TABLE OF CONTENT

1.0 INTRODUCTION..................................................................................................... 1 2.0 PRODUCT DESCRIPTION........................................................................................2 3.0 PRODUCT MARKETING MIX (4Ps) VALUE & SATISFACTION...................................5 PRODUCT................................................................................................................. 8 PRICE.....................................................................................................................11 PLACE....................................................................................................................12 PROMOTION........................................................................................................... 14 4.0 CONCLUSION.......................................................................................................16 REFERENCES............................................................................................................. 17

1.0 INTRODUCTION Marketing needs to be consider as a critical issue of companies whether theyre big or small, for profit or not-for-profit, domestic or global. Marketing mix which is an important

concept of the companys marketing process includes four factors: Product, Price, Place and Promotion (well-known as 4Ps). It is always a difficult problem with the questions How to create right product, sell at righ price, in the right place and use the suitable promotion for the firm to implement successfully its performance. To have a deep understand of this marketing concept, the essay will concentrate on analizing 4Ps in the Tan Hiep Phat Beverage Groups marketing campaign of Zero Degree Green Tea during launching and developing period in Vietnam. With the huge potential ready to drink (RTD) tea market and high consistent growing (more than 34%), we believe that this case will be typical for getting more knowledge about marketing mix strategies.

2.0 PRODUCT DESCRIPTION Official website of Tan Hiep Phat shows that: Tea is a traditional raw material made into a typical and popular drink in the whole world especially in Asia. Positioning in the part of refreshment need and paying attention to the health benefit of the people, in early 2006, Tan Hiep Phat launched ready to drink tea trade

mark named Zero Degree Green Tea to the market, a breakthrough introducing a convenient drink in 500ml PET bottle with green colour and trade mark logo (two circles) to the dynamic pace of life, and successfully sent the message an outstanding drink compared with ordinary refreshment drinks on account of its nutritious value and health benefit. Green Tea bears the strong trend of the modern time and is a wise choice in the taste of enjoying tea of the Vietnamese people.

The picture of Zero Degree Green Tea In 2007, Zero Degree Green Tea immediately became one of the fastest growing brands in Vietnam. The research of Neilsen company in 2007 indicated that its Brand Equity Index is 6.4, one of highest in Vietnam (only 8% of all Fast Moving Comsumer Good brands have scores of 5.5% and above). In 2008, Zero Degree Green Tea achieved year 5 sales target of US$16 million in year 3. The Economist (April 26th May 2nd 2008) stated that Zero Degree Green Tea is thought to be the countrys fastest growing brand, with sales almost doubling last year. It also maintained market leadership and an average share 51.5% in the last 3 years (from 2007 to 2009). In 2010, Zero Degree Green Tea received the Vietnam National Brand award.

Thanks to huge success of Zero Degree Green Tea and green tea products of other competitors, RTD tea consistently recorded the fastest total volume growth in soft drinks in 2009 and 2010 in Vietnam. RTD tea sales increased by 34% in total volume sales in 2010. According to the report titled Soft Drinks in Vietnam (2011), Tan Hiep Phat (THP) Group was formerly known as Ben Thanh Beer & Beverages Co Ltd, and founded on 15 October 1994. At the beginning, it focused on producing and trading beer and alcoholic drinks. The company has continued to improve its product quality by upgrading to new manufacturing technology and applying ISO standards. It is one of few local producers willing to invest in Rearch and Development (R&D) and branding activities to increase volume and value sales the report stated. In 2004, Ben Thanh Beer & Beverages Co Ltd changed its name to Tan Hiep Phat Manufacturing and Trading Co Ltd. The Soft drinks in Vietnam report (2011) also shows that: Tan Hiep Phats head office and factory are located in Thuan An district (Binh Duong Province), spanning over 110,000 sq m. The factory exploits a chain of fully automatic production systems to ensure hygiene and product quality. In particular, Tan Hiep Phat invested heavily in launching the Enterprise Resource Planning system from SAP in April 2010. This step expressed the ambition of the company to boost its production rate and to reduce waste in order to enhance efficiency and product quality. The company offers a wide product portfolio of non-alcoholic drinks in Vietnam, including bottled water, RTD tea, and sports and energy drinks. Zero Degree, Dr Thanh and Number 1 are the manufacturers most popular brands. Tan Hiep Phat appears to be most active in RTD tea. It offers many RTD tea flavours, such as: sugared or sugar-free green tea, herbal tea, and winter melon tea. The leading players products are aimed at more health conscious consumers, for example, females and the elderly.

The segmentation of Zero Degree Green Tea is consumers that has already drunk carbonates, mineral water and even purified water because of its superior healthy, cooling benefits with the previous essences of green tea. Zero Degree Green Tea target market is vietnamese young adults whore suffering the negative impact of fast-paced lifestyle such as pollution, great pressure at school and work, etc and raise awareness of healthy drinks use (Best Sustained Success, 2011). We can see obviously that young Vietnamese people under 30 years old account for 56% in total 86 millions (Statistical handbook of Vietnam 2009, 2009), which becomes wide potential market for Zero Degree Green Tea.

3.0 PRODUCT MARKETING MIX (4Ps) VALUE & SATISFACTION Marketing mix which is third four steps of creating value for customers and building customer relationchips consists of a blend of the four marketing mix elements (Product, Price, Place, Promotion) that transforms the marketing strategy into real value for customers. Marketing mix is the set of controllale, tactical marketing tools that the firm blends to produce the response it wants in the target market (Armstrong & Kotler, 2010). Figure 3.2 shows the marketing tools under each P. Figure 3.1. An Expanded Model of the Marketing Process

Figure 3.2. The Four Ps of Marketing Mix

Amongst the other marketing mix models have been developed over the years is Boom and Bitner's 7Ps, sometimes called the extended marketing mix, which include the first 4 Ps, plus people, processes and physical layout decisions. Another marketing mix approach is Lauterborn's 4Cs, which presents the elements of the marketing mix from the buyer's, rather than the seller's, perspective. It is made up of Customer needs and wants (the equivalent of product), Cost (price), Convenience (place) and Communication (promotion). Figure 3.3. Four Ps versus Four Cs

Product Price Place Promotion

Customer solution Customer cost Convenience Communication

Customers see themselves as buying value or solutions to their problems (Armstrong & Kotler, 2010). They see themselves as capturing value when total benefits received are more than total costs of searching, buying, using, maintaining & disposing the product. They want to be satisfied through getting the product value that helps them to solve their needs & wants as efficiently, effectively and competitively as possible. The twofold goal of marketing is to attract new customers by promising superior value and to keep and grow current customers by delivering satisfaction (Armstrong & Kotler, 2010). Therefore, marketers would do well to think through the four Cs first and then build the four Ps on that platform (Armstrong & Kotler, 2010).

PRODUCT Official website of Tan Hiep Phat shows that:

Produced on modern Japanese technological production line with selected verdant leaves plucked out of tea plants on plains, green tea is able to keep its natural and pure flavor. Green tea is mad through hot extraction process in order to insure food safety and hygiene standard and to detain precious essences of green tea. With the use of heat-resisting 500ml PET bottle, the choice of trade mark logo (two circles), and the shape in green color friendly to the eyes which creates a feeling of becoming attached to nature, green tea bears high aesthetic value under the sponsorship of Number One trademark. Zero Degree Green Tea has two original flavors: sugar-free green and green tea with lemon flavor. With nutritious element such as vitamins E, C, and especially EGCG, a strong antidioxide element, green tea helps you reduce stress, reinforce resistance, prevent skin ageing and cancer in order to cool down your body and spirit after a hardworking day or after a long trip. It is very convenient to bring along Zero Degree Green Tea on trips, picnics, or in conferences and sometimes simply drink it at home instead of purified water. Now Tan Hiep Phat also provides a variety of green tea products such as lemon green tea with honey in PET bottle, honey tea in glass bottle and even prepare to launch green tea in box. It has divesified the containers of original flavours such as producing lemon green tea in glass bottle, PET bottle and can to satisfy customer needs and wants.

Various products in green tea product line of Tan Hiep Phat As we mentioned above, Zero Degree Green Tea success has already been actualized. It sustained market leadership and an average share 51.5% in the last 3 years (from 2007 to 2009). In 2010, Zero Degree Green Tea received the Vietnam National Brand award. Thanks to huge success of Zero Degree Green Tea, Tan Hiep Phat continues to lead RTD tea with a 41% share of off-trade value sales in 2010. Other competitors such as C2 of URC Vietnam, Green tea 100 of Tribeco (Saigon Beverages), Lipton Pure Green tea of PepsiCo Vietnam, etc account for 59% share of offtrade value sales in 2010. Soft drinks in Vietnam report (2011) identified: In Asia, RTD tea is the core product type of most of the leading companies. RTD tea sales are expected to grow by a 22% off-trade volume Compound Annual Growth Rate (CAGR) over the forecast period. This is much slower than the review period CAGR as the category approaches maturity. Nonetheless, the fast rate of innovation in RTD tea might see stronger growth if players capture the consumers attention by launching more interesting products. This means green tea has became core product type of the leading beverage companies and green tea product line is in the ongoing to maturity but it still has strong possibilities to develop if the producers pay attention to research and development for product diversification. It also means

that green tea product life cycle is at the stage between growth and maturity. In this stage, companies try to divesify their green tea products with various flavours or containers to utilize their profitability and defend their market share like the same way Tan Hiep Phat has been doing.

PRICE Tan Hiep Phat enjoyed the advantage of the first-mover in RTD tea market in Vietnam. Although RTD tea was present in the country long before the 2000s, it only started to develop fast from 2006 when Tan Hiep Phat launched Zero Degree Green Tea (Soft Drinks in Vietnam, 2011). Thus, Tan Hiep Phat applied the new product pricing strategy to enjoy the advantage of

market-skimming through charging higher price to get more profits. In early 2006, Zero Degree Green Tea was positioned at the higher price (approximately 20% more than the other beverage) but it was still preferred because of its health benefit (Hoang, 2007). The evidence is that Zero Degree Green Tea immediately ranked atop of the fastest growing brands in 2007 in Vietnam. Its success inspired more than 20 competitors such as C2 of URC Vietnam, Green tea 100 of Tribeco, Lipton Pure Green Tea of PepsiCo Vietnam, Queen Tea, etc and even illegal copycat competitors (Best Sustained Success, 2011). Therere now not much difference in the price of RTD tea in terms of retail format (Soft Drinks in Vietnam, 2011). Figure below proves this. Figure 3.2.1. Retail price comparison of RTD green tea in 2011 in Vietnam PET bottle 500ml 360ml 450ml Zero Degree Green Tea VND 7,500 VND 5,500 VND 6,000 As we already analized the product level and product life cycle, Tan Hiep Phat applies the going rate pricing policy to defend their market share along with insuring their profitability. PLACE Zero Degree Green Tea inherited total distribution channels including 300,000 outlets with more than 200 distributors in all the 64 provinces and cities that Tan Hiep Phat has built (Kotler, Kartajaya, & Hooi, 2008). Tan Hiep Phat applied intensive distribution which means consumers can easily purchase its products in supermarkets/hypermarkets, food/drink/tobacco specialists, independent small grocers, and even street vendors (Soft Drinks in Vietnam, 2011). By this way, consumers get product value and satisfaction. This distribution power forces small beverage producers to stop their manufacturing or become copycat companies. The recent evidence is that C2 Green Tea 100 VND 6,800 Lipton Pure Green Tea

the trademark O2 and Omega of Viet My and Quang Minh companies litigated by Tan Hiep Phat because of trademark infringement.

Zero Degree Green Tea is popular in many supermarkets, hypermarkets

and independent small grocers Both Tan Hiep Phat and Pepsico Vietnam have the strong nationwide distribution network to establish a presence in the market. Third giant Saigon Beverages is considered weaker in distribution but now continues to invest in upgrades to machinery and improved distribution

through cooperating with retailers to promote its products within, for example, supermarkets and hypermarkets, using billboard and in-store posters or discounting.

PROMOTION At the beginning, Tan Hiep Phat chose boosting communication solution with advertising on televisions (high frequent broadcasting spots on TV), in printed and electronic newspapers and cooperating with the below the line activities (Hoang, 2007). The marketing campaign has

transferred successfully the message: an outstanding drink compared with ordinary refreshment drinks on account of its nutritious value and health benefit. Green Tea bears the strong trend of the modern time and is a wise choice in the taste of enjoying tea of the Vietnamese people. Its success is partly advantage of first mover in the market, the first firm offered customers the choice for nutritious and healthy product in tradditional green tea flavour instead of carbonates and purified water.

Zero Degree Green Teas poster emphasizes natural freshness, cooling body and other nutritious value Tan Hiep Phat chose two circle logo for Zero Degree Green Tea which symbolize the balance of cooling body and soothing mind aimed to raise customer awareness of its major health benefits. Zero Degree Green Tea was also sponsored by NumberOne, a successful trademark before according to the assessment of Kotler et al. (2008), which gained customer reliability. Each advertisement reflected the companys knowledge of the market and the behaviour of local consumers. Zero Degree Green Teas advertisements during its launch period focused on the natural freshness of the product on hot days. This advertising quickly captured the attention of consumers as few other brands offered similar themes. For example, C2 was launched right after Zero Degree Green Tea but it is rapidly in the passive state because it chose similar slogan cool and clean as Zero Degree Green Tea which couldnt create the difference with the product

launched before. Although C2 applied penetration pricing policy and strongly invested in advertisement on TV and other mass media methods, it accidentally restricted its segmentation because it tried to persuade the consumers who already drunk carbornates (not wide beverage market) to drink it. Accompanied with its unavailability for sales, the launching of C2 initially supported the strong growth of Zero Degree Green Tea. In 2010, the leading player launched a new advertising campaign for Zero Degree Green Tea, which focused on its relaxation and stress-relieving effects.

4.0 CONCLUSION In summary, Tan Hiep Phat chose the wise step when it has invested in research and development to become the first mover in competitive green tea market with Zero Degree Green Tea trade mark. The right message an outstanding drink compared with ordinary refreshment drinks on account of its nutritious value and health benefit with suitable logo and green shape color that create comfort feeling and freshness for customers raise successfully awareness of nutritious and healthy drink for customers. Lauching Zero Degree Green Tea offers customers the choice for nutritious and healthy drink instead of carbonates and ordinary purified water. Along with distribution power, a strong nationwide distribution network, Tan Hiep Phat makes customers easily purchase the product everywhere and close or restrict the competitive chance of both small

and even multinational competitors. Zero Degree Green Tea has combined the boosting media communication with advertising on TV, in printed and electronic newspapers and other below the line activities and therefore, supported effectively the strong trademark growing and off-trade volume sales. These activities provide customer sastifaction of finding, purchasing, using and two way communication, which means delivering product value and satisfaction to the customers.

REFERENCES Statistical handbook of Vietnam 2009. (2009). (2011). Best Sustained Success. Zero Degrees Green Tea Campaign, Tan Hiep Phat Beverage Group. Soft Drinks in Vietnam. (2011, March). Retrieved June 2011, from Euromonitor International Web site: http://www.euromonitor.com Armstrong, G., & Kotler, P. (2010). Marketing: An Introduction Global Edition (10th ed.). New Jersey: Pearson Higher Education. Hoai, T. (n.d.). Product & Health: Zero-degree green tea - a shower. Retrieved June 2011, from Tan Hiep Phat Group Web site: http://thp.com.vn/ Hoang, D. D. (2007, 12). The case of Zero Degree Green Tea and C2. Success Magazine.

Kotler, P., Kartajaya, H., & Hooi, D. H. (2008). Think ASEAN! Havard Business School Press.