Marketing Management I

Project Report
Product: Tetley Tea by Tata

Under the guidance of:

Prof. Archit Tapar Prepared by:
Group 7
Aman (PGP10128)
Sanjeevani Jadhav (PGP10145)
Jashandeep Makkar (PGP10146)
Maithili Choudhary (PGP10153)
Spandana Karna (PGP10179)
Serial No. Content Page No.

1 Executive Summary 1

2 Situational Analysis 2

3 Market Opportunities and Issues 4

4 Objectives 5

5 Generic Strategy 6

6 Customer Survey Analysis 7

7 Purchase Process 8

7 Marketing Implications 9

8 Perceptual Mapping 10

9 Product line Analysis 11

9 Product Lifecycle 12
10 Detailed Action Plan to Revive 13

11 Marketing Mix 18

12 References 19
Executive summary
The Tetley Tea from Tata ventured into branded tea in the late 1980s. The company realized that
despite having over 50 tea gardens varying across instant tea, flavored tea, decaffeinated tea, green
tea, and herbal tea across India, they had the tea but not the brand.
Tetley is one of the largest tea companies operating in 40 countries, selling over 60 branded tea
bags. It was founded in 1837 by Joseph and Edward Tetley and headquarters in England. The
Tetley group was created in July 1995, when a group of investors bought the then world-wide
beverages business. In 2000, the Tetley group was sold to Tata Group, which became the largest
overseas acquisition by an Indian Company.
The market of Tata Group suffered a lot after acquisition with reduce in overall sales by 8.3%.
Tetley Tea blended, packed, marketed and distributed tea to distinct markets- UK, Ireland, the US
and other commonwealth countries as it did not have own plantations. Due to difference in
consumer palates and uncertainty in availability of tea leaves, Tetley zoomed down to 40 different
varieties of tea from over 10,000 tea estates.
Tea is one of the most popular and affordable beverages consumed by Indians in more than 85%
of households. India is the 2nd largest producer and consumer of tea; and 4th largest exporter. The
industry provides employment to more than 3.5 million Indian workers. To encourage the growth
of Indian tea industry, Government of India launched a Special Purpose Tea Fund (SPTF) in 2007.
The objective of the fund is to extend financial support to needy tea estates for undertaking
replanting, replacement planting and rejuvenation of aged tea bushes. The Government further
protects domestic producers from foreign imports by imposing a 100% import duty on tea.
The product will be successful by positioning and selling high quality branded tea products. Tata
Tea is continuously working on innovation in brand marketing and sales which lead to growth in
recent years.

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Situational Analysis

Customers:
Tea is consumed equally in both urban and rural areas by all the income classes of the economy.
India accounts for 23% of the total world demand. Market value of Rs. 12000 crores.
Tata accounted for $2.5 billion sales in the tea sector at the time of acquisition of Tetley(2000).
Tetley majorly targets higher income groups such as middle class and upper-class people.
It targets youth and females especially housewives as they are the decision makers and the
influencers of a household which consumes tea
Close to 88% of the total households based on samples and surveys in India have reported
consumption of tea. Within the potential tea drinkers within a household, the penetration of tea is
around 96%. Overall around 64% of the total population in India is the tea drinking population.

Company:
● Focus on natural beverages like tea, coffee and water
● Tata heritage with global brand ownership and significant brand presence in over 40
countries
● 2nd largest tea company in the world with growing interests in other beverages
● 330 million + servings of our brands consumed everyday across the world
● $1.4 BN in revenues in 2018
● Over 3000 employees worldwide

Competitors:
Major competitors of Tata Global Beverages in the Indian market are Hindustan Unilever having
a market share of more than 28% as of 2018 and Wagh Bakri Ltd with a market share of 7.6%
Other competitors being Twinings Pvt Ltd, Amar Tea Ltd, Goodricke Group Ltd, Girnar Food &
Beverages Pvt Ltd

Collaborators:
2000: Acquisition of Tetley Tea
2006: Teapigs Incubated and Acquisition of 8 O'clock coffee

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2012: JV signed with Starbucks
2013: Agreement with Kraft
There are many acquisitions or stake acquirements by Tata but here only those are mentioned
which enhance its supply chain or help with its brand image in the beverage industry in particular.

Context:
● Political:
○ Government policies
○ Foreign laws
○ Stability of the government
Political arena has a huge influence on the spending power of consumers and cash mobility.
Also, different laws govern operation of the industry.
● Economic factors:
○ Interest rates
Rate of interest raises depressing business, causes reduncies, and spending problems.
● Social factors:
○ Customer Lifestyle
○ Workers and labourers Satisfaction
○ Language and demographic
Social factors differ from country to country and governs the business hugely. Consumer lifestyle
and trends also have its impact on the non-alcoholic beverages demand.
● Technological factors:
○ New machinery
○ Advancement in digital media

Technological factors covers from operation to supply and thus have it is a vital component for
competitive advantage. Recent developments in digital marketing, machinery, logistics etc can be
used to give an overall boost to the business.

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Market opportunity and issues
Opportunities:
● India is the world’s biggest producer and consumer of tea covering up to 23% of world
demand and sees huge opportunity in India for accelerated growth of consumer-packaged
goods. Tea is currently the second biggest in beverage category after the carbonated soft
drink market. With a population of more than 1.2 Bn and expected to expand at a CAGR
of about 1.5% between 2011 to 2026, the consumption demand for tea which is a popular
beverage amongst Indians is expected to remain buoyant. Furthermore, as per the National
Council for Applied Economic Research (NCAER), the number of households with an
annual income of INR 250,000 and above is expected to increase from the current level of
~22% in 2016 to ~27% by FY 2020. Rising population, along with a higher percentage of
people to be added in income group above INR 250,000 is likely to expand the potential
tea consuming population in India
● Rising awareness about the health benefits of organic tea or green/herbal tea coupled with
rising income has increased affordability for premium tea amongst the affluent segment of
the Indian population
● Tata Global Beverages Ltd (TGBL) has a very promising market. It will require innovation
in its core portfolio and scaling up business in chosen geographies in order to move up to
a far higher trajectory of growth, says its chairman N Chandrasekaran.
For the future, Chandrasekaran said, "Tata Global Beverages will focus on taking the right
strategic actions and building a strong set of future focused capabilities and platforms to
seize these opportunities. We have a strong brand portfolio, backed by the power of the
Tata brand, which will help us achieve our aspirations for the future."
The potential opportunities in India are as follows:
"The large Indian opportunity, over the years ahead, will see tens of millions of Indian
consumers across this vast country, aspire to use reputed brands that offer them very good
quality and value. This will undoubtedly lead to accelerated growth in India for several
categories of consumer-packaged goods, including tea, coffee and water. Across the world,
the trend towards health and wellness will also ensure that these natural beverages continue
to grow as preferred drinks.”

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 In 2018-19, Chandrasekaran said the Indian branded tea market, which is at the core of the
company's business not only witnessed healthy growth but also increased competition.
"The company has worked intensively at strengthening its position during the year, by
focusing on its flagship brands such as Tata Tea Premium through enhanced brand
investments, and also through multiple new blends of tea customized for the tastes of each
region," Chandrasekaran added
● In 2018-19, the company has recorded revenue from operations of Rs 7,252 crore with a
net profit of Rs 457 crore
Issues:
● Tata Tea is facing labor issues. The Nowera Nuddy estate, in Jalpaiguri district of northern
Bengal, has been closed since September 14, due to labour unrest. There have also been
frequent lockouts in Bengal tea gardens
● Average tea prices may remain sluggish given the record production levels both
domestically as well as globally. Consequently, prices cannot be risen after a certain level
● Even though there is a huge untapped rural market, capturing the same given the price of
Tetley is going to be challenging
● Overall, a core challenge ahead of the company lies in leveraging its strong assets,
including its brands, its deep category expertise and sales networks, to move up to a far
higher trajectory of growth

Objectives
Following are the marketing plan objectives-
● To make Tetley brand famous among the potential customers and increase its market reach
● To drive market awareness about the brand’s quality and goodness
● Focus on areas like organic and green tea
● Improve its Market share in other domains like ice tea
● Aware customer regarding health benefits of Black tea, Green tea, Masala chai etc
● Focus on flavors demand and market them accordingly

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Generic strategy

● Cost leadership
Tetley’s focus is not mainly on low costs, but it keeps it’s cost comparable to other
competitive products, focusing more on new innovations and products meeting changing
customer expectations and needs. It maintains its quality, with variety to satisfy and
maintain its customer relationships.

● Differentiation
With growing focus on health, Tetley is concentrating more on ‘Tetley Green tea’. It helps
people to cleanse from within and ensure a healthy wellbeing. To promote this, they have
also launched a film endorsing celebrity showcasing everyday situations that, despite our
intent, don’t allow us to resist indulgences every now and then. Taking green tea in routine
will make you feel more active is what they concentrate on promoting.

● Focus
Cost focus-green tea as a healthy drink and belly-fat reducing product emerged as the
strongest growth area . Both these campaigns have done much to attract young urban
consumers to green tea. As a result, green tea saw a 16% retail volume growth and value
growth of 25%. Overall, 2% retail volume sales in tea.

Differentiation focus-Tetley focused on the growing trend in the market among the
customers and their growing concerns of health. So, green tea product came out of this
growing trend to be the focus that would differentiate it from other normal teas and attract
more customers, especially the youth. Also other variants like masala tea, flavored teas and
ice tea are a few products that Tetley has come up with.

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Customer Survey Analysis
Triggers of Purchase:
Consumers demand and love for the tea is the starting trigger. Tetley green tea has 5X more
antioxidants than an apple which cleanses the body from inside and keeps the body active
throughout the day so health conscious customers prefer more green tea compared to other
variants. Goodwill and quality of TATA as a brand in India also made some of the customers to
buy and trust on Tetley. Another reason of purchase for the customers turned out to be that the
product was endorsed by their favorite celebrities like Deepika Padukone and Kareena Kapoor.

Criteria for consumer selection:

 Individuals having prior experience with the product

Individuals having substantial experience with Tetley tea were interviewed to gain insights in
understanding the purchase process efficiently.
 Tea connoisseur or an individual with a high tea consumption rate.
The opinion of someone who knows a lot about tea and can judge the quality, ingredients
affecting taste and nutritional value of tea, who could differentiate between different teas
provide valuable cognition. What are the factors that drive an individual to consume tea on a
frequent basis can be understood.
 Individuals following an athletic or healthy lifestyle.
Ingredients, their nutritional value and health benefits play a vital role in the purchase process
of a product that claims to be “healthy”. Interviewing individuals following an athletic or
healthy lifestyle helps in understanding the expectations consumers have from products like
Tetley tea, whether Tetley tea was able to meet them and how could Tetley tea improve if not.

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Stages in purchase process:
1) Need recognition
Inputs: - need for a refreshing drink because of green tea’s herbal and refreshing qualities
- Health benefits such as fat loss and improves physical performance
- Ready to drink tea
2) Information search
Inputs: - Compounds in green tea can improve brain function and makes a person smarter
- Lower the risks of some types of cancer
- Protects your brain in old age from Alzheimer’s and Parkinson’s
- Kills bacteria which lowers the risk of dental problems
- Lowers the risk of type 2 diabetes
3) Evaluation of alternatives
Inputs: - Other options in the competitive market are soft drinks, coffee, juices, energy
drinks, water, regular tea and black tea
- But the buying decision depends on the attributes that the person is looking for in
the product. And green tea appeals to most of the person who wants to stay healthy
- Tetley tea is known for its brand and most of its alternatives are local tea which are
not sold everywhere. So, people prefer Lipton green, Taj green and others.
4) Purchase
Inputs: - Needs of customer drives them to the product and their trust towards the brand.
Also, the variants, flavor and availability of the product in local stores supports to widen
the reach of the product and thus help in purchase decision.
5) Post purchase behavior
Inputs: - Tetley’s Green tea consumption actually gives customer a perception of Tetley
as a health-conscious brand and thus consumers relate themselves with the brand.

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The following played a major role at each stage during purchase:
● Internet research: Searching about the brand, its products, other brand options for the
same desired product, comparison of reviews and pricing, were the major deciding factors.
The customers found both positive and negative reviews during their research which made
them concerned about the quality and taste of Tetley teas. They found really supporting
reviews mainly for the green tea product. Those preferring Green Tea had satisfying and
convincing search results. Normal tea variant was not found up to the expectations.
● Cost of the product: A perception among the customers towards Tetley being an
expensive brand affects the buying decision of customers.
● Advertisement: Tata Tetley has concentrated its focus on advertising Green Tea. Hence
other products under the brand haven’t received much recognition. The Green Tea ad is
found to be very persuasive. Since no consumer likes restrictions on his/her eating habits,
Tata Tetley has resorted to using this very reason.
● Opinions from friends and known ones: Reviews on taste of the product from friends
and known ones affected the purchase decision of customers.

Time taken: The time taken for deciding upon purchasing varied from three to four days
across the customers depending upon the influence of the factors stated above.

Marketing Implications
● The main reason that the customers are buying our products is because of the health
benefits we offer them but we aren’t specifically focusing on that in our advertisements as
a result we’re losing out on some potential customers.
● There is a perception among customers that Tetley Tea is overpriced as a result they either
shift from Tetley to its competitors which are priced less as compared to it. Future
advertisements could include how Tetley is not overpriced and is nominally priced in
accordance to the value proposition
● A hefty amount of advertisements goes into the promotion of only Green tea as a result the
other variants suffer which could be rectified in the future allocations of advertisement
spending.

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 ● Aggressively target the health conscious and people suffering from diabetes, obesity or
other health issues which could be turned into potential customers

Perceptual Mapping

Tea Market in India

Less Healthy

Twinnings

Three Roses
Nestle
Wagh Bakri
Low Price

High Price
Brooke Bond

Taj Mahal
Himalaya Green Tea

Tetley Tea Lipton

Healthy

Reason for choosing these two dimensions:

1) Price: In the FMCG industry, daily consumption takes place so how the consumers
perceived the price of the product will always be a issue to address. Even here, it is quite
visible that it is perceived to be high priced as compared to the other price due to which
some price sensitive people don’t even try it.

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 2) Health: In the Tea market, if a brand like Tetley Tea is selling products like ice tea, green
tea, etc., it becomes extremely essential to consider health as an important measure for
consumer discretion.
Market Size: The market share/size as perceived by the customers has also been
considered which is determined by the circle size in which the brand name is there.
The above perceptual map has been created considering price and healthiness of the tea
brand in the Indian market and how it is perceived by the customers in the market. The
market share/size as perceived by the customers has also been considered which is
determined by the circle size in which the brand name is there.

Product Line Analysis

Product line Analysis of Tetley Tea
The various products under Tetley brand
a) Black tea - Tetley bold, Tetley Green Tea plus grow etc.
b) Herbal Tea - Tetley Mojito, Tetley Cleanse etc.
c) Flavored Tea - Tetley Chai, Tetley Earl Grey Vanilla etc.
d) Red Tea - Tetley Rooibos, Tetley Rooibos Red berry etc.
e) Super Green Tea - Tetley Super Green Tea Boost, Tetley Super Green Tea Immune
f) Ice tea blends and Tetley Long leaf green tea
Newest products by Tetley
a) Tetley Green Tea Plus: They are a blend of green tea plus aromatic flavors along with
unique customized ingredients.
b) Tetley Herbal cocktail-inspired tea: They are created for consumers looking for a
refreshing drink. They include Tetley Bellini, Cosmo and Pina Colada.
Product line analysis
I. In price range:
Cheapest Product Most Expensive product
Tetley long leaf pure original green tea (100 bags) : INR 85 Tetley pure original green tea (100
bags) : INR 450
II. In uniform packaging:
A product line can benefit by packing the product uniformly but still keep their individual
identities, it also helps the customer in easy identification. In India, Tetley produces Tetley
products in a box with a minimum of 100 bags at affordable prices.

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III. Equivalent quality: Consumers expect all the products are of equal quality with varied flavors
to suit their preferences.

Stage of Product life cycle of Tetley Tea

Tetley Tea was in Mature stage till early-2017 and has been declining, thus, entering into the
Decline stage.
During the Mature stage the product was established and the main aim was to maintain the market
share they have achieved. It is a very competitive stage and they have to be careful for their market
investment. Any improvements or new feature introduction that may give them a competitive edge
over others, is desirable.
Tetley made 6 new launches during 2016-17, namely, Tata Coffee Grand in three variants,
followed by introducing a Maharashtra-specific blend from the Tata Tea stable, next is Tea Veda,
which is an Ayurvedic tea infusion, and a flavored Super Green Tetley tea, fortified with vitamins,
beside a cardamom-flavored tea. The other introduction is Fruski, which was being experimented.
Also, it ventured into the ice tea segment in Indian market bringing in Orange and Mango variants,
with herbal extracts and low in sugar content.
The sales declined during the Q4 of 2018 mainly due to seasonality and unseasonal rains.
There were new introductions in the market that had better taste and were perceived less costly by
the consumers. Hence, the sales of Tetley started declining.

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Detailed action plan to revive Tetley Tea
STP Analysis for Revived Product
Segmentation
SEC implementation:
In the Socio factor, Tetley has not considered any particular society. But in terms of Economic factor,
Tetley brand is targeting mostly middle class and upper-class sections of the society. It depends on the
education and income level of the chief earner in the family. Further segmentation has been done on the
following basis:

1) Segmentation based on observable characteristics of customers

a) Taste preferences
Count of Which tea product have you
tried?
Green Tea 33
Green Tea; Masala Tea; Flavored Tea;
Black Tea 16
Masala Tea 9
Green Tea; Masala Tea 8
Green Tea; Flavored Tea 5
Flavored Tea 3
Green Tea; Masala Tea; Flavored Tea 3
Masala Tea; Flavored Tea 2
Green Tea; Black Tea 2
Black Tea 2
Green Tea; Masala Tea; Black Tea 2
Grand Total 85

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 Types of tea product preferred
35 33

30

25

20

16

15 Total

9
10 8

5
5 3 3
2 2 2 2

0
Green Tea Green Masala Tea Green Green Flavoured Tea Green Masala Green Black Tea Green
Tea;Masala Tea;Masala Tea;Flavoured Tea;Masala Tea;Flavoured Tea;Black Tea Tea;Masala
Tea;Flavoured Tea Tea Tea;Flavoured Tea Tea;Black Tea
Tea;Black Tea Tea

Out of the 33 customers who only prefer Green tea, only 4 customers opt for Tetley over
any other brand. The other brands preferred are Lipton, Taj Mahal, Brooke band.

b) Classification based on the gender who tried Tetley Tea

Count of Gender
Male 46
No 22
Yes 20
Maybe 4
Female 38
Yes 27
No 10
Maybe 1
Others 1
Yes 1
Grand Total 85

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 Classification based on the
gender who tried Tetley tea Gender classification
50 1%

40
Male
30
45% Female
20 Total
54%
Others
10

0
Male Female Others

43.5% of males have tried Tetley tea out of which 80% (i.e. 16 out of 20) were satisfied with the
Tetley tea product. In females, 71% have tried Tetley tea out of which 74.1% (i.e. 20 out of 27)
were satisfied with Tetley tea product.

2) Segmentation based on the benefits sought by the customer

Count of Are you health-conscious (on level of 1

Row Labels to 5) ?
1 ( Sloth) 3
No 2
Maybe 1
2 (Moody) 11
Yes 5
No 4
Maybe 2
3 (Sometimes) 42
Yes 26
No 16
4 (Frequently) 25
Yes 16
No 7
Maybe 2
5 (I am Milind
Soman) 4
No 3

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 Yes 1
Grand Total 85

Health conscious people who have tried Tetley Tea

30
26
25

20
16 16
15

10 Total
7
5 4
5 2 2 2 3
1 1
0
No Maybe Yes No Maybe Yes No Yes No Maybe No Yes
1 ( Sloth) 2 (Moody) 3 (Sometimes) 4 (Frequently) 5 (I am Milind
Soman)

As per our survey, 30.5% (i.e. 26 out of 85) consumers are sometimes health conscious who have
tried Tetley tea. And 18.8% (i.e. 16 out of 85) consumers who are frequently health conscious
have tried Tetley tea.
Target Market
a) Youth (18-24 Age group):
 Tea Connoisseurs
 A strong passion and taste quality great tasting tea
 Health conscious
 Middle class or above
As per the survey:
Age groups Regular users
16-18 7.6%
18-20 8.7%
20-24 64.1%
>24 19.6%
Health consciuosness (in youths)
Rating (Health) percentage
1 3.85%
2 13%
3 47.8%
4 31.5%
5 3.84%

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 b) Housewives (25-45 age groups)
 Health conscious
 Regular users
 Solid amount of disposable income
 Willing to pay high price for good quality of tea
 Gym, Yoga practitioners

As per the survey:

Gender Percentage users (>24 age)
Male 46.7%
Female 52.2%
Others 0.1%
Positioning

In this fast-moving world, trying to balance work and personal life, with hardly any time left for self-care,
let Tetley tea extend a helping hand to lighten the burden. To lovers of a high-quality tea who are seeking
a healthy option that provides comfort, taste and wellness, we introduce to you a new joy - Tetley tea, a
premium quality tea, refreshing and relaxing at the same time.

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Marketing Mix to revive Tetley tea
Product Price: Competitive pricing has been the key to
Tetley Tea is a subsidiary of Tata Global survival for Global Tata Beverages however
Beverages and they have always considered Tetley has been positioned as a premium brand
Tetley Tea as a premium product. However, by with a higher price, better taste and quality of
this, affordability is a major issue due to which the product. Tetley can adopt the offer and
it is not able to enter the small cities and rural incentive pricing in order to make the product
markets. Tetley can also come up with more appealing to the customers and enter new
products. The existing products are Black, and unexplored markets in India itself. Tetley
herbal, red, super green, ice and flavored tea can also come up with new variants and
and they have also recently come up with green product sizes which may lower the price of the
tea plus and herbal cocktail tea which will product to make it sellable in rural and semi-
answer the taste and quality issues but urban markets where people are price
affordability is still an issue. The different conscious.
variants can be introduced with smaller sizes
such as sachets and smaller packs which can be
used on a daily basis and require a lesser
disposable income from the household without
comprising the premium positioning of the
brand.

Place: As per the data maximum Tetley tea Promotion: According to the survey
users are concentrated near big cities and a few conducted, it was found that around 50% of our
states consumers are health conscious and most of
only, therefore to increase sales volume- new them were women. Therefore, we can target
market can be created by expanding reach to this age group and specially women through
small towns and rural areas. So, both robust social media focusing on women content. And
procurement and supply chain is needed. for the rural and small towns we need to
Considering the brand image, which can be increase awareness about the product and
used to fulfil consumers’ aspirational need. health too, hence organizing different health
related events such as; yoga. Also using brand

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 ambassadors from the same field can help in
the promotion too.

References

● https://economictimes.indiatimes.com/industry/cons-products/food/tata-global-seeks-
new-captain-to-power-its-fmcg-ambitions/articleshow/69966861.cms
● https://economictimes.indiatimes.com/industry/cons-products/food/now-more-indians-
prefer-to-have-tea-with-small-brands-like-wagh-bakri-amar-
tea/articleshow/59260789.cms?from=mdr
● http://www.tataglobalbeverages.com/docs/default-source/default-document-
library/investor-presentation---march-2018.pdf?sfvrsn=0
● http://www.adageindia.in/marketing/cmo-strategy/tetley-green-teas-new-
story/articleshow/63682154.cms?utm_source=contentofinterest&utm_medium=text&utm
_campaign=cppst
● https://qz.com/india/1474335/tea-gardens-to-tetley-a-brief-history-of-indias-tata-tea/
● https://www.business-standard.com/article/pti-stories/tgbl-needs-core-portfolio-
innovation-for-faster-growth-chandrasekaran-119051500959_1.html
● //economictimes.indiatimes.com/articleshow/59260789.cms?from=mdr&utm_source=co
ntentofinterest&utm_medium=text&utm_campaign=cppst

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