MARK5800 Group Report

MARK5800 - Group Assessment

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MARK 5800 Customer and Market Analysis Group Assessment

By:

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Junhao Chen (Cornelious)

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Jianpeng Hu (Terrence)

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Tian Liang (Thomas)

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Carly Davis


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Table of Contents

Introduction

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Consumer Behaviour Audit History of Lipton and tea drinking in Australia

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The Worldwide Market

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The Australian Market

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Product

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Product Positioning Pricing

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Distribution and Promotional Strategy

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Discussion Points - Generations Demographics: The Older Generation (1900-1930s)

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Demographics: Baby Boomers and Generation X

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Demographics: Generation Y and Z

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Conclusion

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Reference List

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Appendices Appendix A – Market Share for the Major Tea Brands in Australia

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Appendix B - Lipton Hot Tea Product List

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Appendix C - Lipton Hot Tea Product List

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Introduction Consumer behaviour is one of the more fickle components of marketing. It is unpredictable, dynamic and easily influenced by factors beyond the control of the marketer. The challenges faced by marketers today in this ever-changing landscape are unique and diverse and must be met with a comprehensive business strategy complemented by an integrated marketing plan in order to achieve success.

Unilever is the producer of household products ranging from soap to tomato sauce to tea and it is estimated that a Unilever product can be found in over two billions households worldwide on any given day (G Neath 2012, pers. Comm., 25 Jan.). A brand name synonymous with globalisation and consumer goods, Unilever leverages its market power and presence to further enhance its brands in the mind of the consumer. The traditional marketing model focuses on the strategies used by markets to alter their product‟s attributes such as price or packaging in response to circumstances within the marketplace; however, it should focus on both the consumption patterns of the consumer and the macro environment in which it occurs in (Patel & Schlijper 2004). This body of work will endeavour to analyse the marketing situation of a product, in this case, Unilever‟s brand of Lipton and its te a, and how its marketers use this analysis to guide the development of the marketing strategy. It will also discuss how Australian society, in particular demographics and lifestyle, as well as household structure influences the consumer‟s behaviour when pu rchasing Lipton tea.

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Consumer Behaviour Audit

History of Lipton and tea drinking in Australia Lipton was originally founded by Sir Thomas Lipton in Scotland, 1893. After over 100 years of development, it became one of the most famous leaf tea and ready-to-drink product suppliers in the worldwide market. Lipton ‟s products such as “Lipton Quality Black Tea”, “Lipton Green Tea ” and “Lipton Ice Tea ” were distributed into Australia decades ago. Lipton has dominated Australian tea market for many years because they never compromise on their product quality and their marketing strategies are farreaching and effective. The Lipton tea business was acquired by multinational corporation Unilever in a number of separate business ventures over the space of four decades, beginning with the purchase of the US and Canadian branches in 1938 and completed in 1972 when Unilever bought the remainder of the global Lipton business (Unilever, 2011). Traditionally, hundreds of years ago, tea production and consumption was confined to the likes of South East Asian countries until European traders changed this and introduced it to other parts of the globe (Grigg 2002). Religious influences once played a role in its popularity, albeit none today, and the British shared their fondness for the beverage by taking it with them when establishing new colonies (Grigg 2002). Major organisations that produce and supply tea have seen a slight downturn in sales of tea in developed markets, however, are counteracting this by investing in emerging markets and developing or extending their product range (Euromonitor, 2012). According to Euromonitor (2012) Unilever‟s Lipton tea accounts for five per cent of the groups total Fast Moving Consumer Goods (FMCG) retail value sales, growing approximately ten per cent in 2010. Of their hot drinks sector, tea is accountable for over three quarters (79 per cent) and is the key force in driving the growth of the hot drinks sector (Euromonitor, 2012). In 2008, the Australian tea category was valued at A$437 million and by 2013 is anticipated to grow by nearly 10 per cent to reach a value of A$473 million (Datamonitor, 2012). Currently, tea sales in Australia are driven by the „at -home segment‟, with the Lipton brand from Unilever, followed by Dilmah and Tetley, being the favourite tea brands amongst Australians. According to the Lipton website, Australian and New Zealanders drink approximately 16 million cups of tea a day! (Unilever, 2011). Recent trends in healthy living and the discovery of medicinal benefits has resulted in the fruit/herbal tea segment leading the growth in the tea market with around 5 per cent growth over the past decade (Wong, 2010).

The Worldwide Market The consumption of tea does not discriminate between race, socio economic status, gender or culture. It is appropriate for consumption by both males and females,

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though studies have shown that females possess a high propensity to purchase and consume tea compared to their male counterparts (Luciano et al. 2005). Previous studies by Hettema et al (1999) and Kendler & Prescott (1999) demonstrate that while environment influences play a considerable factor in the tea consumption patterns of the end-user, they are also influenced heavily by the genetic disposition of the individual. Additionally, exposure to tea drinking reference groups amongst peers, the workplace and through the family environment will impact the consumption of the product (Luciano et al. 2005). Over time, increasing amounts of people are realising that tea contains hundreds of beneficial chemicals and provides numerous of health benefits, and has even been linked to prevention/reducing the risk of cancer (Fujiki et al, 2002). Subsequently, the amount of tea consumption has increased dramatically. In 2004, the United Nations and Agriculture Organisation presented research that showed the worldwide production and consumption of tea has reached over 3.2 million tonnes (Zencha 2007). The Australian Market The tea industry in Australia is typified by great diversity in product width and depth; refer Appendix A for a listing of Lipton‟s competitors. The Australia tea industry and has remained resilient despite economic down turns, the precarious nature of the resources that supply it, changing trading conditions, declining consumer confidence and strong competition from other hot beverages (IBIS World, 2012). Even though the current average tea consumption in Australia has declined since the emergence of the café coffee culture, the Australian market of tea consumers still generates profit to tea suppliers. According to Zencha (2007) in 1970, when the coffee culture was not as prevalent as it is now, every Australian consumed nearly five times the average today, 3.8 kilogram of tea per year. Despite the dramatic attraction of coffee nowadays, according to the Australian Food and Grocery Council (AFGC) Tea Industry Forum, the current tea market in Australia is large as well. In 2003, the total value created by Australian tea market was A$264.4 million (The AFGC, 2003). This number increased to A$290 million in 2010 (Lee, 2010) and is anticipated to rise to A$473 in 2013. Lipton owns the biggest part of the market share in Australia. According to Zencha (2007) and The AFGC Tea Industry Forum (2003), Lipton has beaten its leading competitors Twinings and Dilmah, owning 21.6 percent of the total market share in Australia in 2003. The top second brand Twinings has 17.8 percent and the third Dilmah has only 12.8 percent of the total market shares, refer to Appendix A for more detail. Furthermore, the market popularity of Lipton tea is continuing to grow. According to Lee (2010), Lipton has successfully increased its market share to 26 percent in 2010. Lipton‟s market segmentation for tea is wide reaching, however is predo minantly targeted at the „at-home segment‟, the key target market being 35 years of age or

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older who know and love Lipton and have been drinking it for years (Constantaoulas, 2004). The flipside to this „at -home segment‟ is the „dining-out segment‟ – those consumers who order tea as a takeaway beverage or sit down in an environment other than their home to consume the product that was purchased individually. Essentially, tea is either a hot or cold beverage consumed to satisfy thirst, encourage health benefits and refresh, and according to the Lipton website, is the second most popular drink in the world after water (Unilever, 2011). Compared to its competitors such as T2, Lipton is easily accessible to its target market, in particular people with relatively low incomes. Take a walk through your local grocery store and you will see a box of 25 bags of Lipton tea for example, costs about $4, whereas a box of tea bags at T2 would be in excess of $12. Not much of a difference, however, for a household or consumer on a low income, the $12 box may seem an outrageous price to pay for a box of teabags. Product The Lipton product is designed to appeal to the mass market at home tea drinkers. It is at a reasonable price point, competitive with that of its competitors in Tetley, Dilmah and Bushells, but at a higher price point than home brand variations. It doesn‟t try to be top of the range or appeal to tea connoisseurs like that of T2. It appeals to plain tea drinkers (black), health conscious drinkers (green tea) and those wanting something a bit different but in the same vicinity as tea (chai or herbal infusions). Observations show the product packaged in bright yellow cardboard with the distinctive red Lipton logo, easily recognisable and due to product positioning on the shelf, within the purchasers‟ direct line of sight. Lipton generally provides two essential series of tea products in the Australian market. These are “Lipton Hot Tea ” and “Lipton Ice Tea ”. “Lipton Hot Tea ” is mostly tealeaves packed in small bags and sold by the box. “Lipton Ice Tea ”, on the other hand, is sealed in bottles and ready-to-drink. Appendix C demonstrates the categories of product in both the Lipton Hot Tea series and the Lipton Ice Tea series. Recently, in response to the increasing demand of healthy soft drinks, Lipton has launched two light soft drinks that contain virtually no sugar, no preservatives or artificial colours – the “Lipton Light Ice Tea ” series, refer to Appendix B for details. Product Positioning In order to attract new customers and retain existing ones, it is vital that Lipton ‟s products are able to provide a positive, general and semantic memory structure regarding to each market segment (Quester, Pettigrew and Hawkins, 2011). By communicating product attributes, Lipton ‟s products will have a greater chance to meet its customers‟ ideal version of production. For example, as Unilever (2007) describes, Lipton ice tea is “the perfect drink for active, healthy lifestyle”. It is an active and engaging market positioning slogan as an active and healthy lifestyle is certainly an aspirational goal for many people. While the target market may have entirely different definitions of what their active and healthy

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lifestyle comprise, it must be something positive that is refreshing, enjoying, exciting, active, and reach the goal the consumer set out to achieve. In fact, besides the Lipton ice tea, most of Lipton ‟s products were advertised by a similar market position image that is healthy, high quality, great taste, has multiple flavours and refreshing. Pricing The decision to purchase tea is a low involvement decision driven by a need to consume a hot tea beverage. The consumption of the product may not occur immediately and sometimes the purchaser may not be the end user. Internal influences such as emotions, needs or desires play a limited role in the decision making process of the individual when purchasing tea as it is a low involvement purchase that is minor in the scheme of things, involves an internal to limited external search, few alternatives are evaluated and the performance of the product is simple and straightforward (Neal, Quester and Hawkins, 2004). However, marketers must be conscious that the purchase of Lipton occurs because of loyalty and not as a purchase out of habit. Price is another major factor that affects the consuming decision of consumers. Selling products at a reasonable price where the consumer feels they have achieved value for money is a key contributor to marketing success. Distribution and Promotional Strategy Lipton tea is sourced from company owned plantations, or tea estates, in the East African nations of Kenya and Tanzania as well as from up to as many as 35 other countries (Rainforest Alliance, 2007). Having a number of suppliers and resource bases situated at various locations around the world not only diversifies risk, but also reduces the likelihood of negative impacts on the supply of the product and Lipton‟s brand should an unforeseen instance damage one resource base or suppliers ability to supply. Lipton‟s distribution strategy is to place their products in highly visible, prolific supermarket chains in Australia, e.g. Coles, Woolworths, IGA etc, as well as petrol station chains and corner stores. Lipton‟s distribution system can capitalise on reference groups by serving as a meeting place for individuals with common interests. For example, visit a number of cafes in many cafes and restaurants in Australia and you will see they stock Lipton tea and offer it on their menu, meaning that Lipton have widened their distribution reach and diversified risk by selling their product via both retail and wholesale. For example, a downturn in the dining out/hot beverage segment may impact their wholesale trade however will h ave limited impact on the „at-home segment‟ as Unilever estimates that only one out of eight purchases are actually purchased by the „dining out segment‟ (Unilever, 2011).

Lipton undertake a comprehensive integrated marketing campaign, using mass media such as television and print to promote their product but have also delved into social media vehicles such as facebook to promote their products, with their longterm strategic aim being to remain the driving force behind and market leader in the tea category (Constantoulas, 2004). Mainstream marketing tools such as advertising through mediums such as television, radio and print are used. Various promotional

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tools and activities have been implemented such as promotional giveaways, price promotions, point of sale advertising, education about tea and its health benefits via their website and events sponsorship. This integrated marketing approach means that Lipton reaches their target markets through a variety of mediums, communicating their message that Lipton tea is a quality product and the coveys the message that most people are not interested in things like terminology, they just want to enjoy a good, refreshing cup of tea, which is what Lipton offers. Discussion Marketing has long relied on segmenting the market, often using birth ages to create and target groups, however, while it does describe and group market segments it does not help to understand the motivations of the consumers within this segment (Schewe & Meredith, 2006). Schewe and Meredith (2006) also argue that environmental events experienced during a consumer‟s earlier years, however, create values that remain relatively unchanged throughout their life. Such values are heavily influenced by external influences such as the society, including demographics, values, gender roles within the household structure, subcultures and lifestyle (Neal, Quester and Hawkins 2004). Lipton‟s marketing team need to d evelop marketing strategies that appeal to the various consumer groups it identifies while considering key external influences such as those mentioned above.

Demographics: The Older Generation (1900 – 1940‟s) The mature market consists of those born before World War 2 (1939) ranging from 75 to 85 years of age plus in 2012. This mature market exists because of an age difference and the creation of an ageing population due to greater life expectancies, medical advancements and generally higher standards of living (Neal, Quester and Hawkins 2004). The mature market is increasing both in total volume and in proportion to the population size. For example, at the end of the 19 th century the mature market comprised 12 per cent of the total adult population in Australia. In 2051, with current growth rates, the mature market is anticipated to represent almost one quarter (24 per cent) of the Australian population (Australian Bureau of Statistics 1999). When drinking tea, its country of origin, Britain, would have been a considerable influence on the tea drinking patterns of the mature market. The British shared their fondness for the beverage by taking it with them when establishing new colonies (Grigg 2002). This older generation are likely to still be heavily influenced by this trend and it can be argued that unlike now where there are numerous hot beverages available on the market, choice was limited. Subsequently it was the beverage of choice, due to not only country of origin influences but also limited alternatives. This creates many challenges for marketers, as they must recognise that the needs of this consumer group differ from other age subcultures such as Baby Boomers and Generation X, Y and Z, and are in no way homogenous in their desires of expectations of the product and organisation. Neal, Quester and Hawkins (2004) argue that rather than use age as a determinant; consumption behaviours would be

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better suited. Moschis et al., (1997) support this argument and recommend grouping customers together based on similarity of their responses to marketing factors in order to achieve greater marketing efficiencies and customer satisfaction and commitment. People respond differently to marketing stimuli based on their needs and wants, past experiences, current stage in life and other external influences, therefore it is highly unlikely to be able to develop marketing strategies that would be effective for all of the mature market (Moschis 1992). The mature market is retired with therefore more discretionary time and income. They are only average television viewers (despite their free time) however have an active interest in politics, current affairs and documentaries and are above average newspaper readers as well as radio listeners and talk back radio participants (Neal, Quester and Hawkins 2004). This means that media habits of the mature consumer are important to Lipton and need to be identified so they can use the appropriate mediums to reach this consumer. Lipton should be utilising advertising space in print mediums such as newspapers and magazines, as well as focusing on television campaigns. As with any market, as the mature market ages so do their needs and wants. There is an increasing focus by this consumer group on healthy lifestyle choices and antiageing products; therefore Lipton should promote product attributes such as the health benefits of tea and how the product easily fits into a healthy and active lifestyle. Considering this mature consumer group has an active interest in current affairs and politics it may be advantageous for Lipton to also spruik their commitment to producing and supplying tea sustainably by being a fully certified Rainforest Alliance tea producer and supplier (Rainforest Alliance, 2007). Demographics: Baby Boomers and Generation X Baby Boomers were born in the years post World War 2, between 1946-1964, and are in age range of 48-66 in 2012. These consumers are characterised by tendancies to focus on health and wellbeing, and are reserved with their spending, creating a significant wealth base behind them (Williams and Robert, 2010). They have either reached retirement age or are nearing it, therefore have greater discretionary income and time after their retirement. This generation is said to be more sensible than other generations as they were heavily influenced by their parents who experienced tight living and ration like existences during the War, and instead of wealth and accomplishment, quality of living and entertainment are the major goals for Baby Boomers. (Williams and Robert, 2010). When marketing to the baby boomer segment, research has shown that it is this group of consumers resist significant changes in their lifestyle, therefore marketers need to focus on the health benefits of the product and the value for money it provides (Unilever, 2012). They are not so price sensitive as long as they believe that a higher priced product is actually a superior product (Unilever, 2012). For improving

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market performance in that group, Lipton need to focus on the health and lifestyle benefits that Baby Boomers can derive from consuming their products. Lipton needs to position the product in the mind of this consumer group as not only a refreshing beverage that satisfies thirst, but also delivers numerous health benefits and adds value to the consumer‟s lifestyle, while still remaining a high quality, superior produ ct. The development of Lipton‟s 100 per cent Natural Tea range and naturally occurring 150 mg of protective natural antioxidants has helped Lipton achieve this product placement in the mind of the consumer group (Scribd 2006). Furthermore, Lipton can concentrate more on the promotion and distribution strategies instead of a pricing strategy for Baby Boomers for as mentioned previously; this consumer group is not as price sensitive as other generations. Distribution channels should be easily accessible and readily available, a feat Lipton has achieved by stocking their product in not only large supermarket chains but also independent retailers and boutiques cafes. Promotional strategies need to focus on the sole functional quality of their product, being that it will satisfy thirst and refresh, however, they can also promote the health and anti-ageing benefits of the product. In doing so, Lipton needs to be careful that it doesn‟t alienate its younger cus tomers or risk offending the Baby Boomers. Generation X was born during 1965-1977 and is between the ages of 35 and 47 in 2012. They are characterised by possessing high expectations in life and are very mobile and active, adopting a lifestyle of living for today and not as worried about long-term goals as their Baby Boomer counterparts (Williams, 2010). The media played its part in promoting the Generation X stereotype by portraying them as grunge-listening, Starbucks-drinking, flannel-donning slackers who were quietly revolting against their overachieving, conservative Baby Boomer parents or older siblings (Wisegeek, 2010). If the media portrayal is correct, this consumer group is unlikely to drink tea, however interestingly for Lipton this group is their key target market. Lifestyle choices of Generation X differ greatly to the Baby Boomers and Generations Y and Z, which as a result, has led to different priorities and outlooks. The desire to pursue further education, establish a career, postpone settling down and starting a family and changing social values has resulted in a generation that is highly educated, well-travelled, affluent and want products and services designed for their tastes and lifestyles (Neal, Quester and Hawkins, 2004). Lipton have recently expanded their product range into more niche markets such as fruit, herbal and chai tea in a bid to capitilise on this segment of consumers with large amounts of discretionary income. Demographics: Generation Y and Z Generation Y was born during 1977 to 1994 and fall between the ages of 18 to 35 as of year 2012. Since these people are the children of the original Baby Boomers, they are one of the largest populations among all generations. Because of the size of this consumer group, these people posses the most significant amount of spending

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power in the current market (Lazarevic and Petrovic-Lazarevic, 2007). Generation Y grew up in a high technology and electronic society where the boundaries of countries are becoming more and more transparent and easily crossed. Wireless media networks and the Internet have linked the world together. Generation Y is characterised as educated, self-absorbed and self-reliant, openminded, optimistic, goal oriented and highly motivated toward their perceptions of success (Williams and Page, n.d.). Their lifestyle has a very strong sense of independence and autonomy. As Williams and Page (n.d.) described, those people essentially share eight key values, which are choice, customisation, scrutiny, integrity, collaboration, speed, entertainment and innovation. In order to improve the marketing strategies regarding to those eight values, the following options can be considered by Lipton. In order to attract customers and gain their loyalty, Lipton needs to ensure that their advertisement and marketing strategies are highly attractive to this consumer group. The products and services must be reflective of an active and healthy style of living. As for the loyalty, Generation Y has a unique and special attitude to brand recognition. According to the model of brand loyalty for generation Y (Lazarevic and Petrovic-Lazarevic, 2007), there are five stages for a company to gain its customers ‟ conative loyalty. These are “non-customer”, “cognitive loyalty”, “affective loyalty” and “conative loyalty” as well as “action loyalty” (Figure 1). Figure 1: Model of brand loyalty for Generation Y (Lazarevic and Petrovic-Lazarevic, 2007)

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Firstly, Lipton needs to create positive and attractive brand image and maintain company reputation to attract new customers. Since those factors will strongly affect generation Y consumers ‟ perception of the brand, they will more likely to be a new customer if they have accepted or the brand is in their awareness set. Secondly, in order to increase the change of cognitive loyalty establishment, Lipton has to ensure that its brand image reflects the self-image of generation Y consumers, that is, Generation Y tea drinks see themselves as a good fit with the brand and what it stands for. As Lazarevic and Petrovic-Lazarevic (2007) stated, integrated market communications should play a very significant role in this step. Integrated market communications is a method that “integrates a variety of convincing message across various forms in order to communicate and develop relationships with customers ” (Lazarevic and Petrovic-Lazarevic, 2007). Lipton will be able to provide sufficient product message and brand information to its customers via integrated market communications.

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The most difficult part of this marketing method is that how to become outstanding in the crowd of advertising messages of competitive products and to gain attention. According to Lazarevic and Petrovic-Lazarevic (2007), by the age of 21, a customer has been exposed to approximately 23 million advertising messages. Therefore, they are highly critical of advertising clutter and junk information. They will only focus on messages that are important and reflective of their values. Furthermore, Lipton should push customers to the further stage of loyalty via satisfactory, high quality and available products. It is extremely important that consumers ‟ experiences are not negatively affected by communicating unrealistic expectations. Therefore, Lipton need to always keep their advertisements close to reality. Only if Lipton ‟s products are convincing and maintain the belief that they are better and of a higher quality than their competitors‟, will consumer loyalty increase. Generation Z is now the next generation of consumers who born after 1994 and are young teenagers as of year 2012. Although they are too young to be a major buying power in the tea market, the amount of money they have the potential to either spend or influence to spend is rather surprising. According to Williams and Page (n.d.), Generation Z has $43 billion spending power themselves and influences an additional $600 billion of family spending. Additionally, as Crossfield (2009) pointed out, Generation Z teenagers are the consumers of tomorrow. They will be working, earning and consuming in less than five years. It is time for Lipton to pay attention to this potential market and see it as an opportunity for future business. Lipton should realise that this younger generation is radically different from previous generations. They are highly attached to the high technology such as online games, websites, music, instant messaging and blogging. A consumer research shows that a massive 89 per cent of Generation Z is active online (Crossfield, 2009). They have adopted a very different communication channel and preferences to the previous generations such as their parents. As Williams and Page (n.d.) argue: “They have never lived without the Internet. ” Therefore, in order to target this group for market segment, Lipton needs to move their advertisements online and develop Internet based marketing strategies. Utitlising social media such as Facebook, Twitter, Tumblr and Bebo to deliver messages would be beneficial as these online communities are interactive and enable the consumer to user to be an active participant in their consumption of the product. For example, if a teenager tries a Lipton product, from the comfort of their own home they can post a link on Facebook, twitter to their followers about their experience, post links on personal internet pages and provide feedback on the company‟s website. Lipton can utilise this ever -increasing use of the internet and social media platforms to connect with future consumers of their products. As mentioned previously, Lipton‟s key target market is the 35 years plus age group who know and love Lipton and have been drinking it for years, however recent marketing strategies have focus on converting the secondary target market of 18 –

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29 year old to becoming tea drinkers (Constantaouls, 2004). This marketing strategy has been implemented so as to not offend or alienate the primary target market, while enticing the secondary target market away from the bustling and growing coffee/culture sector of the hot beverage industry. This has resulted in the emergence of Lipton‟s youth strategy in the tea category in an effort to remain appealing to the masses and reduce the likelihood that it would have to rely on the contemporary products (green and herbal teas) and their niche segments (chai tea/latte) (Constantoulas, 2004). Essentially, Lipton aims to retain their existing customer base but to also attract a new, younger generation of tea drinkers. Lipton has successfully achieved this by introducing the Lipton ice tea series. The Lipton ice tea series, as a collection of “Lipton Ice Tea ” and “Lipton Light Ice Tea ”, is one of the most popular brands of ready-to-drink tea products in Australian market. “Lipton Ice Tea ” has six different flavours such as “Lipton Ice Tea Mango ”, “Lipton Ice Tea Lemon ” and “Lipton Ice Tea Peach ”. In order to meet the diverse tastes of consumers the world over, as well as cater to the fickle tastes of Generation Z, Lipton is continually adding new flavours to its product range. Subsequently, Lipton Ice Tea has been one of the more traditional, famous and popular tea drinks on the market since 1964. In order to expand the ice tea market, Lipton formally formed a partnership with Pepsi-Cola in 1992 (Lipton n.d.). According to Unilever (2007), this joint partnership has not only provided a new distribution channel for Lipton ‟s Ice Tea, but also strengthened the global product position for Lipton. The main driving forces behind the marketing strategy of Lipton ice tea series are packaging, consumer welfare and sustainable development as demonstrated by their commitment to produce and supply tea in wholly sustainable matter. The package itself is 100 per cent recyclable and like Lipton tea is easily recognisable with its bright yellow background and red logo, tying it in with Lipton‟s other portfolio of products. To combat the external influences of demographics and lifestyle on the success of Lipton tea and ice tea series the organisation must undertake a multi-generational approach to marketing when considering their marketing mix and overall long-term strategy. Morris (1982, p. 459) states that “Multi-generational marketing is the practice of appealing to the unique needs of individuals within more than one specific generational group, with a generation being a group of individuals born and living about the same time ”. It is based on the two founding principles of products needs changing with life stages and promotional messages and products can reflect the generational values of these consumer segments, which in turn can drive their consumption behaviour (Wellner, 2003). Therefore an understanding of multigenerational marketing is vital to the success of Lipton and its products. It should be noted that generation is only one factor influencing behaviour and the consumption patterns of users, and in some instances, differences within the generation, it‟s subcultures can be larger than differences across generations (Walker, 2003). Each generation contain distinct subcultures. For example, in the

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youth market, one study found that within the youth market (Generation Z) there are up to eight different segments (Neal, Quester and Hawkins). Also, generations do not have sharp boundaries so some individuals near the age breaks often do not belong clearly to either generation. Conclusion In conclusion, Unilever and Lipton are great examples of how adapting to the marketing environment and manipulating consumer influences, as well as the right marketing mix, can influence the decision making process and purchasing patterns of the consumer. Facts and statistics support Lipton‟s position as the number one tea brand in Australia, with a strong reputation and brand image contributing to the effective and successful distribution and promotional strategies.

Although the success of Lipton is obvious now, it should remain innovative and continue to develop their product range and strengthen the Lipton brand. Competitors such as Twinings and Dilmah will continue to compete for market share and profits as well as the number one place in the mind of the consumer. This competition will never end, thus the innovation and development of future long-term marketing strategies shouldn‟t either. If the creation of an ageless society whereby people define themselves more by the activities they undertake and values they align themselves with, rather than by their age , underpins Lipton‟s long term market strategy then give themselves every opportunity to continue to be Australia ‟s number one tea selling brand. As Simms (2008) points out, grandparents could be 45, 65, or 85 and college students could be 20, 30, or 60. The ever evolving generations, changes in social values, alternative lifestyles, emergence of competitors (organisations, other products and new markets) and onset of technology all need to all be considered when Lipton determines the marketing direction it wants to follow in order to remain number one.

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Reference List

Australian Bureau of Statistics (1999), Older people Australia: A Social Report, cat. No. 4109, ABS, Canberra. Constantoulas, K 2004, „AFA Advertising Effectiveness Rewards – Lipton Black Tea: How to climb out of a black hole‟. Unilever Australasia. Viewed on 24

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Crossfield, J., 2009, “Are You Ready for Generation Z?”, viewed on 15 April 2012,

http://www.planetdomainnews.com/news/articles/228/1/Are-You-Ready-forGeneration-Z/Page1.html Datamonitor 2010, „Lipton Tea Case Studies: Achieving longevity in the growing tea market‟. Viewed on 29 March 2012.

http://www.datamonitor.com/store/Browse/?Ntt=lipton+tea Engredea News & Analysis, 2011, “Lipton Iced Tea Launches 100% Natural Line ”, Pepsi Lipton Partnership. Euromonitor 2012, „Tea Global Corporate Strategy: Targeting white space and

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The marketing plan: Lipton, (online), available from: http://www.scribd.com/doc/39915343/A-Marketing-Plan-for-Lipton-Ice-Tea What is Generation X? (online), available from: http://www.wisegeek.com/what-is-generation-x.htm

Appendix A

Figure 2. Market Share for the Major Tea Brands in Australia (Zencha 2007) Brand Lipton Twinings Dilmah Tetley Bushells Nerada Madura

Market Share 21.6% 17.8% 12.8% 11.7% 9.7% 5.3% 4.8%

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Lanchoo

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3.7%

Appendix B

Figure 3. Lipton Hot Tea Product List (Lipton n.d.) Categories

Lipton Black Tea

Products Lipton Quality Black Tea Lipton Quality Intense Lipton Yellow Label Lipton Squeezable Lipton Decaffeinated

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Categories

Lipton Green Tea

Lipton Herbal Infusions

Lipton Chai

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Products Lipton Vanilla Flavoured Black Tea Lipton Quality Tips Leaf Lipton Green Tea Lipton Green Tea Mint Lipton Green Tea Jasmine Lipton Green Tea Citrus Lipton Green Tea Vanilla Lipton Green Tea Peach Lipton Green Tea Apple Lipton Chamomile Herbal Infusion Lipton Lemon Herbal Infusion Lipton Honey Lemon Herbal Infusion Lipton Cranberry Raspberry & Strawberry Herbal Infusion Lipton Cinnamon & Apple Herbal Infusion Lipton Lemongrass & Ginger Herbal Infusion Lipton Orange Herbal Infusion Lipton Peppermint Herbal Infusion Lipton Chai Latte Lipton Chai Latte Sweet Honey Lipton Chai Latte Vanilla Lipton Chai Tea

Appendix C

Figure 4. Lipton Ice Tea Product List (Lipton n.d.) Categories Lipton Ice Tea

Products Lipton Ice Tea Mango Lipton Ice Tea White Tea and Raspberry Flavour Lipton Ice Tea Peach

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Lipton Light Ice Tea

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Lipton Ice Tea Lemon Lipton Ice Red Tea with Rooibos, Tea & Guarana Lipton Ice Green Tea Citrus Lipton Light Lemon Ice Green Tea Lipton Light Peach Ice Tea

24

MARK5800 Group Report

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