History of Lipton Tea

Lipton Tea is a British tea company, founded and named after its original owner, Sir
Thomas Johnson Lipton. Lipton tea began in1870 and is currently one of the biggest
tea distributors in the world.
Origin of Lipton Tea Legend Myths and Facts
Lipton was born in 1850, in Glasgow, Scotland. In 1865, Lipton moved to the United
States where he held various jobs, including working on a tobacco farm, a rice
plantation and a streetcar. Lipton, Lipton returned to Scotland and opened his own
grocery store in 1871 .Lipton pioneered the idea of selling tea as individual packets,
for longer freshness, consistent quality and guaranteed weight.
Lipton tea today
Lipton tea is now one of the largest tea traders in the world. It is currently owned by
the Unilever Company.
Objectives
The aim is to provide quality tea that is safe for the health and energizing for
the mind and body with an unforgettable flavor.
Lipton has to retain its position as a market leader against all its competitors
especially Tapal who is its challenger and close substitute.
It has to interact directly with the consumers in order to be aware of the
requirements and expectations of its consumers.
It has to maintain the highest satisfaction standards and goodwill among the
consumers.
It has to maintain its brand name and loyalty.

Market research analysis

Market research analysis is conducted by adopting following techniques and
methods to input information in this report
TYPE OF RESEARCH:
The Research type is Observational. Involves gathering primary data by
Observing relevant people
Actions and situations
Group discussion

Data collection methods

1. Observation:
2. Structured and unstructured Interviews:

3. Questionnaires:
General Questions
About the product
Primary data
Office Tours (wazirabad 1/2012) Office visit has been conducted to get basic
information about the uniliver Company, itsobjectives and products Uniliver office
Moti bazaar, Islamabad mor wazirabad.

Secondary data
Websites
WWW.UnileverPakistan.com.pk
WWW.lipton.com.pk

Market plan and strategy

SITUATIONAL ANALYSIS
MICROENVIRONMENT FACTORS
Microenvironment of a company is all the factors that affect its ability to serve its
customers. Itincludes the company, suppliers, marketing intermediate, customer
markets, competitors, and publics
1. The Company
Unilever was created in 1930 when the British soap-maker Lever Brothers
merged withthe Dutch margarine producer, Margarine Unie.
Unilever Company came into the Pakistan market in 1949 with the name of
Lever Brothers Pakistan.
Changed the name Lever Brothers Pakistan to Unilever in year 2003.
The average per annum consumption of tea is 150 million kilograms.
Suppliers
More than 150,000 outlets in Pakistan including

Super stores
General stores
Grocery stores
Discount stores
Departmental stores

650 distribution offices with Head quarter in Karachi

1.
Marketing Intermediaries

Unilever marketing intermediaries have played an effective role in

distributing its products.
Physical distributers
Financial intermediaries
These have strongly helped the company in promoting its products.

1.Customers
Number of people familiar with tea around the world
MACRO ENVIRONMENT FACTORS
Microenvironment factors are all the societal factors, which affect the company;
these include demographics, economic, natural, technological, political and cultural
forces.
1. Demographics
Generally people consume 2-4 cups of tea per day.The demographics include

Age
Location
Gender
Race
Occupation.

The potential market of Lipton is the people aged 10-60; it does not target the
children.
2. Economics Forces
Economic forces in a macro environment are:

Economic growth rate

Unemployment rate
Inflation rate
Interest rates
Infrastructure quality
Business cycle stage (e.g. prosperity, recession, recovery)

3. Cultural Factors
Pakistan has produced unique cultural of its own type.

Values

Norms
Cross culture

Target market
Targeting of Lipton:

Lipton Yellow Label is working in more than 110 countries therefore the target
market is aglobal village that consists of people with different cultures, taste, habits
& food.

It targeted the urban areas (offices, hotels, restaurants, caf, and banks)
Lipton is targeting for upper middle, upper lower and upper middle class
The teabags are targeted toward the upper high class.
Soft packs and jar packs are targeted for middle and middle lower class.
The age group segment selected for Lipton is between (15 60)
It is targeting to those people who are young, trendy, cosmopolitan, hip, and
cosmopolitan.

MARKET SIZE CALCULATION

The Market size is:
NUMBER OF BUYERS = 0.444 Million
MARKET SIZE = NUMBER OF BUYERS * AVERAGECONSUMPTION
THEREFORE 0.444 * 48per year = 21.312Million

Market Segmentation
Market Segmentation Of Lipton Yellow Label
Distinct needs - regular tea/ green tea /black tea
Characteristics taste, aroma, strength
Behavior in terms of 4 Ps Segmentation of consumer market
CURRENT STATUS OF SEGMENTATION
There are two clear segments of consumers in the market, branded tea consumers
and un- branded tea consumers. In Punjab, the majority of rural areas are absolutely
brand loyal while unbranded tea is only popular in teashops and hotels
Geographic Segmentation:

World region
Country
Cities
Density
Climate

Asia
Pakistan
All major cities of Pakistan
Urban-Rural
Hot & dry

Demographic Segmentation:

Age
Gender
Family size
Family life cycle
Income
Occupation
Education
Religion
Race
Nationality

All age group

Male, Female
1-2,3-4,5 above
Married & Unmarried
12000 above
White collar & service workers
School, colleges & Universities
All
Asian
Pakistani

Behavioral Segmentation:

Occasion
Benefits
Loyalty Status
Readiness Stage
Attitude towards brand
User Status
User Rates

Any occasion
Quality, taste, flavour and brand status
Significantly high
Awake & interested
Positive & enthusiastic
Ex-user, regular user, first time user
Medium user, heavy user

Psychographic Segmentation: Social Class

Lifestyle
Personality

Middle class and upper class

Actualizes, Fulfilled, Believers, Achievers
Cultured, energetic.

USE-SITUATION SEGMENTATION

Occasions
Objective
Location
Person

Regular and parties

To feel fresh and healthy.
Home, office
Self, family members, friends

Level of competition
Market competition:
The tea market in Pakistan is very well saturated because of the high consumption
of open teawhich accounts for over 60% of tea sold but if we look at the branded

tea market there Brooke bond leads the market in branded tea, while Tapal being
second and Lipton being third in termsof sales with other small brand of Unilever
and Tapal also laying claim to the market.
Primary competitive alternative
The primary completive alternative of Lipton Yellow Label is Tapal Danedar Tea.

Tapal Danedar
Tapal is a well known name in Pakistan. In 1947, it started business and now is a
Tealeader in the tea market of Pakistan.
Competitive Rivalry
1.

Tapal Danedar Tea

Started in 1947 by Tapal Family.
Largest Pakistani owned Tea Company
Innovation
ISO Certification
Tapal Danedar and Lipton Yellow Label are primary competitive ofeach other
they are they competitive because they target the sameconsumers for same
type of people there Target market is same. Theyalso have slightly difference
in there prices,

Major Players and competitors:

Marketing mix
The Marketing Mix (The 4 P's of Marketing)
Marketing mix (decisions) generally fall into the following four distinct categories:
1.
2.
3.
4.

Product
Pricing
Place issues(distribution)
Promotional tools

Product
The product name is Lipton yellow label that has astrong brand image in the
consumer mind. It is regular tea that has a strong taste, aroma, and strength.
Product line

Black tea
Green tea
Flavored black tea
Herbal tea

Pyramid tea
Iced tea mix
Iced tea to go
Lipton pure life tea
Lipton iced tea
Food service
Lipton brisk

Price
Lipton Yellow Label has never wanted to compromise on quality so they
adoptedvalue based pricing.
Different prices of packs of Lipton yellow label tea in Pakistan:
Product category
1.

2.

3.

Packets (Sachet size)

14gm
30gm
95gm
Packs (medium size)
190gm pack
380gm pack
Box &jars (large size)
25 tea bags box
100 tea bags box
950gm soft pack

Prices
Rs10
Rs 20
Rs 65
Rs. 160
Rs. 295
Rs. 95
Rs. 185
Rs. 690

Distribution /placement issues

Distribution is about getting the products to the customer. Some examples of
distribution decisions include:
Distribution channels
Lipton yellow label being a consumer good follows an intensive and selected
distribution policy in the placement of its products it tries to reach its consumers
any where and every where.
Distribution places
1. More than 150,000 outlets in Pakistan including
Super stores
General stores
Grocery stores
Discount stores
Departmental stores

2. 650distribution channels, 3majors units manicuring in Karachi, Raheem

yarkhan and khaniwal.

Promotional tools
The Lipton Yellow Label does it promotion in following ways.The company uses
different promotion techniques they provide different items toPeople such as:

Caps
Tea bags
Cups
Printed T-shirts
Discounts
Basant festivals
Vans
Watches

The company takes different sales promotion techniques at different time period for
the salesof the product.
Electronic Media:
The company is spending a lot on electronic media. In their advertisement they
hirerenowned celebrities.
Advertisement:
The Lipton Yellow Label uses different types of advertisement as follows
Television:
Lipton yellow label spends a lot on television advertisment.Commercial during cable
network movies, TV shows such as special drama, news, talk shows and
SitcomProduct placement is also done in many of the shows.
Magazines:
Full page advertisment including Akhbar-e-Jahan, Mag, Family Magazine, Fashion &
BusinessMagazine.
Internet:
Lipton Yellow Label advertises on websites such as Facebook & Yahoo.
Co-Branding:
Avaiable at big shopping malls such as Dolmen Mall, Park Towers & Millenium Mall.

SWOT Analysis of Lipton

STRENGTHS
1. Unilever is a multinational company
2. Strong brand image, loyalty and brand awareness in Pakistan
3. Market leader as it has a 70% market share in branded tea.
4. Strong and long-term relationship with distributors, wholesalers and retailers.
5. Sound and experienced management and quality control staff
6. Strong Ethical value (culture and heritage)
7. Strong supply line and accessibility
8. Strong financial position
9. Quality, variety and success of the slogan
10.Effective & attractive packaging
11.Strong distribution structure
12.Highly innovative and effective marketing team
WEAKNESSES
1.
2.
3.
4.
5.

High prices of the product

Substitute products
Stiff/high competition
Large advertising budget
Low market share in Karachi, Multan and N.W.F.P.

OPPORTUNITIES
1.
2.
3.
4.
5.
6.
7.
8.

High rate of population growth

Market opportunity of Lipton Yellow Label in rural areas
Brand is the part if traditional drinking habits
Research & development
Makes people active
Expansion in other areas of country
Huge market to exploit
Strong brand loyalty

THREATS
1.
2.
3.
4.
5.

Strong competition in rural and urban areas

Internationally increasing tea prices and nationally consumption of open tea
Political conditions in the country may be obstacle to exports
High rising inflation in the country can negatively effect the brand
Tapals recent marketing campaign and possible increase of tapal tea market
shares.
6. Smuggling and increasing prices of raw material raise the prices of tea
products.
BCG Matrix of Lipton

The BCG Growth-Share Matrix is a portfolio planning modeldeveloped by

Bruce Henderson
of the Boston Consulting Group inthe early 1970's.
BCG Growth-Share Matrix
Question mark
Question mark is a stage in which company gets the high market growth rate of
there product butvery low relative share of market
Stars
Star is a stage in which company gets high market growth rate and high relative
share ofmarket. It is a stage in which company reach at its peak point.
Cash cows
Cash cows is a situation in which company gains high relative share (cash
generation) of their market but low market growth rate (cash usage).It is a stage in
which Lipton yellow label falls inthe current market situation.
Dogs
A dog is a condition in which the company has very low market growth rate and has
a lowrelative market share. In such condition the company may shut down their
work and exit themarket.

Porter five forces model analysis

1. Bargaining power of suppliers
The bargaining power of suppliers for Lipton tea is high in Pakistan because there is
an import of tealeaves from different countries like bangladesh, Sri Lanka, Kenya
and other countries.
2. Bargaining power of customer
If consumers are fewer the bargaining power of the consumers is high. If the
consumers are morethen the bargaining power of consumer is high. The bargaining
power of Liptons consumers is very high because there are many brands in the
market, Like Supreme, Tatly, and Tapal dander at lower price.
3. Competition among competitors/Rivalry
The competition of Lipton yellow label among competitor / rivalry is very high
because thelipton tea is an international brand and has a large investment in the
market. it has manycompetitor like tapal, supreme , tatly in the market . so they
face a huge completion in the teamarket in the market.

4. Threat of new entrance

Lipton yallow label is faceing very few threat of new entrance in the tea market of
Pakistan because of limited resoures and huge investment of capital is required to
enter in tea market of Pakistan. So new enterance of tea company in the current
market is har
5. Threat of substitute products
Lipton yellow label is facing very high threat of substitute product in the tea market
of Pakistan.It has also threat of technological changes of their competitor in his
product. For example tapalhas previously launched a new compaign

Feedback and control

Uniliver Company uses the different strategies to get marketcontrol such as;

Operating Control of Uniliver

Strategic Plans of Uniliver
market surveys
Market Audit of Uniliver

Recommendations
Lipton yellow label should reduce its prices in order to become a more
affordable brand.
Lipton yellow label should increase the use of tea vending machines to all the
major cities inPakistan.
Lipton should introduce its internationally recognized ice tea in Pakistan first
on an experimental basis and if this taste clicks with the consumers of
Pakistan Lipton stand to be the only tea brand providing the consumers with
this product.
Lipton should market its tea bags in small quantity boxes as it has done with
its lose tea.
Lipton s out of home department is one of its major strengths it should be
expanded

Conclusion
Lipton yellow label (UNILIVER) company has a strong image in theinternational
market due to large in size in term of financial and humanresources capital and
wider product range Lipton can look forward tocompetition in an encouraging and
growing market with increasingdemand expected to rise rapidly in the current
market status.