Marketing Research on Tea Industry in India

MARKET RESEARCH ON MAJOR TEA BRANDS IN INDIA Siddhartha Lodha PG-A History of Packed Tea in India The history of tea dates back to 750-500 BC. Researchers have found that the cultivation and consumption of tea has been taking place since more than a thousand years. However, commercial consumption of tea started with the British rule. It has now become a part of the Indian culture. Tea laid it’s foundation in India at the turn of the 20th century, when the major emphasis was on the exports of Tea.Earliest reference to a domestic market came from MacKay of Brooke Bond. Equipped with capital and premises, Mackay settled down to serious business. Mackay clearly identified his objectives as to pick up teas suitable for Brooke Bond blends at home, rather than getting them at London and to create and make profitable, a packet and blended tea trade in India and generally in the East. In the early 20th Century, much of India was orthodox and all foreign habits were considered alien and against Indian ethos and culture.In fact, later, when tea was officially promoted by the Tea Market Expansion Board, strong religious pressure groups launched antitea campaigns against tea drinking. The domestic market was very small and hardly able to sustain. Packing material, mainly caddies and cardboard cartons, were imported the UK and the tea was floor-blended and hand-packed. Sales totalled around 17,000 lbs. and the whole operation produced a loss without inclusion of overheads and other costs.It therefore needed a great commitment to persevere this kind of a venture. Backed by the promotion and propaganda efforts of the Tea Market Expansion Board that became the Indian Tea Board through the pioneering efforts of Brooke Bond (more about this later), a strong demand was created for tea as a beverage and the Indian masses avidly took to tea. However, much of the fallout of this phenomenon went to loose teas because of the price factor, so we see a strange development in the p acket teas trade in India.In the early years, i. e. the first three decades of the century, the trade was predominantly in the hands of foreign companies and the incipient demand was centered on a small segment, introduced to tea through the Western industrial civilization. The early brand names were based on colors — Red label, Violet label, Green label. The first sale record in India was in April 1903 and the entry reads: Red Label †¦ 720 lbs. Violet Label †¦ 300 lbs. Green Label †¦180 lbs. The fact that Brooke Bond Red Label recorded 720 lbs. as a very auspicious augury for this famous brand, which attained dizzy heights in later years to become the largest selling brand in the world. The early entrepreneurs of packet tea marketing realised that if the trade had to expand, the purchase price of the tea had to be more affordable for their Indian consumer and the tea had to be better presented. In India however, the main consideration was price, one that the l ower economic section of the Indians could afford.When the brands were first launched in the first decade of the century, the cost of the tea in the packet was roughly 60% of the total price. Despite this, prices were considered high. But the demand had been created and was snowballing — opening the floodgates to loose teas, which were at least 20% cheaper than the corresponding tea in packets. Opinions on the worth and prospects of the internal business seemed gloomy. One opinion was that â€Å"Indians can never become tea-minded†.This was based on the English custom of brewing tea in pots, using a long leaf — a leisurely and luxurious habit. It is interesting to note that very early in the century, the marketers of packet tea recognised that if tea had to be made popular among Indians, it had to be presented differently, keeping in mind the Indian cooking habit of boiling. So dust tea was born. ‘Kora’ was the first brand to be introduced by Brooke Bond in paper form packets. The real expansion of the packet business in India came in the early l920s, with the introduction of the direct selling system by Brooke Bond.As was said earlier, the distribution was left in the hands of distributors and stockists who could do a maintenance job but could not do anything to create demand. The depot system or direct selling system helped in introducing tea to the vast population of India but it meant a heavy investment in marketing in the earlier years. It helped in establishing a two-way communication between the salesman and retailer and cemented a personal relationship between them. For a product like tea, where freshness was an important factor, it helped in ensuring stock rotation.Under this system, the companies like Brooke Bond and Lipton, who followed suit through their own personnel, called on all retail outlets on a regular basis and supplied tea on a cash-on-delivery basis. There was no need for the retailer to carry any large inventory, as the calls were on a weekly basis. The system backed by the effective propaganda by the Tea Board really sparked off a consumption explosion, taking India to the position of the largest tea-drinking nation in the world. Today tea has become established as a food habit in all socio-economic sections.In India, tea is an essential item of domestic consumption and is the mostly consumed beverage. Further, tea is the cheapest beverage amongst all the beverages that are available in India and it is very popular amongst all sections of India society. The Indian tea industry engages around 20 lakh of workers, directly and they mainly represents the under privileged sections of the India society. The Tea Business in India registered a total turnover of Rs. 10,000 crore in the previous year. Top Tea Brands in IndiaBrooke Bond has touched millions of consumers with a range of tea offerings appealing to the diversity of their tastes. It has the strongest foothold amongst any of the tea brands in India and touches the homes of over 500 million consumers. The values and personality of the master brand Brooke Bond reflect a warm, sociable, approachable, perceptive and dependable entity. Brooke Bond is the tea expert that selects the best at every stage – from the garden to the cup. The brand, therefore, is seen to offer the appropriate teas for all tea moments in the consumers' lives.Brooke Bond offers a strong portfolio of four sub-brands namely, Brooke Bond Taj Mahal, Brooke Bond Red Label, Brooke Bond Taaza & Brooke Bond 3 Roses. The range offers a full variety of benefits as well as price points to cater to diverse sections of society. For over 4 decades, Taj Mahal has been the gold standard of tea in India. It has been a pioneer of innovations in the Indian tea market First Premium Tea Brand First to introduce tea bags First to usher in new formats and concept, like instant tea – Dessert Tea Brand ambassadors personify the true essence of Taj Mahal (Ustaad Zakir Hussain, Saif Ali Khan)Red Label contains natural flavonoids that helps improve blood circulation and keeps you healthy. Red Label Natural Care has a mix of 5 Ayurvedic ingredients like Tulsi, Ashwagandha, Mulethi, Ginger and Cardamom. Red Label Dust has strength, taste and comes with the Red Label promise of great quality. Red Label Special has extra-long leaves to give you great taste, colour and superior aroma. Entered the lives of the contemporary Indian housewife in the 1990s. Unique and refreshing blend of tea that's sprinkled with fresh green tea leaves.It's her daily cup of joy that helps her to refresh and connect with her inner self and aspirations. The advertising communication for Taaza is a reflection of this relationship. Chronicle of the aspirations of a housewife over the past two decades. 4th largest tea brand in India with a portfolio spanning in both leaf and dust segments. 3 Roses which was synonymous to the trinity of perfect colour, perfect strength and perfect taste 3 Roses stood as the bedrock for strengthening a married couple's relationship with each other 3 Roses has redefined the nature of relationship shared between married couples in IndiaBrooke Bond Sehatmand (Arogya) was launched in early 2010. Brooke Bond Sehatmand with Vitamin Power, helps to keep families healthier through their favourite daily beverage 3 cups of Brooke Bond Sehatmand helps to satisfy 50% of the Recommended Dietary Allowance (RDA) of Vitamins B2, B6, B9 and B12 Brooke Bond Sehatmand successfully runs the ‘Sehatmand Parivaar, Sehatmand Bharat’ movement – an initiative to reach and make a difference to 500 million families across villages in India through education on health and nutrition. nd most trusted beverage brand in India Market leader measured by volume and value branded packet tea Has transformed the way beverages are marketed by positioning tea as a catalyst for social change Promotes social awakening and action through its landmark ‘Jaago Re' marketing campaigns References: 1. History of Packet Tea : http://www. contemporarybrokers. com/item. aspx? id=100 2. Brooke Bond Brands : http://www. brookebondhealth. com/our-brands. asp 3.