Sustainable Marketing

As the name suggests, NO!, it does not mean sustaining our marketing efforts. I had the same idea but the bubble burst when our guest faculty C.D Mitra, who has a keen knowledge on this topic explained to us that sustainable marketing is the ability of a company to adopt practices to contribute to make this world a better place to live  environmentally.

This concept is still in its infancy, as quite a few organizations have adopted sustainable practices. Its a difficult task to integrate environmental friendly products with profits. A lot of money is spent by huge firms in research to develop their products. Business cannot afford to spend so much, which is why it’ll take time for this concept to become more accessible.

Sustainable Marketing is not just focused on environment, but also on other aspects of a business.
Anything which can help a business to optimize its practices, building strong relationships with the customers, businesses or the society is also part of sustainable marketing.

Lipton Ice tea is known for its green practices. It uses sustainable farming practices, with all their tea estates. they are in process of sourcing all their tea from “Rainforest Alliance Certified” farms by 2015. Also, Lipton is taking up many CSR initiatives like, planting trees in Kenya under the ‘Trees 2000’ program.

Sales & Distribution Management

Sales, according to me is the most boring job in the world, it has no purpose in relation to life. Its completely a by product of the capitalistic world we live in. Having said that, as a system I find it truly fascinating because their main purpose is to convince people to buy their product or service.

The term sales management relates to the process of planning, directing & controlling selling activities which are conducted in a business.

There is common misconception that sales is a completely separate aspect of a business. Whereas in-fact, sales comes under the concept of Marketing.

Since Lipton is backed by two giants HUL & Pepsi, it has a group of talented individuals handling their sales management

The main sales & distribution objectives of HUL are as follows:

-To achieve their sales targets

-To make sure that effective & efficient dealers are chosen.

-Constant evaluation of their dealers.

-To maintain good relations with their distributors.

-To make sure the product reaches the consumers on time in all target locations.

-Use of appropriate promotion strategies to increase sales.

In HUL, there is no personal selling involved, products are wired through intermediaries and are sold to these intermediaries.

Analyzing Consumer Markets

The topic itself suggests the analyzing consumer markets. Its an important role that a Marketing Manager has to perform, especially in a country like India. India as compared to other countries is a lot more diverse and complicated. The consumers have over the years become more demanding and have become more picky when it comes to choosing a product. As I must have mentioned in my previous post that consumers are at the center of an organization’s existence. It vital to understand everything about a consumer’s behavior, because this understanding will eventually help in shaping our products according to their needs.

                                                                       

Consumers can be affected or influenced by various factors which broadly include  cultural, social & personal. India as said above, is a diverse nation with people following different religions cultures etc. Different classes or culture systems consume differently. For example, Brahmins ideally do not eat non-veg, so a product from Venky’s should never target Brahmins as it they not consume it and also it will hurt their sentiments.

Social factors explain how social roles in society affects our behavior, that is, our society can be divided into various groups like those who are experts in various fields or maybe it can be divided into primary and secondary groups based on our choice of reference.

Another factor is personal factors, which may perhaps be the most concentrated and important one. Personal lives play an important role in our daily decision making process. Events like marriages, promotions etc influence on our buying habits a lot.

The pioneer in understanding needs of consumers is afcourse the famous Mr. Maslow. Its one thing that every student whether it be science, commerce or arts knows about. Its very relevant, easy to understand, and has a well laid out structure. In the structure presented, Maslow has divided Human needs into 5 stages. I believe Lipton ice tea comes under the fourth stage, that is, Esteem needs.

Analyzing Business Markets

So Business Markets does not really come under the purview of my product because for lipton, its consumers who are their main source of revenue and not other businesses.

Business Markets behave and react differently as compared to consumer markets.

Business Markets	Consumer Markets
More rational in their buying behavior	More irrational in their buying behavior
Not the source of demand	The demand is derived from consumers
More systemized and organized	More unorganized as compared to Businesses but still has a structure
Personal Relations play in important role	Personal Relations are not required, just the mirage of personal interactions are needed.
Fewer sellers & buyers	More sellers and buyers

Branding

Branding is a term used to differentiate one’s product with another. It involves the process of creating a logo, packaging, designing, labeling etc. Its important to position one’s brand as superior to its competitors. It helps in creating a better image in the minds of the consumers. Consumers associate themselves very closely with the brand of their liking.

Therefore it becomes our duty as future Brand Managers to understand & maintain the values we want to communicate through our brands.

Lipton’s brand values are heavily dependent on its history. It has over 100 years of experience in tasting, buying & blending tea. They are experts in the Tea business. They are a hundred percent dedicated towards providing superior values to their customers by constantly improving their products through their research facilities and tea estates they have employed.

Keeping in mind that Lipton ice tea is handled by HUL in India, they have an additional backing when it comes to delivering their promises.

The brand has successfully established itself as the number one choice when it come to ice teas, mainly because of few competitors, but also because of the experience they have in this field.

Segmentation, Targeting and Positioning

Earlier, the world wasn’t very crowded nor complicated. The population was growing very slowly, overall progress of nations and kingdoms were slow as well. But things changed quite dramatically once the concept of capitalism was introduced. People started demanding more better products and more specialized ones. The behavior patterns changed of every individuals dividing them into sets of informal groups who do the same things, follow the same topics, and have similar hobbies etc.

Therefore a need came to focus products on these groups to gain maximum advantage and to earn maximum revenues. This is not to say that other groups are left out. Its just that while marketing a product, the marketer’s focus is only on the selected group or technically known as the Target Market.

Markets may be segmented into geographic, demographic, psychographic & behavioral segments. Basis of segmentation depends on the attributes of the product. For example, if its an ice cream, then it would probably work well in regions where temperatures are high. A very basic example, but the best one to explain.

Lipton Ice tea, have divided their Targets into two sets, one who are the consumers on the go, that is, students, professionals etc who lead a busy life. Two, who are more health conscious.

They have position the drink as a healthy alternative to other cold drink. Also that its tasty and refreshing. they have maintained this positioning in India ever since their arrival, whereas abroad they have changed it overtime.

Their main targets are people between the age of 18-30, who are mostly Millennial's.

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. 

Consumers & Consumption

The target group of Lipton ice tea are the “16-29 year old urban affluent healthy hedonists, young minded people, who enjoy life but also understand the importance of healthier choices”.

The need for a product arrives from a generic or basic need. A consumer may choose from various categories that may fulfill his/her requirement. For example water, beverage etc. The person will then choose his preferred category and will now start to evaluate various brands in that category. Once he is done evaluating various brands available, he will make a purchase decision based on factors like price, availability, value provided etc. After purchasing and consuming the product, he may buy the same product again or not based on his satisfaction from the product consumed.

In case of my product the process will go as follows:-
Problem Recognition----->   I am Thirsty ! My mouth is dry !

Information Search------->   How can I quench my thirst?. There are various options in front        
                                          of me like water, or perhaps a beverage, maybe something hot,
                                          or should I have something cold?!.

Evaluating Alternatives--->  Ok so Ive decided to have something cold and refreshing.Ive              
                                           got options like Lipton Ice Tea, Nestea, Coke, Pepsi etc. Let me
                                           find out their prices, availability, quantity etc.

Purchase Decision--------> So now that I have evaluated my options,Im going to purchase
                                          Lipton Ice Tea because it meets my requirements.

PostPurchase Behavior--> Am I satisfied with the taste, the quantity, the price of Lipton Ice 
                                           Tea? If Yes then great, let me go and get another one. If No, 
                                           then, Ill buy another brand or category to fulfill my thirst.

Its very important for an organization to understands various aspects of buying behavior of a customer. Its relevant because it helps the brand to strategize and take conscious decisions regarding increasing sales of its product and to provide maximum value to its customers.

Value

The second lecture of our marketing class was focused around a single word of VALUE.

So what is Value?

Before I ‘try’ to answer this Question, let me give you a brief idea about my product.

Lipton Ice Tea is made of tea leaves, real sugar with natural fruity flavors. It promises to refresh your body and soul naturally. Its healthy and a refreshing beverage.

Value is anything that is important, worth, or useful to something or someone.

To an organization, its customers are its value. The goal is to keep its customers happy at any cost. People associate different value with different images. It is highly important for an organization to create, deliver & retain value.

The following is the value proposition of Lipton Ice Tea:-

To a Customer-       Reputed Brand, Strong Heritage
To a Consumer-      Simple to use,Quality of the Drink and the satisfaction derived from it.
To a Retailer-          Good Packaging and Cheaper in Bulk.

Lipton Ice Tea is a part of the health & wellness portfolio of the Lipton brand.

It wasn’t an easy task for them to enter the Indian market. There were few basic questions that needed answering, for example, were Indians ready for such a beverage?. We perceive tea to be something hot. It had initially launched in 2004 but was ‘ahead of its time’. There was a gap between intent and action.

At a cost of Rs.85 for a 250g powder pack, Rs.75 for a tetrapak, and Rs15 for a sampler pack, Lipton Ice Tea was providing good value to its customers in terms of price.

The Customers of this brand are satisfied and content the quality and quantity it provides.

Lipton Ice Tea

-Get Ready to Taste the Sun
                       Taste the Fruit
                       Taste the Bright side

  I remember when i was around 7 years old, my elder sister had joined an informal drawing classes, most of which happened in our house. Students used to come to our home and learn various drawing skills from a teacher named Mrs. Seema. This was the year when the world was waiting for the consequences of the y2k bug.

 Mrs. Seema, back then, introduced me and a few others to a product named Lipton Ice Tea. Every class she used to get everyone a can of that drink. That drink fascinated me, it was something different, it felt good and refreshing. I really started to enjoy those drawing sessions.

Fast forward 15 years, and I have now joined SIMC’s MBA course.
My Marketing Management Professor Mr. Chandan Chatterjee, gave us an interesting assignment to write a Marketing Diary on a product of our choice. For some reason I was having a hard time choosing my product. One day, me and a few friends were sipping on some ice tea bought from the local store. Turns out that the answer was right in front of me .

LIPTON ICE TEA. PERFECT !

So now that I found my product, what next?.
I have to relate whatever has been taught in class with my product.

In our very first lecture, we discussed the fundamental question. What is Marketing?
Its all about creating, generating & maintaining demand for a product. Its is very important to maintain the Brand value of the product and the organization throughout. And I believe Lipton has been very successful in achieving the above.

Lipton is a brand of tea which was introduced in 1890, named after its founder Thomas lipton. It has a strong legacy and a worldwide presence.

Lipton has leveraged its brand image to launch various products including Lipton Ice Tea.

Coming back to the basic question, has Lipton Ice Tea managed to create, generate and maintain demand?, an absolute Yes. Me along with millions of others are a living proof of that!