighest target market.Billboards and companys activities together, account for approx 0.5million in the advertising budget.

Product Life Cycle

Introduction Growth MaturityDecline

Implications

The industry is in the maturity stage, so competing firms in order to gain

market share, constantly innovate and frequently use price-cutting. They

also increase communication channels like advertising and sales

promotion to entice brand switch. Green tea has is in the growth stage

and we believe that there is a potential for growth given that green tea

provides health advantage. Thus this property will attract health conscious

people. Ice tea is in its introductory stage, it was recently test marketed inKarachi which resulted in a successful response in future it will be coming

BLACK TEAGREEN TEAICE


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up with new flavours and has a potential to gain a large market share as

soon it is launched nationally.

Recommendations

Market:

The need is to first develop a segment on the basis of their needs, andthen focus should spread upon their needs. They should be updated withthe latest trends in the market, what are the needs and changes takingplace in market. They should go for market research to change the latesttrends and changes in the market segments.

Segmentataion:Unilever at this time has segment its market much biger and certainirrelevant portions which are not enough profitable.

The following lists the recommendations for Lipton with regard to:

Brand positioning of Lipton iced-teas:

As more segments are targeted, the product should offer greater flexibility

and choice to cater to a wide range within each segment. For example, it

could offer different types of packaging, and in different quantity (volume)

with different prices.

Conclusion

The tea import bill mounts to US-$ 220 million in 2008 and the population

is 164 million this implies a US-$ 1.3/person (Rs 104/Person) of tea in a

year. The import share of tea is 13% from total imports and trend analysis

shows in increasing trend. This is mainly due to the economic boom from

2002 2008 where consumer markets have been steadily. Other facts for

import bill to increase are currency devaluation and inflation. However,

this does not explain the deceleration in the rate of increase in import.

The consumer market in Pakistan does not have many branded teas

(Tapal and Unilever being prominent). The market is like with the culture

indulgence of tea and the brands are exploiting this for their sales

campaigns. Companies have strategically launched different contains a


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special place in Pakistani culture so it has a significant impact on bonding

families and promoting a non-alcoholic environment.

lipton (final)

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