CURRENT ANALYSIS

Today Tapal has become the largest, 100% Pakistani owned Tea Company in the country. It has
modern tea blending and packaging factories, warehouses equipped with state-of-the-art
equipment and a team of highly dynamic professionals headed by Aftab Tapal himself. Tapal has
9 brands. Its one of the major competitor is UNILEVER. In order to compete with its competitor,
it is using different defensive strategies in order to gain control of that territory the Lipton has
been able to manage

TARGET AUDIENCE:

Target audience plays a very important role in launching the product and making the marketing
strategies. As on the basis of them we make promotional strategies. It different brands target
consumers differently.

o Tapal Family Mixture

The family mixture is targeted for joint family system which is still the major part of Pakistan

o Tapal Tez Dum

This brand is targeted for segment who like strong cup of tea. Like in one Tapal Tez Dum
advertisement its statement is “ Tapal tazdem lagay tha ker ke”

Advertising by Tapal tea

In an increasingly competitive marketplace, greater emphasis is being placed on brand image

development as the basis for consumer discrimination. Advertising has a central role to play in
developing brand image, whether at the corporate, retail or product level. It informs consumers of
the functional capabilities of the brand while simultaneously imbuing the brand with symbolic
values and meanings relevant to the consumer. Television advertising is used as it’s a most
effective medium and hence, this acts as an inducement to consumers to purchase the product.
Sometimes there are TV advertisements designed for different regions of Pakistan to achieve
different advertising objectives in those geographic areas.
Outdoor advertising:

This form of advertising is used to increase out of home visibility in shops and in the streets. The
various activities under the umbrella of outdoor advertising are:

 Billboards
 Pole signs
 Spectaculars

Print Media:

Ten percent of the promotion budget is spent on print media, which includes both newspapers and
magazines e.g Jang, Dawn, The News, She, Akhbar e jehan etc.

Tapal tea sales promotion

A definition of sales promotion becomes more difficult as the industry expands. At its most precise,
it is any scheme designed to sell more product. In the broadest sense, it is everything in the
marketing mix. Examples of tapal tea sales promotion include:

To familiarize consumers with the new blend of Tapal, a certain budget is allocated for the sales
promotion of tapal. Examples of tapal tea sales promotion are:

 Coupons
 Discounts and allowances
 Contests
 Point of purchase
 Rebate marketing
 Gifts and incentives
 Free travel such as free flights.
Sales promotions can be directed at either to the customer, sales staff, and channel members.

Consumer sales promotion techniques in tapal:

 Price deal: A temporary reduction in the price

  Cents-off deal: Offers a brand at a lower price. Price reduction may be a percentage
marked on the package.
 Price-pack deal: The packaging offers a consumer a certain percentage more of the
product for the same price (for example, 25 percent extra).
 Coupons: coupons have become a standard mechanism for sales promotions.
 On-shelf couponing: Coupons are present at the shelf where the product is available.
 Checkout dispensers: On checkout the customer is given a coupon based on products
purchased.

Trade sales promotion techniques in tapal:

 Trade allowances: short term incentive offered to induce a retailer to stock up on a

product.
 Trade contest: A contest to reward retailers that sell the most products.
 Point-of-purchase displays: Extra sales tools given to retailers to boost sales.

Training programs: dealer employees are trained in selling the product.

Distribution Network of Tapal:

Distribution plays an integral role in any company whether it’s a FMCG or utility good. The role
of distribution in the marketing mix is to deliver a product to its target market or final consumer.
Between the manufacturer and the final consumer stands a set of intermediaries performing a
variety of functions. These intermediaries constitute a marketing channel also known as trade
channel or distribution channel. The marketing channels are set of interdependent organizations
involved in the process of making a product or service available for use or consumption. Marketing
channels overcomes the time, place and possession gaps that separate goods and services from
those who need or want them. Tapal Tea is known for its wide distribution network. The Tapal
distribution channel is:

Manufacturer Wholesaler Retailer Consumer

KEY SUCCESS FACTORS
Advertising:
As described earlier that tea market is highly competitive market, therefore aggressive and
creative advertising is very important to retain existing customers and attract new customers.

Currently, Lipton and Supreme are doing aggressive advertising and Tapal is launching counter
campaigns.

Substitutes like Pepsi, juices are currently launching aggressive advertising campaigns and
hammering whole tea industry.

Product Quality:
Product quality is also very important success factor because majority of branded tea consumers
are hygiene conscious and therefore willing to pay a higher price for it.

The freshness of tea should be long lasting, which is ensured by the quality packaging of the
product.

Consistency in taste and aroma of the product guarantees the customer superior and sustained
quality.

Convenient Packaging:
Tea is available in soft packets, sachets, plastic boxes, tea bags and hard packs as per
requirement, convenience and purchasing power of the customer.

The tea packets are designed in a manner which also focuses on convenience of retailers and
wholesalers.

Modern technology has deeply influenced packaging techniques and because of these
innovations customers needs have been better satisfied.

Distribution Network:
The distribution network in Tea industry is very important. To keep track of the rising competition,
both direct & indirect, in the urban markets, the Tea companies have to continuously search for
new markets and expand there distribution networks accordingly. Tapal Danedar has a two-level
channel that contains two intermediaries:

Wholesaler
 Retailer

Tapal tea cartons are sold to the wholesalers who then sell it to the retailers who further sell it to
the final consumer. The important functions performed by Tapal intermediaries are information,
promotion, negotiation ordering, financing, risk taking, physical possession, payment and title.
Tapal’s channel decisions involve relatively long-term commitments to the firms. Tapal has a
conventional marketing channel that comprises of producer, wholesalers, and retailers. Each is a
separate business seeking to maximize its profits that results in a conflict among the channel
members as no channel member has complete or substantial control over other members.

TAPAL has 5 main warehouses in Pakistan which are located in the following cities.

 Karachi
 Hyderabad
 Sukkur
 Multan
 Raiwind

From these warehouses the product move to the distributors as only in north they have 207
distribution channels. And from these distributors the product move to the next, which is retailer
and then to the consumer. This is also one of their strengths that they have a strong distribution
channels. Tapal has a countrywide sales & distribution network; the company has over 400
distributors from Karachi to Khyber operating nationwide.

Financial Position:
Having strong financial position has also become very important in the current competitive
market;

Extended credit period is demanded by the retailers and wholesalers, which requires companies
to maintain higher working capital.

Secondly, the suppliers are to be paid through L/C, which requires instant payment to them.

Customer Loyalty:
In tea industry, consumers are taste loyal. They don’t switch brands easily unless they are not
satisfied with current brand or other brand’s communications may be so strong that it induces
them to try the new brand.

Major players in branded market have established identities and preferences of their brands.
They are in the tea business for last many years.
Market share:
Market share is important because it determines the hold in the market.

If the market share is large, the company can dictate its own terms to its suppliers and retailers.

When the market share is high, it helps safeguard the sales promotion and marketing budget for
the company.

Achieving Differentiation-base Competitive advantage:

A company can use four approaches to achieve a differentiation-based competitive advantage,
which is discussed below:

Incorporate product attributes and user features that lower the buyer’s costs of using the
company’s product.
Tapal has incorporated above approach in following ways:

They are not commanding premium price for differentiating their offerings, as most of the
companies do. Tapal prices are lower than Lipton and higher then Supreme.

They are offering their brands in different packaging like sachets and soft packs to cater the
diverse needs of target customers. With rising inflation and decreasing purchasing power, sachets
give consumers additive benefit.

Incorporate features that raise the performance a buyer get out of the product.
Tapal has incorporated above approach in following ways:

Offering its tea in soft packs.

Introduction of round and metal-free tea bags.

Sustained freshness and aroma in packages.

Incorporate features that enhance buyer satisfaction in non-economic or intangible ways.

Tapal has incorporated above approach in following ways:

In their Ads of family mixture, they are depicting family love and bonding. It is a tea for whole
family. Tagline “mukammal ghar, mukammal chai” provides a very good intangible value.

Tapal giving more value in lesser price.

To Compete on the basis of capabilities – to deliver value to customers via competitive

capabilities that rivals don’t have or can’t afford to match.
Tapal has incorporated above approach in following ways:

Tapal is a family business and they have focused their business on tea only, so they have better
knowledge of tea blending than its competitors. They have invented mixture of leaf and dust
(family mixture) and Danedar, both are new in tea market. Unilever cannot match their capability
of matching different blends & innovating new types of tea. This capability gives Tapal
competitive edge to deliver value to customers in ways rivals cannot.

Differentiating the Value Chain:

Differentiation in their value chain exists in Tapal in following ways:

They have differentiated product R&D activities, as described earlier. They have better product
designs and performance features, which other competitors lacks.

They owns majority of their distribution network. They do not have third-party distribution
system as Unilever have. That’s why they are able to lower costs in distribution and achieve
faster delivery, more shelf space and greater availability than its competitors.

They are doing different advertising campaigns. Positioning of their brands is different from that
of Lipton and Supreme. Only similarity is in positioning of Tapal Mixture and Supreme.

They also have differentiated manufacturing and packaging activities. All their brands have soft
packs currently. Only tea bags are offered in soft carton. Whereas Lipton and Supreme have soft
packs, hard packs and plastic bags.