Lipton Marketing Analysis

8/13/2019 Lipton Marketing Analysis

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LLIPTONIPTON

Marketing Management

Final Report

Submitted By:

Yasir Mehmood sp07-mm-015

Faisal Mumta! sp07-mm-00"0

#mdad $li Malik sp07-mm-00%&ahid Mumta! sp07-mm-01'%

$bdul (ha))ar sp07-mm-0005

Submitted *o:

Mr+ Farhan Bukhari

Submitted ,n:

0$pril 00%

2


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.ontents

S.no Topic Page

1.

Introduction 0

2. Value Chain Analysis

0'

3. Value Addition By Lipton

1"

4. Consumer Buying Behavior

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5. ecommendations

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nileer in 2akistan:

Unilever Pakistan Limited (UPL) was established some it! !ears ago in the then newl!

created Pakistan. The irst man"act"ring acilit!# a vegetable oil actor!# was set"p at

$ahim %ar &han in 1'.

Toda! Unilever Pakistan is a orce to reckon with. *ts contrib"tion to Pakistan+s

economic development cannot be overestimated. ,ow operating si- actories at dierent

locations aro"nd the co"ntr!# the compan! contrib"tes a signiicant portion o the

co"ntr!+s ta-es. *t emplo!s a large n"mber o local managers and workers. *t provides a

pool o welltrained and highl! motivated manpower to other segments and has

introd"ced new and innovative technologies into the co"ntr!.

The UPL /ead 0ice was shited to &arachi rom $ahim %ar &han site in the mid +s.

! this time the once d"st! and sleep! village was the h"b o activities or UPL. 4

residential estate sit"ated near the actor! is the home o UPL emplo!ees at $ahim %ar

&han.

UPL has also made an impact in other areas. The compan! has raised local standards o

5"alit!# saet!# h!giene# marketing# distrib"tions# labor relations and environmental

protection. *t has created s!stems and traditions em"lated b! other companies aspiring to

e-cellence. 4nd more than an!thing else# it has kept its ingers on the p"lse o cons"mers

to give them prod"cts the! tr"st. 6alda# Lieb"o!# S"r# L"-# Lipton# rooke ond#

S"nsilk# &norr# 7air 8 Lovel! and 9alls amongst others are some o the bestloved

ho"sehold names in Pakistan

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The compan! has ollowing o"r b"siness "nits;

1. /ome and Personal


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Ba3kground - 4ipton:

Sir Thomas Lipton a Scottish born entreprene"r decided in 1 that he wo"ld make tea

accessible to all at acceptable prices with a g"aranteed 5"alit!.eore this tea had been an

e-pensive beverage onl! or the rich.*n 1'3 he established Thomas > Lipton


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Market Share in *ea Se3tor 6ara3hi

8stimated Shel) Share in Mi9ture Market

C

Rest

32%

Lipton

28%

Tapal

40%

-"+1

/'+1

1+-

7%+1%%+1

11+"

"5

00

10

-0

"0

0

50

/0

70

%0

'0

*otal 6ara3hi Sindh Balo3h

4eer

*apal

,thers


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*hese )igures sho the market share o) the oerall tea industry in#a$istan.

Supreme

26%

Tapal

Family

Mixture

11%Loose15%

Other12%

Yellow

Label

20%

Dae!ar

16%


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;alue .hain $nalysis

Dal"e chain is a highlevel model o how b"sinesses receive raw materials as inp"t# addval"e to the raw materials thro"gh vario"s processes# and sell inished prod"cts to

c"stomers. The val"e chain provides a s!stematic basis or anal!=ing the activities that an

organi=ation perorms. Thro"gh these activities the organi=ation creates val"e. The goal

is to deliver ma-im"m val"e to the end "ser or the least possible total cost.

The val"e chain model is a "se"l anal!sis tool or deining a irm+s core competencies

and the activities in which it can p"rs"e a competitive advantage. The irm can care"ll!

anal!=e their val"e chain and create a cost advantage b! better "nderstanding costs and

s5"ee=ing them o"t o the val"e adding activities or it can dierentiate itsel rom its

competitors b! oc"sing on the core competencies.

2R#M$RY $.*#;#*#8S:

These are the val"e creating activities o the organi=ation. The! incl"de;

#nbound 4ogisti3s:

$aw (semiprocessed) tea is received rom vario"s co"ntries. *t is stored in Lipton+s

wareho"se which has state o the art e5"ipment. The plant where inbo"nd logistics as

well as operations occ"r# is located at 9est9har in &arachi.

,perations:

%asting

Tea tasting is a science o its own. Unilever has hired teatasters# who are people act"all!

trained or the p"rpose o disting"ishing between dierent teas. The task o these highl!

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skilled e-pert Tea Tasters is to sample teas and ens"re the! are blended to the highest

standards o Lipton.

Blending

6"e to tea blending# a single tea bag o Lipton contains as man! as : dierent t!pes o

tea. *t is rom blending that their diverse s"btle

lavors and tones are drawn. 4s a res"lt# a tea garden is able to prod"ce teas o dierent

5"alities d"ring a single season. 7or tea blending# the

compan! draws on talents o Unilever?s rooke ond Ltd a gro"p o e-perts ens"ring

that cons"mers get the best Lipton tea taste. Teas rom &en!a are "sed or brightness and

color# Srilankan tea and angladesh tea or mellowness.

2a3kaging

4 "ll! a"tomatic acilit! is "nctional at the 9est9har vicinit! in &arachi. 4t this

acilit! tea is packed in h!gienic conditions# in the bright cheer"l !ellow color that has

become s!non!mo"s to the Lipton brand.

,utbound 4ogisti3s;

Unilever has a strong distrib"tion network or its Lipton Tea brand# spread across

Pakistan. The have : distrib"tors nationwide.

Sales < marketing:

7rom print campaigns to TD advertisements# Lipton brand is omni present. The brand is

also marketed d"ring dierent asant estivals# concerts etc. $esearch regarding beneits

o tea is oten presented "nder the P"blic $elations marketing.

Seri3es:

Tea is an 7E


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Lipton+s prod"ction polic!# and the J"alit!


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;$48 $>>#*#,? BY 4#2*,?

! care"ll! "nderstanding their val"e adding activities# Lipton has been able to create

val"e addition or their c"stomers# compan! and econom!.

D4LUI 466*T*0, 70$ T/I


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Eonetar! cost;

Lipton oc"ses on delivering the val"e# and satis!ing the cons"mer or the amo"nt he

pa!s to b"! this tea.

Time cost;

I-tensive distrib"tion allows Lipton to be available at all t!pes o s"perstores and pan

shops so the cons"mer can go an! place convenient and b"! tea.

Inerg! cost;

,o partic"larl! e-tra energ! is "sed in going o"t and b"!ing Lipton. The cons"mer

spends onl! that m"ch energ! as ma! be needed or a t!pical grocer! item.

Ps!chic cost;

There is no ps!chic cost attached to the process o teap"rchase.

D4LUI 466*T*0, 70$ U,*LIDI$ % L*PT0,

9itho"t increasing an! cost or the compan!# Lipton has been able to ma-imi=e the

compan!+s proits a lot. /owever# it has not been able to deliver the e-act val"e to its

cons"mer. The marketer m"st be able to ma-imi=e proits rom the cons"mer+s end b!

providing them the perect val"e. 4t o"r end# we believe that Lipton has not been able to

achieve it to the ma-im"m# "p till now. 7or this ver! p"rpose# the recommendations

d"ring the entire creating# delivering and comm"nicating the val"e process have been

proposed in this report.

1:


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1

L*PT0, TI4P$0


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1

0T/I$ TI4 F4$6I,S

L*PT0, TI4P$0


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Strategi3 2artnerships ith *ea pro3essing 2lants

Tea is an agric"lt"ral commodit! and 5"alit! and 5"antities prod"ced b! an estate will

var! dependant on climatic conditions. 4s no single estate can prod"ce eno"gh tea o a

consistent standard over a 12month period to meet Lipton+s re5"irements# it is necessar!

to b"! rom a wide range o tea estates to ens"re a consistent 5"alit! prod"ct. %et# or a

constant s"ppl! o 5"alit! tea to meet the local demand# Lipton can have a strategic

alliance with the s"ppliers. This wo"ld red"ce the b"!ing at a"ction ho"ses and give the

compan! more control on the price o tea p"rchased. This step wo"ld also save the time

between the tea pl"cking at the gardens and inal processing at the &arachi actor!.

=urther ;evelopment of Lipton Tea ardens

Pakistan is the third largest importer o tea. Pakistan?s import bill o tea comes to M21

22 million per ann"m. To overcome this sit"ation# we propose that Lipton sho"ld sign

an agreement with Pakistan 4gric"lt"re $esearch


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=orward 5nteration

Lipton# is s"pported b! the Unilever inrastr"ct"re. *t has ac5"ired its own network o

distrib"tors. 0ther than retailers# these distrib"tors provide tea stocks to

schoolGcollege and oice canteens.

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.onsumer Buying Behaiore3ision 2ro3ess:

4s tea is a lowinvolvement prod"ct# thereore cons"mers don+t take time to decide

which tea brand to b"!. rand lo!al cons"mers will move directl! rom problem

recognition to p"rchase decision# whereas non lo!al cons"mers will search or

inormation regarding dierent tea brands# their ma@or comparisons will be on price.

1+ 2roblem needAre3ognition

The need or tea arises when the cons"mer wants to get rereshed and active. The

need can be triggered b! internal or e-ternal stim"li.

#nternal Stimuli:


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+ #n)ormation Sear3h )or a produ3t

This need or tea makes the cons"mer to go to dierent places 8 search or the

right tea.

Su33essie sets inoled in .onsumer >e3ision Making

"+ 8aluation o) alternaties


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+ 2ur3hase de3ision

4ter seeking all the alternatives# cons"mers will go or the brand which the! ma!

ind most attractive 8 appealing.

5+ 2ost-pur3hase behaior

9hen the cons"mers ind the prod"ct the! have bo"ght to be ver! good# the! will

again 8 again b"! that prod"ct. * not# post p"rchase dissonance ma! occ"r which

can be ver! bad or an! compan! beca"se the cons"mer ma! stop "sing the

prod"ct -eit option2or bad mo"th abo"t it to others -voice option2.

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?eed Re3ognition

9hen cons"mers reali=ethe need to b"! tea

#n)ormation Sear3h

9hen cons"mers (non lo!al) searchor inormation regarding teabrands

2ur3hase >e3ision

9hen cons"mers act"all!b"! the prod"ct

8aluation o) $lternaties

Ival"ate dierent alternativeseither b! "se"l calc"lations orb! ease o availabilit!

2ost 2ur3hase Behaior

,egative or positive

opinions

$ep"rchase


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Fa3tors $))e3ting the Buying >e3ision:

#nitiator

7riends and relatives "s"all! give the s"ggestion or a partic"lar tea brand.

#n)luen3er

7riends# peers and the media pla! the role o an inl"encer in b"!ing tea.

>e3ider

Us"all! the women decide which tea to b"!# partic"larl! ho"sewives.

Buyer

"!er is "s"all! the lad! o the ho"se# who b"!s ever!da! groceries or her ho"se.

ser

The whole amil! "ses the tea.

Fa3tors #n)luen3ing .onsumer Behaior:


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Sub-3ulture:- S"bc"lt"re is c"lt"re with in c"lt"re that has distinct val"es. 7or

e.g. in Sindh people preer strong tea as compared to people living in P"n@ab and

al"chistan where tea is drank with lots o milk (doodh patti).

So3ial .lass:-


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2ersonality:- Personalit! also pla!s a ma@or role in b"!ing decision process.

/eav! tea and coee drinkers are high on sociabilit!.

2sy3hologi3al Fa3tors

ealerDs 3hoi3eA S"permarkets# $etail Stores.

2ur3hase timingsA Eonthl!# J"arterl!.

2ur3hase amountA Large Pack# small Pack# teabags# sachets.

.onsumer Behaior Model:

#?;,4;8M8?*

=igh 4o

2:


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=igh Brand >i))eren3es

4o Brand >i))eren3es

Lipton has been placed in the variet! seeking b"!ing behavior beca"se cons"mers b"!

Lipton on the basis o taste. 4mong all the choices available in the tea categor!# Lipton

has a more s"btle taste and so onl! those people will b"! who preer this taste. Since tea

is prett! m"ch tea# the involvement is low.

4roma# taste and color are the three actors on which the 5"alit! o tea is @"dged. Tea is

perceived to be o highest 5"alit! i it rates high on all the three actors. Pakistanis preer

tea to be strong in taste and aroma and rich in color. Eost brand dierences are created

b! dierentiating on these actors.


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Re3ommendations:

#nolement

=igh 4o

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=igh Brand >i))eren3es

4o Brand >i))eren3es

Better #mage 2ositioning

To shit Lipton towards a high involvement side# it sho"ld be positioned s"ch that

the c"stomer eels thoro"ghl! satisied with the Lipton tea. 4 high brand val"e

sho"ld be created and comm"nicated eectivel! thro"gh branding and

distrib"tion. Lipton sho"ld be positioned in s"ch a wa! in the c"stomers+ minds

that the! become brand lo!al. Lipton sho"ld tr! to create a brand believe in the

mind o cons"mers. *t sho"ld create brand amiliarit! b! contin"o"sl! repeating

the advertisements.


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Better Shel) Spa3ing:

.an you )ind out here 4ipton isC

*n the cl"tter o teas# Lipton does not stand o"t even i it has the distinct bright

!ellow color.

9e do not s"ggest an! package color changes as we reali=e that Lipton is a global

brand. *n o"r opinion# Lipton sho"ld "se some retailerintegration strateg!

whereb! it can place its prod"ct line at more prominent and attractive stands in

the shops.

.reate *he 4ipton 89perien3e:

! diversi!ing its prod"ct line into Tea 9hiteners# cardamom lavored Lipton

tea# or Lipton 3in1 sachets Lipton read!tomake tea (make a new package with

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tea and cream powder). >"st add water 8 s"gar to !o"r taste and en@o! the "ni5"e

lavor o Lipton (like ,escae). *n this wa!# Lipton can create an a"ra o the brand

at the breakast table# at tea time and inact# at an! time when cons"mer wants tea.

Lipton sho"ld target the home maker and those women who make their own

decisions. The advertising o Lipton and sho"ld have a to"ching appeal as it sends

a message to women being the grocer! b"!ers and deciders or the whole amil!.

7or theLiht usersLipton can do a market research and ind o"t what is the best

5"antit!price package the home "sers look or and then target this segment with

an appropriate marketing plan.

Lipton sho"ld target health conscio"s peopleN the! sho"ld come "p with a new

prod"ct which co"ld be targeted as a health drink.


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Lipton sho"ld not sign an! contract with an! teagardens "nless the! become partners in

its 5"alit! ass"rance program.

Lipton Marketing Analysis

Documents

Transcript of Lipton Marketing Analysis