Madura Tea in the Tea Market in Thailand - Report Example

Introduction Madura Tea, one of the leading tea companies that is 100% Australian, has its roots in the late 70s and only started marketing the products in 1981. Established and owned by husband and wife Michael and Norma Grant-Cook, Madura Tea Co aims to bring to his plantation the best teas in the world to mix with his own, to produce a unique and unparalleled tea in terms of taste, flavour, and aroma. In recognition of the fact that teas of any kind are viewed as oriental or Eastern products, Madura Tea must make sure its product will capture the luxurious segment of the hot tea market in Thailand. Now, with hopes of penetrating the already-saturated tea industry of this country, the premier Australian tea company is faced with challenges to ride the competition and establish a niche of its own against some giant names who started early in this country such as Uni President Co. Ltd., T.A.C. Beverage Co. Ltd., and Oishi Group Co. In recent years, green tea is receiving wide promotions from tea-making companies for its health benefits due to its high anti-oxidant levels. In a 2008 report by the Department of Agriculture and Food titled “Western Australia Agri-Food and Fibre Market Outlook,” stated that herbal tea retail revenues through supermarkets in 1995 were worth $US15.8 million and specialty tea were worth US$23.1 million.” Madura believes it need to respond to this trend to target the market for antioxidant-rich hot drinks in Thailand. The launch of Madura Tea augurs well to the company’s thrust to establish its presence not only in Australia based on the health and wellness niche to meet consumer demand. Situation Analysis a. Political and Legal Environment Trading of tea is affected largely by implementing guidelines and policies by some regional and global policy-making bodies such as South Asian Association for Regional Cooperation (SAARC) and the World Trade Organization (WTO). Such legal and political issues may create some threats to the marketing opportunities or provide revenue leeways through lesser taxes. The Thailand government, on the other hand, is often reported by foreign press to be unstable, corrupt and undemocratic due to some power players and military conflicts. These factors may have an impact also to the opportunities that can be explored in Thailand. b. Economic Environment Production of tea outputs are not an immediate concern since shortage in the supply of tea may only be relatively small since there are over three dozen countries globally that can be a major source for supply of tea. The only threat to pricing in the supply of tea may be caused by the continuous fluctuation in the price and availability of materials. When shortage in the supply of tea occur, this can have some effect to Madura, which is concerned with the source or origin of his tea materials to sustain and maintain the kind of brand Madura teas are known in Australia. But shortages of this kind may also not impact Madura that much since it produces its own tea outputs from its Estate. c. Social and Cultural Environment The green tea market is considered one of the hottest markets in Thailand. Beside being a socially and culturally-accepted norms for most Asian and Oriental countries to drink tea in several social and family gatherings, however, there is also an increasing market in Thailand that must be captured as well – the young professional market whose disposable income are widening. These captured market demands a more convenient, pleasant and fashionable way of enjoying tea imported from abroad or with Western touch. Among other demographics, other consumer segments in Thailand are generally – Those who put high premium to living a healthy lifestyle because they believe they should be responsible for their well-being. Finding ways to relieve stress through drinking hot teas due to the recessionary fall out and demand to look for more work. Reliant on a more natural, organic way of treating oneself from diseases and drinking tea is a traditional, customary norm in Asian countries like Thailand. Conscious about helping in the public information awareness drive to protect the environment. Looking for quality, imported products where they can experience the true value for the expense they spend. d. Technological Environment In an effort to improve the productivity level of tea outputs, modern technology has been very helpful in this regard. With the ever increasing demand for tea products, the former manual and organic way of farming utilized by Malura will no longer be helpful to meet demands and beat the competition, especially if the vision is to penetrate the hot drinks market of Thailand. Among the projected benefits of using modern facilities and machineries are: plantation space are minimized, labor and human resource expenses are cut, and in turn, makes the whole tea production process faster. SWOT Analysis Strengths Recognized for producing premium and expensive organic tea products. Good reputation in the Australian government Improving experience in global adaptation Experience in marketing and rolling out new product lines Advanced facilities in tea production Weaknesses Lacks experience in competing with leading tea drinking brands. Challenged by the huge distances for transportation Research and development External Opportunities Growth possibilities in different global footprints such as Thailand Innovation of tea formulation with the power more than that of the health benefits of tea Consumers in Thailand may be on look out for fresh, imported premium labels Broad cultural diversity in Thailand Will benefit from purists tea consumers in Thailand. External Threats Strong competition Price war Conclusion and Recommendation Madura’s proposed foray in the tea market in Thailand will provide it with the best opportunities of capturing the Asian tea consumers, but will be facing several challenges in terms of meeting demands, competitions from “big players” and the political environment of this country. However, Madura may need to address some specific behavior drivers to penetrate this hot market. These are – How Madura will be accepted as a health and wellness tea alternative from the more homegrown tea outputs originally from Thailand. How to make drinking or consuming Madura teas will be made as an excuse for a break or rest for most Thailand professionals at work. How with a well-conceived marketing mix, the launch of Madura teas will drive consumers to try and buy a more expensive tea imported from Australia. How Madura will encourage the younger health- and non-health conscious adults to try the Madura tea products. How to remove the perceived negative notion that tea drinking allegedly causes bad health benefits. Hence, Madura tea in Thailand may be launched to showcase the breadth of quality tea experiences that this 100% Australian company can deliver. To do, Madura will employ an integrated marketing campaign and activities. In addition, the following action plans must be considered by the marketing team holding the proposed roll-out of the tea products in Thailand: 1. Strategic outlets within popular locations, apart from supermarkets, that can give visibly high premium and prestige to Madura tea products. 2. Aggressive three-month national ad campaigns in various medium: print, radio, television, web, mobile technology, and others. 3. At least two- to three weeks promotional campaigns in major supermarkets. This presence must include promotional stand designed with the branding themes for the product and announcement to consumers to have a free taste of the Madura premium tea. 4. Promotional offers for avid buyers of the product. 5. Events plugging featuring some light entertainment, contests and giving away of free products. References “Analysis: The Green Tea Companies in Thailand.” Thailand Board of Investment, 28 July 2009, (28 July 2009) “Coffee: Black as hell, strong as death, sweet as love,” Dotpoint.com.au, 25 May, 2009, (28 July 2009) Department of Agriculture and Food, Western Australia 2008, Agri -Food and Fibre Market Outlook, Government of Western Australia, 28 July, 2009, (28 July 2009) P. Copley, Marketing Communications Management: Concepts and Theories, Cases and Practices, 2004, Butterworth-Heinemann, 27 July 2009, (27 July 2009) “Philosophy & History,” Madura Tea Estate, 28 July 2009, (28 July 2009) S. Dibb, and L. Simkin, Marketing Briefs: A Revision and Study Guide, Butterworth-Heinemann: Chartered Institute of Marketing, 2001, 27 July 2009 (27 July 2009) Read More