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Fresh Brew: Tata Tea, Godrej, HLL focus on value game

05-July-2004
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Fresh Brew: Tata Tea, Godrej, HLL focus on value game

In an aggressive bid to pump up volumes, Tata Tea Ltd and Godrej Tea Ltd are now shifting their marketing focus to the ‘economy packs’ strategy. Meanwhile, Hindustan Lever Ltd has introduced its brand Brooke Bond Red Label tea in value packs priced at Rs 10 in an effort to widen its consumer base. A new marketing war is gaining momentum in the Indian branded tea market.

For starters, Godrej Tea is in the process of rolling out its mass market brand Godrej Chai House in value packs at low price points in select pockets in uttar Pradesh. The company plans to go for a national roll-out in the next few months. As for the rationale behind the company’s move, says Godrej Tea managing director A Mahendran: “Our objective behind the initiative is to increase the consumption of branded tea in the country. Our marketing thrust is going to be on our popular brand Chai House for the time being.” In accordance with this strategy, the company plans to launch Chai House in value packs at lower price points in the near future.

As for Godrej Tea’s foray into the iced tea segment, he says the new initiative is now under a developmental stage. “In another three or four months we will enter this segment. We are also looking at tie-ups for dispensing the new product,” adds Mr Mahendran. It was two years ago that Godrej Tea entered the Indian tea market by launching Godrej Chai House (popular brand) and Godrej Noble House.

On the other side of the spectrum, Tata Tea has recently launched two economy packs priced at Rs 5 and Rs 10 (in the leaf category) to promote its brand Tata Agni. On the company’s new initiative, says Tata Tea Ltd vice-president (marketing) Vivek Mathur: “With this move, we want to increase our penetration levels. We have introduced these packs in Orissa and Maharashtra to start with. With the launch of the new Tata Agni value pack, we want consumers to graduate from loose tea to branded tea.”

To announce the launch of its new initiative, the company is in the process of rolling out a new communication package which includes television advertising and in-shop advertising (PoP) plans. Currently, the company is conducting an aggressive trade-connect programme which involves wholesalers, stockists and retailers across the country, adds Mr Mathur.

Recently, Hindustan Lever Ltd launched its brand Brooke Bond Red Label in value packs to pump up volumes. As for the rationale behind HLL’s new initiatives for Brooke Bond Red Label, says a company spokesperson: “Our objective is to generate consumption and penetration for our tea brand. Earlier, we launched Taaza in a value pack priced at Rs 5. And now, we have introduced Red Label in a Rs 10 pack.” At present, Hindustan Lever Ltd leads the pack in the branded tea industry in India.

Clearly, a new marketing storm is slowly brewing in the Indian tea cup.

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