Tea in Philippines

The case illustrates the strategy of Universal Robina Corporation launching a Chinese product in a different market than the company was used to. That new market was characterised by a different history and environment, different beverage consuming habits and a large part of low income population. As said in such case, the Philippines' Ready-to-Drink industry was undeveloped until 2004 for many reasons, mainly:

* The Philippines, unlike other Asian countries, was not historically a tea drinking country.

* Because of the tropical weather, people usually demanded refreshing beverages.

* The most popular products in the Philippines beverage market were carbonated drinks and fruit juices, followed by coffee.

* The average Filipino ignored the healthy benefits of tea consumption and was also unaware of the negative effects on consumption of carbonated sotf drinks.

* Imported brands were too expensive for the average customer income.

Despite tea was introduced in the country before unsuccessfully, ready-to-drink tea was a new market in Philippines. In my opinion, factors of success were as follow:

As this firm did with others products, it focused its strategy on creating locally - brand products, accesible for the average Filipino which were cheaper than imported brands.

The time of launch of the the ready - to - drink tea in Philippines, as said at the end of the article, argued to market research showing the trend that the Filipino carbonated soft drink market was beginning to stagnate and URC was promptly ready to offer a new kind of beverage that could fill an eventual new demand.

The low cost products. Until 2003, the only available tea on the market was just distributed ones by imported brands which were too expensive for average customers. The local low production costs of ice tea were a factor that made it to spread it quickly. The target segments were the lowest - to the middle income brakets.

Diversification. The innovation through a selection of flavour choices: in order to adapt to consumer tastes, URC provided a large variety of flavours.

Advertising. The same as in the Chinese market people were aware people about the health benefits related to consuming significant quantities of tea, the company did it through advertisement in the Philippine market, bringing to the people the awareness of this product.

To summarize, the big advantage of URC, as it did before with others produtcs like coffee, it was the ability to create local brand product that fit into the local consumer habits. And as we just said, the success of the ready - to - drink tea it can be also attributed to the huge promotions about the benefits of drinking tea encouraging people to live healthy lifestyles.