Pierre M. Uribe MKTG 140 W01 EXECUTIVE SUMMARYThe Pepsi-Lipton Tea Partnership development of an advertising andpromotion plan has as its primary objective to introduce its first-ever LiptonSparkling Green Tea in United Dairy Farmers stores of central Ohio. ThePartnership is a joint venture between Pepsi-Cola North America Beveragesand Unilever. Venture created to expand significantly the marketing anddistribution in selected markets of Unilevers range of Lipton ready-to-drink (RTD) teas.The Launch Agency has developed a comprehensive advertising andpromotion plan to position the first-ever Lipton Sparkling Green Tea, a newready-to-drink blend of green tea, in the United Dairy Farmers stores ofcentral Ohio. “Lipton Sparkling Green Tea brings together the great taste and the goodness of tea that are trademarks of Lipton Ice Tea, with the fun and sparkle of a soda.” Mary Barnard, VP/GM, Pepsi-Lipton Tea Partnership
Pierre M. Uribe MKTG 140 W011. SITUATION ANALYSIS• RTD Tea IndustryGreen tea is a segment of the RTD tea industry. Reported sales of RTD teaslast year were $ 1,042.4 millions of dollars, having green tea as the mostpopular beverage with the heights numbers of new products. The averagefamilies consumption of RTD tea beverage is 3.2 times per week, number thathas been reduced as a result of the deteriorated economy that forces familiesto brew tea at home. In 2006, the industry showed the heights growthpercentage, 26.2%, since 2003. However, the industry has experienced adrastic change in 2008 with a decline growth of -1.8%. For Lipton, thisexperience in the industry has not been different. Lipton reported sales of $236.3 million dollars in 2008 with a decline growth of -3.4% from 2007.Conversely, according to Lipton, green tea has been the fastest segment ofthe RTD tea category, with an average annual growth rate of 16.5% withLipton tea as the major driver of this growth and accounts for 42% of categorysales.• Company & BrandPepsiCo and Lipton Iced Tea combined to created Pepsi-Lipton Internationalas a joint venture. This partnership was designed specifically for the NorthAmerican market 10 years ago and to be established as the leading RTD teaprovider in America and Canada. The joint venture designates each of their
Pierre M. Uribe MKTG 140 W01strengths to develop a major product. Pepsi-Lipton International will sell RTDtea to franchise bottlers, therefore increasing Pepsis portfolio of healthyrefreshment beverages.Lipton is one of Unilevers largest beverage brands with sales that exceed 2.8billion of Euros and is the worlds third largest beverage brand. PatrickCescau, director of Unilever Foods Division, said: "We have a strongpresence in the developing and emerging markets yet there is plenty of "whitespace" to move into. These markets are the next in our planned rollout andwe see Pepsi as the best partner to help us achieve this."On the other hand, PepsiCo is one the worlds largest food and beveragecompanies, with annual revenues of $27 billion dollars. Its principlebusinesses include Frito-Lay snacks, Pepsi-Cola beverages, Gatorade sportsdrinks, Tropicana juices and Quaker foods. PepsiCos portfolio includesfifteen brands and each generates $1 billion dollars in annual sales.• EconomicWith a downturn in the current American economy and high unemploymentrates, consumers may be more inclined to spend less than previous years.Perhaps, consumers may be forced to brew tea at home instead of buyingRTD tea at the local stores. However, Lipton Sparkling Green Tea feeds anemotional and health need and its consumers are health conscious youngprofessionals that will buy the product before switching to a lower quality RTDtea brand.
Pierre M. Uribe MKTG 140 W012. MARKETING ANALYSIS• Target MarketThe launch agency has researched and selected one primary market to bethe focus of the Lipton Sparkling Green Tea advertising campaign. Theprimary target market is “All health conscious young adult professionalsbetween the ages of 21 to 32 living in central Ohio” with an estimatedpopulation of 47,800 people. This target is tightly defined and analyzed byfour general targeting characteristics:Demographics. – The target audiences’ demographics are: • Young adults part of the generation X and Y • Family and single households • White, Hispanic, Asians, and Black • Between the age of 21 and 32 • Middle Class male and females with incomes above 45,000.00Psychographics. – The psychographic study realized for this campaignindicates similarities in the consumers’ activities, interest, and values. Theseare the following: • Activity: Workout, Social Events • Interest: Health, Profession • Values: Personal Image, HealthGeographics. – The camping focuses on the Central Ohio-Columbus-FranklinCounty.
Pierre M. Uribe MKTG 140 W01Behaviographic. – The target audience for this campaign is most likely tospend a couple dollar more on a product that will help them maintain a goodhealth and image.• ProductLipton Sparkling Green Tea, a new Ready-To-Drink blend of green tea, withsparkling water and fruit flavors, is a refreshing complement to a healthylifestyle. Lipton Sparkling Green Tea is made of the finest tealeaves sourcedfrom all over the world, which provide naturally protective flavonoidantioxidants. An added benefit to Lipton Sparkling Green tea is theantioxidants that can help the body to protect itself against free radicals,molecules that can damage cells. Mary Barnad, VP/GM, Pepsi-Lipton TeaPartnership stated, “Lipton Sparkling Green Tea brings together the greattaste and the goodness of tea that are trademarks of Lipton Iced Tea,with the fun and sparkle of a soda. Now consumers really can have it all”. Thedrink will be available in regular (green tea), berry, strawberry kiwi, and dietstrawberry kiwi flavors. Packaged in 20-ounce, 1.5 liter, and 16.9 oz-twelvepacks.• PriceLipton tea is the worlds leading tea brand and their products are available inover 150 countries around the world. Consumers tend to prefer Lipton teaproducts over other brands because they believe the brand has the ability and
Pierre M. Uribe MKTG 140 W01willingness to deliver on its brand promises, which is “experience theunexpected”. The product ranges in price from $ 1.19 to $ 5.92 as follows: 20oz : $ 1.19 1.5 liters : $ 2.98 16.9oz – twelve packs : $ 5.92• PlaceThrough the joint venture agreement, PepsiCo would distribute Lipton teaproducts, specifically Lipton Ice Tea in more than 60 countries where PepsiCohas already established its corporate presence. The partnership has two maingoals: to move Lipton Ice tea brand into new distribution channels andmarkets. PepsiCo will implement the placing of the product by using theircurrent logistic tools in central Ohio. The distribution links the product to theprimary market and focus of the Lipton Sparkling Green Tea advertisingcampaign. The Lipton Sparkling Green Tea will be placed in United DairyFarmers stores located in mid-to upper-class neighborhood of Central Ohio-Columbus-Franklin County.• PromotionLipton Tea has an extended list of advertising promotion that started back onJanuary 9th of 1953, where Robert B. Smallwood, former president of ThomasJ Lipton Inc., and Samuel Winokur, president of the Tea Association of theUnited States, conducted the first tea promotion campaign in different
Pierre M. Uribe MKTG 140 W01markets around the United States. During the beginning of the year of 2006Lipton Tea and BikeTown were making it possible for thousands of Americansto live active lives by giving away bikes. The campaign was brought to lifethrough an integrated program including a national on-pack promotion andonline sweepstakes to win bikes, biking gear and a 10-market national tourwith team Lipton and BikeTown USA through Baltimore/Washington, Boston,Chicago, Dallas, Houston, Detroit, Los Angeles, Miami, New York andPhiladelphia. Team Lipton and BikeTown will give away one bike a day and ahealthy supply of Lipton Tea for 150 days. In October of 2009, Lipton IcedTea created an advertising promotion called “Win a smart car promotion”where consumers could enter it by simply purchasing any two Lipton Iced Teaparticipating products from participating stores and follow the prompts toenter, the last 4 digits from each two participating product barcodes as well asthe receipt number, by internet or mail. Lipton Tea recognizes partnershipsand online promotion campaigns as a good communication tools and they arethe most common form of promotion done by the brand throughout the years.• Social TrendsThe Lipton Sparkling Green Tea has been formulated for consumption of bothfemale and male with some degree of health awareness. Over the pastseveral years, there have been more educational campaigns about healthand nutrition making the American population more alert when purchasing theday-to-day beverages and food. For the last decade, the health benefits of tea
Pierre M. Uribe MKTG 140 W01have gained wide coverage in the media. Studies continue to show thebeneficial properties of teas, with health benefits ranging from lowercholesterol levels to improve arterial health and decreasing chance of cancer.This positive press has definitely increased the demand for tea. Both the needfor convenience and positive press on tea, have created an increase in salesof tea products, specifically ready-to-drink (RTD) teas sold in single-servecontainers.• Competitive AnalysisThere are many RTD tea products on the market, but Lipton tea’s mostrecognizable competitors are Arizona, Snapple, and Nestea. However,Arizona and Snapple are marketed to a different consumer segment thereforethey are not going to be included on the competitive evaluation. Lipton tea’smajor competitor is Nestle with its Nestea Ice Tea line of products. LikePepsi-Lipton, Nestle Refreshment Company has copied an agreement withanother soda manufacturer, Coca Cola (Pepsi’s biggest competitor), to formthe Coca Cola-Nestle Refreshment Company. Nestle’s alliance with CocaCola has the same purpose as the Pepsi-Lipton Tea Partnership, which isglobal distribution. The existence of Coca Cola-Nestle partnership in theUnited States and some other countries remains a threat to the goals ofPepsi-Lipton. Coca Cola-Nestle has two major products: Nestea sweetenedwith natural lemon flavor and diet Nestea with natural lemon flavor. Both areavailable in 12oz cans and in 16oz wide mouth glass bottles. In addition to the
Pierre M. Uribe MKTG 140 W01cans and bottles, Nestea is available in refrigerated cartons. The tea ispreservative free and made from a brewed product taken back down to a teapowder. While Coca Cola- Nestle continues to develop the packaging andmarketing strategies for Nestea Iced Tea, there are no recent announcementsof impending new products or new flavors of iced tea to be developed soon.There is a limited flavor of Nestea Iced Tea, which is basically the originaliced tea flavor. The company has not shown interest to capture the emergingdemand for healthy RTD iced tea products. This can be a good opportunityfor Pepsi-Lipton to exploit. Lipton Tea can continue to expand its marketposition by capturing the growing market for healthy RTD iced tea.• SWOT Analysis Strengths Opportunities • Uniliver is a multinational company • On-the-go consumers prefer RTD and well recognized in the industry. products as their daily beverage. • Strong brand Image and brand • Capture Pepsi already extended awareness. market with the partnership. • PepsiCo is a major distributor in the • The new demand of tea as a United Stated and Canada. result of health awareness. Weaknesses Threats • Consider new product. • The downturn economy • The industry becoming competitive • Coca cola-Nestle partnership by the increasing demand of tea • The preference of natural juices products. over green tea for health • Many brands are launching new conscious consumer RTD tea products.
Pierre M. Uribe MKTG 140 W014. CONSUMER RESEARCH• Secondary ResearchA recent study conducted on 2007 by Essential Insight on Consumer Marketsshowed Tea as one of the most underdeveloped beverages in the UnitedStates. Tea barely compares in market size to beverage categories such ascarbonated soft drinks, coffee and water. Currently, the market is wortharound $1.63 billion and it will enjoy double-digit growth over the next fiveyears according to most projections. With advertising expenditures in excessof $100 million, it is clear that RTD tea marketers are supporting the categoryand driving this projected increase. “Tea fits into the well-establishedmovement among aging baby boomers to seek out foods and beverages thatpromise wellness and anti-aging effects. These aging boomers are not themajor market for RTD iced tea beverages like Snapple, which targets collegestudents and recent grads, nor are they the prime buyers of established teabag and instant tea brands such as Lipton, which skew toward seniors.Boomers are the drivers of specialty teas, in every way, shape and form.”(Essential Insight on Consumer Markets. 2007). What makes tea, a nutritionalpowerhouse, exclusively situated in the beverage category is that tea isnaturally healthful.Packaged Fact’s new report, “Tea and Ready-to-Drink Tea in the U.S.”, 3rdEdition, studied tea’s new importance and the impact on the market and theconsumer’s mind. This report examines the U.S. tea market—retail and food
Pierre M. Uribe MKTG 140 W01service. Retail sales come from numerous channels such as supermarkets,drug stores, mass merchandisers, club stores, convenience stores, dollarstores, and health-natural foods stores. Demand for convenience will continueto drive the market for RTD tea. The American lifestyle has changed.Traditions are changing and gone are the days when tea was a delicate andrigorously prepared beverage. The inception of RTD tea has even led to theconsumption of tea as a casual beverage, just like soft drinks.• Primary ResearchThe Launch Agency primary research was conducted using a questionnairewith 10 consumers that purchased RTD green tea beverage from the UnitedDairy Farmers, located on Short North-Columbus 43215. Primary researchrevealed a better and more thorough understanding of RTD green teabeverage consumers and their personal experience, associations, andperception of the brand and the product. According to survey results, LiptonSparkling Green Tea has standard consumer satisfaction. Consumers enjoythe product because of its refreshing and unexpected flavor. Typically aconsumers introduce Lipton Sparkling Green Tea to him or herself as a resultof a desire and search for an on-the-go low calorie beverage. Consumers findLipton Sparkling Green Tea to be refreshing, with a very good flavor, and avery light and fruity taste. Also, consumers would highly recommend LiptonSparkling Green Tea to people who want to try something new, who enjoyLipton iced teas already, and anyone who wants a zero-calorie alternative to
Pierre M. Uribe MKTG 140 W01soda but still want a delicious taste!4. ADVERTISING GOALS AND OBJECTIVES• Marketing ObjectiveThe Launch Agency’s campaign goal is to introduce Lipton Sparkling GreenTea, a new Ready-To-Drink blend of green tea, in United Dairy Farmers(UDF) stores in central Ohio-Columbus-Franklin County. United DairyFarmers stores are the perfect vehicle for the introduction of Lipton SparklingGreen Tea because their commitment to quality products, fast-friendlyservice, and clean bright stores; with nearly 28 stores throughout ColumbusOhio. Columbus has an estimated population of 47,800 people that are healthconscious, young adults, professionals between the ages of 21 to 32, which isthe main target market for this advertising and promotion plan.Lipton Sparkling Green Tea should successfully cover the increasing demandfor RTD healthy beverages and new social trends, trends that are making theAmerican population more alert when purchasing the day-to-day beveragesand food. UDF stores will satisfy the consumers need for RTD healthybeverages and add to the overall reputation of Lipton Iced tea.The launch agency will increase the brand awareness among the 47,800people, subject of this campaign, within the 2010 fiscal year.
Pierre M. Uribe MKTG 140 W01• Communications ObjectivesWith in one year, this campaign has the following communication objectives: • To inform about the introduction of Lipton Sparkling Green Tea in United Dairy Farmers central Ohio stores-Columbus part of our test market area. • To create a 95 percent recall awareness of the Lipton Sparkling Green Tea among consumers part of our test market area. • To create purchase intention for the Lipton Sparkling Green Tea among consumers part of our test market area. • To create familiarity with the benefit of consuming Lipton Sparkling Green Tea among consumers part of our test market area.5. MEDIA• Media Options and Mix SelectionThe Launch Agency suggest the use of the following traditional advertisingmedias: • Outdoor advertising (billboards and mobile advertising) • Local magazines (Columbus Alive and C-bus magazine) • Local Radio (97.1 sport radio and 97.9 WNCI) Continuity The Agency recommends capitalizing on their advertising during the periods that best meet the product sales, spring, summer, and fall, which
Pierre M. Uribe MKTG 140 W01 will also act as a budget check function between advertising efforts to save money. Reach The Launch agency suggest advertising for the Lipton Sparkling Green Tea will obtain an average of 90 percent of its Central Ohio-Columbus test market in the first two month. When the desired reach is met, Lipton Sparkling Green Tea will sustain optimum brand awareness. Frequency An average frequency of 5 will maximize the efforts of the advertisers and meet the numbers necessary to create a state of action on the consumer’s part of our test market area.• Media StrategyThe scope for the Lipton Sparkling Green Tea is narrowly defined in terms of“Demo/Geographics”: health conscious young adults professionals betweenthe ages of 21 to 32 leaving in central Ohio-Columbus. In theory, the targetmarket consists of approximately 47,800 people who have been pre-selectedby the Launch Agency. For a successful campaign, Lipton Sparkling GreenTea’s goal is to implement the following: • Place Billboards around Central Ohio-Columbus • Design a mobile advertising tool with the product’s logo or brand • Place print advertising on Columbus Alive and C-Bus magazine • Place radio advertising on Sport radio and WNCI
Pierre M. Uribe MKTG 140 W01This traditional advertising media have been selected as the best possiblechoice to reach the selected target audience. Outdoor, magazine, and radioadvertisements were selected because size of the test market as well as thecost of exposure. The agency’s decision to omitted the Internet is becausethe Psychographic of the target audience.6. CREATIVE BRIEF What is the opportunity and/or problem the advertising must address? The opportunity in need to be addressed is the health benefits of drinking Lipton Sparkling Green Tea. What do we want to do as a result of the adverting? Create desire to purchase Lipton Sparkling Green Tea. Who are we talking about? To all health conscious young adults professionals between the ages of 21 to 32 leaving in central Ohio-Columbus that purchase on to go RTD green tea product in the UDF stores. How do target market members think and feel about our product now? Target members feel good about the product and would highly recommend it to people who want to try something new, and enjoy Lipton iced teas already, and anyone who wants a zero- calorie alternative to soda but still want a delicious taste. What is the key response we want? Brand Loyalty. What information/attributes might help produce this response? Brand Fulfillment: Quality, Liability, and Consistency.
Pierre M. Uribe MKTG 140 W01 What aspect of brand personality should advertising express? Quality. Are there media or budget considerations? No media or budget consideration. What other information might affect the creative direction? The economy.7. PROMOTION PLAN• Sales PromotionIn order to introduce the first-ever Lipton Sparkling Green Tea in United DairyFarmers stores in central Ohio-Columbus, particularly to the 27,800 peoplepart of the target market, a sales promotion has been created by the LaunchAgency to attract and influence consumers when buying RTD green teaproducts. With this in mind, the agency has set objectives to effectivelyintroduce the Lipton Sparkling Green Tea in United Dairy Farmers stores incentral Ohio-Columbus and increase product distribution. The salespromotional plan will include the following items:Product DemonstrationThis will include an appearance from Lipton Sparkling Green Tea educatorwho will be place into each United Dairy Farms stores to demonstrate thenew product features and benefits to the potential consumers.
Pierre M. Uribe MKTG 140 W01SweepstakesA sweepstakes entry form is provided on flyers and brochures to be handedout by the Lipton Sparkling Green Tea Mobile; winners will be announced onthe radio and magazines.Mobile AdvertisingThe Lipton Sparkling Green Tea Mobiles, SUVs with a giant version of theproduct on the roof, will be around Central Ohio-Columbus providing freesamples, flyers, and brochures.8. CAMPAIGN EVALUATIONWithin the first year of the positioning of the product, the Launch Agency willmeasure the success of the campaign by assessing the “buy-in” of thenumber the Lipton Sparkling Green Tea sold in the United Dairy Farmersstores. Other measures include: • Promotional responses and mobile advertising accomplishment. • Pre and post tests levels of awareness, attitude and purchase intention objectives, which will be monitored on a monthly basis. • Scanner data for product sales.
Pierre M. Uribe MKTG 140 W01CREATIVE DISCRIPTION
Pierre M. Uribe MKTG 140 W01 ReferencesWikipedia. 2009. “Lipton.” Available at http://en.wikipedia.org/wki/LiptonInstitutional. 2007. “A Marketing Plan for Lipton Ice Tea Institutional AffiliationDate.” Available at http://www.advanceessays.com/samples/Marketing_Plan.pdfIdeal Media. 2009. “State of Industry ’09.” Available at http://www.nxtbook.com/nxtbooks/idealmedia/bw0409/index.php? startid=S1#/42FoodBizDaily. 2009. “New product: Lipton Sparkling Green Tea from Pepsi-Lipton tea partnership.” Available at http://foodbizdaily.com/articles/28876-product-lipton-sparkling-green-tea- by-pepsi-lipton-tea-partnership.aspxMedia Post. 2009. “Lipton Intros Sparkling Green Tea.” Available at http://www.mediapost.com/publications/index.cfm? fa=Articles.showArticle&art_aid=104662Find Articles. 2003. “Unilever and PepsiCo Create Pepsi Lipton InternationalRtD Tea Joint Venture in Selected International Markets.” Available at http://findarticles.com/p/articles/mi_m0EIN/is_2003_Oct_14/ai_10882792 2/Goggle. 2009. “Lipton tea promotion history.” Available at http://www.google.com/search? q=lipton+tea+promotion+history&hl=en&client=safari&rls=enUniliver. 2009. “Win a smart car promotion” Available at http://www.unilever.com.au/brands/Promotions/Lipton-Ice-Tea- WinaSmartCarPromotion.aspxEssential Insight on Consumer Markets. 2007. “Tea and ready-to-drink tea inthe U.S.” Available at http://www.packagedfacts.com/Tea-RTD-1282368/