Ice Tea Lipton Australian Market - Case Study Example

Ice Tea Lipton” Australian market. Name Course Instructor Date “Ice Tea Lipton” Australian market. A. The marketing mix. A.1. The Australian target market. The tea industry has definitely grown over the years and it is expected that it will grow even further in the years to come (Mintel 2005). There have even been calls by several marketing analysts who believe that the tea industry is yet to reach its saturation level, at least not in the near future. The position that tea enjoys which is favourable to its success is attributed to the good press that it has been receiving on its benefits and the need by consumers for convenience as well as practices that save time (Sturdivant 1992). The major target markets for the ice tea that is ready to drink being offered under the brand name Lipton include the consumers who are ever on the move or on the go and the consumers who are conscious about their health. The people who fall in the first group include students and employees whose lifestyles are ever busy thus the need to provide a product that is accessible easily and readily to match their lifestyles that require optimization of productivity while ensuring that the least time is consumed. The other target group which is the health conscious consumers are targeted owing to the fact that they advocate for anything healthy and thus they can be targeted owing to the positive review that tea has been receiving. 1.1 The product: The core product that is offered by Lipton ice tea is convenience in terns of the readiness of the product to be consumed by the consumers directly. This convenience is also presented by the act that the product is readily available in most shops and supermarkets. Another benefit of Lipton ice tea is its nutritional value that it provides to the consumers. The actual product is the Lipton ice tea itself while the augmented product is the satisfaction that is derived from the use or intake of the product. The packaging of Lipton offers protection and preservation, containment of the contents while at the same time offers communication t the consumers on the nutrition value and other information that is needed and printed on the package. The package thus tends to offer differentiation from other similar products owing to this communication (Mintel 2005). The product is in the maturity stage as it has competitors offering similar products. The distribution of the product is more is more extensive, the promotion is mostly emphasized on differentiation and the pricing strategies of the product is aimed at being lower owing to the growing competition (Mintel 2005). 1.2 Promotion: The promotion of the product is very important for its success within the market, and thus, the reason behind the much publicity that Lipton ice tea is being given within the Australian media. The product has been promoted by the use of certain programmes and magazines which are exclusive to Australia. Examples of programmes include; Support Your Local Gunfighter, Doctor Who, Lost Worlds and The 13 Roses. The product has also enjoyed publicity from the print media for instance being advertised and promoted in magazines such as; Australian Traveller, Prevention, The Economist, Quilters Companion and MiNDFOOD. These forms of media re used in the promotion of the product as they are widely used by the target market that the products company is aiming at reaching, and it has proved to be effective. The firm has taken up the use of both direct and online communications to aid in the sale and the provision of information as well with regards to their product (Mintel 2005). Direct communications has been taken up by agents who set up stands in malls and other publicly accessible areas, and offer free samples so that the public can have a taste of the product for free before actually buying it. Online communications have also been used to educate the public on the importance of the product in terms of health benefits, the price of the product will also be put across in these promotions as well as places where the product can be purchased and finally and also convenience of the product itself. The promotion is mostly emphasized on differentiation and the pricing strategies of the product is aimed at being lower owing to the growing competition thus putting it in the maturity stage of the product life cycle. 1.3 Place: The company has been aiming to ensure that they capture the booming business of ready to drink tea and thus an agreement was made between the Anglo Dutch company and American Pepsi Company in the year 2003. The joint venture has enabled the distribution and marketing of the Lipton products by Pepsi in more than 60 countries, especially the countries in which the company is enjoying a major and influential status (Sturdivant 1992). Aggressive marketing strategy that the firm has taken has been useful more so by taking advantage of the positive press that tea has had, and this has aided in boosting of sales of the product. The company uses the studies on the benefits of their product to the health of its consumers and uses this to promote their product. Another distribution strategy that the firm has chosen is the use of improved shelf presence, which involves the making of a deal with retailers to ensure that the product enjoys prominent positioning within their stores. Shelf space has been important in the promotion of many different products and it can be the factor that determines the making or the breaking of the success of the introduction of a new product (Sturdivant 1992). This distribution is appropriate for the product life cycle stage of maturity, as it gives the product a competitive edge above its other competitors when it comes to positioning of the product within the stores. 1.4 Price: (in Australia) The lepton ice tea is soled with two types of bottles, a 500 ml bottles and 1.5 litres bottles. The 500 ml bottle is sold with $ 2.29, and the price of the 1.5 litres is $ 3.46. However, this price is determined by the Lipton Company, but it may change in different markets or shops. These changes are depending on many factors. One of these factors is the geographic factors, which means that some shops in specific location sell Lipton Ice Tea with different values. In Woolworth for example, the 1.5 Lipton ice tea is sold with $ 3.29 which is $ 0.17 less than the basic price. It is clear that the price of the 1.5 Lipton Ice Tea is more economical than the 500ml. this is measured by the cost for every litre. For instance, the 500ml is cost around $ 4.58 per litre, while the cost of 1.5 litres is sold with the value of $ 1.12 per litre only. The consumers who may consider the economical value would likely to buy the 1.5 litres bottles. Some consumers may buy ice tea for limited consumption such as thirsty or while they are driving. Therefore, they may choose to buy the 500 ml. In addition, the strategies that Lipton used to price the Lipton ice tea is called the product-line pricing. This means that Lipton set a price for group of products not for individuals’ products. It set the same price for all products of ice tea which has the same size of bottles. For example, when it priced the 500ml bottle, it used the same price for all 500 ml bottle products. There is another ice tea producer company. This company is called Nestea. In reality, the prices of Lipton Ice Tea are quite cheaper than Nestea products. For instance, the 500 ml bottle of Nestea is cost around $ 2.33, which is $ 0.04 higher than the Lipton Ice Tea 500 ml bottle. Also, the economical bottle of Nestea is 1 litre that is cost around $ 3.25, whereas the cost per litre of the 1.5 litres Lipton Ice Tea is cost around $ 2.13. This means that it is $ 1.12 less than Nestea’s 1 litre bottles. B. The interrelationships between the 4 Ps. The firm has ensured that all the 4 Ps are interrelated with one another, and this could be used to the advantage of the product and its promotion within the Australian market. The product has been linked to the promotion of itself through the use of different media and communication methods and this is also linked to eth price of eth product as in the communication, the price and the place that it can be found is also included, and thus giving that link. The promotion of the product also links the product to the price and the place while the price of the product will link the product to the promotion strategies to be used. The place that the product will be located will link it to the promotional strategies that are bound to be used to ensure that the target market is reached and that the product lives up to the standard of being in the maturity stage. C. Competitive Advantage. The aggressive marketing strategy that is being used by the firm to market its product makes it more appealing to the target market and also gives them that competitive edge above their competition. The improvements that have been made in the packaging of the product especially the 16-oz and 2 litre bottle have ensured that the consumer has a variety of choices and also improve its availability to the consumers, and thus making it stand out from the competition. The firm has to ensure that it continues with much research and development of the product to ensure that the quality of the product improves even more and also to ensure that new flavours are developed. The firm will only be successful in marketing this product if it offers the consumer a ‘better’ marketing mix. The consumer decides whether the offer is better than the competitors’ offers. The improved packaging is what will make the target market view Lipton ice tea as better than the other alternatives within the market and this is the competitive advantage that the product will enjoy. The pricing of the product is also very important and the prices should be set in a range that the target market can afford while at the same time ensuring that it does not affect the profit that the company aims to achieve. Affordable prices will also ensure consumer loyalty to the product. D. Your assessment of the firm’s success. The firm has been successful in the development of a competitively differentiated marketing strategy based on the fact that the strategies that they have used have a proven track record. The aggressive marketing strategy that is being used by the firm to market its product makes it more appealing to the target market and also gives them that competitive edge above their competition. The packaging of the product has also ensured that the firm has developed a differentiated marketing mix from other similar products within the market and thus targeting the consumers. This is seen in the manner in which the firm has packaged the product in many different sizes, enabling even the low earning consumer the ability to buy the product (Sturdivant 1992). The pricing of the product is also advantageous to the firm in marketing their product as it enables them to reach their target market more so the middle and low income earners thus the overall marketing strategy and the market mix for Lipton ice tea has generally been a success. Bibliography Mintel. 2005. “Tea and RTD Tea in Australia.” Available from http://www.liptont.com/our_products/iced_tea/ Sturdivant, S. 1992. “Ready to drink teas and new alliances: the race is on for market share.” Tea & Coffee Trade Journal , October 1992. Available from http://www.allbusiness.com/manufacturing/food-manufacturing-food-coffee-tea/323313-2.html. “Unilever, PepsiCo join forces to meet ice tea challenge.” Available from http://www.foodanddrinkeurope.com/news/ng.asp?id=18257-unilever-pepsico-join Lipton Linea website http://www.liptonlinea.com/ Read More