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 they’re big or

small, for –profit or not-for-profit, domestic or global. Marketing mix which is an important

concept of the company’s 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 Group’s 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 country’s 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 Phat’s 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 manufacturer’s 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 player’s 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 who’re 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 Customer solution

Price

Place

Promotion

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 anti-

dioxide 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 off-

trade 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