Promotions and IMC

Lipton Ice Tea and its product category is in its growth stage. Though, during the launch of the product in India they had used various promotion and advertising strategies to create consumer Media.

The below photo show the print ad used by lipton ice tea in the USA, which communicates the message that th e drink will brighten your day.

The photo below is where lipton ice tea is advertised Out of Home on highways on bridges with a creative placement in India.

Integrated Marketing Communication approach hasn't quite yet been adopted by Lipton maybe because of lack of competition. One factor that affects the advertising budget is the competition and clutter in the same category, which is why heavy spending is not required in their case.

Most of their communication strategy is spent towards persuasive advertising by positioning themselves as a healthy and refreshing drink mainly targeted at young population. Its persuasive for now because its still in the growth stage in its PLC.

When it comes to promotions, they have sampling promotions set up in malls and supermarkets for consumers to experience their product. For PR, very few articles have been secured by them, which can be inferred that they do not want to be dependent on PR. They would want to leverage their brand presence abroad just like Starbucks did recently.

They did have a national 'Get Refreshed Naturally' Campaign with a 360* marketing approach which included offline and online engagement with the youth. They also started a microsite which was integrated with social media like Facebook, twitter etc. The site also included a fairly simple advergame.

Another major campaign was the 'Chill Out Surprise' campaign, which mainly focused on twitter and was a huge success and this is what Ms Rashi Goel, the Brand Manager of Lipton Ice tea had to say about it,

”Lipton Ice Tea is a delicious beverage that gives instant refreshment so it helps people "Take a Chill Pill" in the middle of a busy day. The "chill out surprise" has been a very effective brand activation wherein we have surprised our consumers with moments of relaxation and refreshment in the middle of their normal working day! This brings alive the brand proposition and helps our consumers experience the brand promise first hand. It also goes to

demonstrate yet again how social media portals like Twitter (in this case) make it easy for brands to directly connect, interact and gratify their consumers".

Dsitribution

Distribution is the one of the 4 P’s of marketing and one of the most important. The purpose of distribution is to  make the product or service available to the consumers for consumption. It is not just a technical function but also is responsible for creating and delivering value to its customers, be it upwards or downwards.

My product Lipton Iced Tea is backed by the powerful arm of PepsiCo. PepsiCo already has a vast number of FMCGs under their belt for which there already exists a strong distribution network. Lipton Ice Tea leverages their distribution network to reach the masses across the nation.

Lipton Iced Tea’s target market is the masses which is why it uses an intensive distribution system. This helps in increasing their reach and coverage and also provides convenience to their customers.

PepsiCo has invested a lot in improving and innovating their distribution systems in-order to make them more effective and efficient. The distribution channels used by them are supermarkets/retail stores, restaurants, convenience stores/Kirana stores, Vending machines etc. PepsiCo has a strong and almost flawless sales and distribution network.





Even HUL, being a FMCG giant, has a strong distribution network. It has a network of 4000 redistribution stockists, covering 6.3 million retail outlets, which has a reach of the entire urban population and about 250 million rural population.

The Advertising campaign are also effectively carried out by PepsiCo & HUL.

Product Hierarchy

So today we had a somewhat brief discussion on Product Hierarchy, from which I understood that a Product hierarchy is a tool used by an organisation to classify, organise and understand various offerings and marketing those optimal set of Products.

The following are the six levels of product hierarchy using Lipton Iced Tea as an example,

Need Family- This is similar to the core benefit discussed in the previous post, which can also be related to Maslow's hierarchy of need. Ex- The requirement arising out of thirst and to quench it.

Product Family-These are supplementary attributes which can also be satisfied with the core benefit mentioned above. Ex-satisfaction received by the taste and the feeling of joy.

Product Class/Category- In case of Lipton, beverage would be the category under which various options would be available. These are usually generic items.

Product Line- So under beverages, there could be Tea, Coffee, Cold drinks etc.

Product Type- In each of the above examples, there are sub products like Green Tea, Iced Tea.

Items- Items contain store keeping units which are basically variants available under product types like different sizes or flavours available in Lipton Ices Tea.

Product Mix- Price

Imaging a world where everything is given for free, there would be chaos and anarchy.
The fundamental reason why we need a price a product lies in the core essence of Economics, 'limited resource and unlimited wants' !

In marketing terms, prices are important because it associates with not just the amount motivation but also the quality or the perception of quality of the product. Product mix pricing is when the marketers decide upon the price to enhance the overall profits of the entire product mix.

Product Line Pricing- Lipton Iced Tea is provided under different SKUs, that it , sizes, flavors.
These sizes and flavours are all priced at differently which target different types of consumers.

Websites like rediff are selling lipton ice to to consumers in mini bulks

http://shopping.rediff.com/product/lipton-ice-tea-lemon-flavour/10442053

The pricing objective of Lipton Ice tea is a mixture of survival, gaining maximum current profit & market share, and showcasing product quality to its consumers.

Its current price range is between Rs25 to Rs100, providing variants like 350ml bottle, powder pack, sampler pack and tetra pack.

Product Levels

Kotler in his book mentions the customer value hierarchy which addresses different levels of products offered by marketers to their customers. Product levels are important because understanding it helps marketers study the requirements of the consumer, and to strategies in order to increase their sales .

Product Levels for Lipton Ice Tea


Core Benefit- The requirement caused by Thirst

Basic Product- liquid in nature to address the thirst

Expected Product- A clean and healthy option(cool), with good quality.

Augmented Product- An Iced Tea concept which positions itself apart from other products addressing the similar requirement. Also providing options within the same category.

Potential Product-Lipton is always trying to add value to Tea and always manages to position themselves ahead of their competitors by coming up with new flavors and types of ice tea.


We can also link the Keniche Ohmae's model of 3C's (which Kotler fails to do), that is, Customers, Competitors and Company with the Product Levels in the following way,

Customer- Core Benefit, Expected Product.
Customers look to get their core requirements fulfilled, which is one of the main reason that customers buy products. They always look for faults and are not entirely satisfied which is why they always expect something more. 

Competitors- Basic Product, Augmented Product
Competitors need to have a basic product in place a as point of reference for the                  customers to buy. In the point of view of the company, competitors are always trying to                        better their product, which enforces the company to also come up with positive                                    changes to their products.

Company- Basic Product, Potential Product
 A company should always position itself ahead of its competitors by taking self initiatives                     in terms of innovation and bringing out new products in the market.                

Marketing Mix

Over the decades, the meaning of marketing has changed and evolved to include various processes which help in the success of the product.

In Marketing, this process includes four main elements, which are as follows-
1. Product
2.Price
3.Place &
4.Promotion.

Any product or service may use the four P's as their marketing strategy, and so does Lipton Ice Tea.

Lipton has quite a strong & aggressive marketing strategy, which is why it has managed to stay ahead of its competitors. It has positioned itself as a healthy & refreshing drink. But in-spite of its strategy, it continuous to face constant competition, which is why it has to keep maintaining its aggressive strategy. The following is a brief idea about their marketing strategy,

Product

Its main usp is that it has medical benefits and is the healthiest tea available in the market. This has helped lipton to stand apart from its competition.

Price

Lipton wants its ice tea to be a mass product and want to cater to the mass markets. Their products (tea bags & powdered sachets) are priced between Rs50 to Rs 100 which is as competitive as it can get. This has made Lipton Ice Tea an affordable product in the Indian Market.

Place

Lipton being an HUL brand in India, it has a well established distribution system in place which it can leverage to reach every possible store including groceries,supermarkets & megastores. It is easily available in the market.

Promotion

Lipton has used various mediums to promote its Ice Tea range, which include television & print, outdoor promotional activities (samples at stores etc.)

Life Cycle Concept

Life Cycle Concept

Just how humans are born, grow, mature and eventually pass away, similar is the story with products.

Products also follow the same life cycle as humans and is the called Product Life Cycle.

On similar lines, Industries also follow the same trend and is called the Industry Life Cycle.

So the above representation explains it all.

There are four basic stages that all products go through which are 

1. The Introductory Stage
2. The Growth Stage
3. The Maturity Stage &
4. The Decline Stage.

(though most models also have a research phase mentioned in the beginning)

From the Table above we can clearly infer that the Iced Tea in India is still in its Introductory stage because of the following,

1)High Cost, Less Sales

2)Less Brand awareness

3)Lot of advertising & promoting campaigns

4)Less competitors.

So it still has a long way to go in terms of the life cycle to reach the maturity level, it still has to develop and differentiate itself as a product in front the Indian customers. They will have to invest in increasing their distribution channels and also to create more awareness amongst Indians

Competition & Industry

Competition & Industry

Kal Ho Na Ho

Srk is all nice and all, the new entrant, tries to fit in the new neighborhood, woos PZ with his charm, but realizes that even SAK is interested in PZ, and instead helps him out to win over PZ, and eventually dies. 

 I know that this is a really (Really!) bad and failed example but what I wanted to convey was that Srk was the company, SAK was its competition and PZ was the customer both were vying for.

 In the business world as well there are competitors who are also trying to eat that giant market pie. And all those competitors put together become an industry.

The above gives you a brief idea of the bottled tea industry along with the competitors and few statistics. (in US).

India too have similar number of competitors like Tata Tea, Society Tea, Duncan’s Double Diamond Tea, Brooke Bond Red Label Tea, Taj Mahal Tea, Wagh Bakri Tea etc

The main competitors of Lipton Ice Tea is the collaboration between Coca Cola & Nestle named Nestea.

This Segment is still growing in the Indian Market, where the population still comprises of hot beverage drinkers. This is why it has a lot of growth opportunities, specially in a country like India.

Since it is a growing market, the players are putting in a lot of effort in advertising & promoting their product and also trying to create more awareness about this product.

The Ice tea Industry as a whole, has a bright future because of various reasons like growing tea segment, changing consumer preferences, changing lifestyles etc.