Strategies for Competitive Advantage in Value Added Tea Marketing
Tropical Agricultural Research Vol. 22 (3): 251 - 262 (2011)
Strategies for Competitive Advantage in Value Added Tea Marketing
H.M.U.N. Herath and S. De Silva1*
Postgraduate Institute of Agriculture
University of Peradeniya
Sri Lanka
ABSTRACT. At present the world tea market is rapidly growing with emerging customer needs. The importance of a change from bulk tea exports to value added tea products is highlighted in literature to face the challenges in an increasingly competitive beverage market. Firms failing to address the competitive forces by developing their marketing strategies will lose out to competitors. Thus, marketing strategies adopted by the company leaders, directing their firms towards gaining competitive advantage in the value added tea industry are discussed in this paper. Data were gathered through interviews with the founders of nine firms using an interview guide and using records at the Sri Lanka Tea
Board and the Sri Lanka Customs. The results revealed that brand building, niche marketing, product differentiation, cost leadership, and customer focus were the most prominent strategies adopted by the firms. Opening up new markets abroad, fair trade, environmental sustainability, and faster delivery were identified as important strategies that differentiated firms from competitors and placed them among the market leaders. It was also revealed that the strategic decisions could be attributed to vision of the leaders, risk taking, their enthusiasm and commitment. Identifying marketing strategies depending on the firm’s capabilities and innovations, is therefore, found vital for the value added tea export firms to achieve business success as well as to make substantial contribution to the Sri Lankan economy. Key words: competitive advantage, innovation, leadership, strategies, value added tea
INTRODUCTION
The story of Ceylon tea can be traced back over 200 years ago, when the country was a
British colony. Ceylon tea as a
Strategies for Competitive Advantage in Value Added Tea Marketing
H.M.U.N. Herath and S. De Silva1*
Postgraduate Institute of Agriculture
University of Peradeniya
Sri Lanka
ABSTRACT. At present the world tea market is rapidly growing with emerging customer needs. The importance of a change from bulk tea exports to value added tea products is highlighted in literature to face the challenges in an increasingly competitive beverage market. Firms failing to address the competitive forces by developing their marketing strategies will lose out to competitors. Thus, marketing strategies adopted by the company leaders, directing their firms towards gaining competitive advantage in the value added tea industry are discussed in this paper. Data were gathered through interviews with the founders of nine firms using an interview guide and using records at the Sri Lanka Tea
Board and the Sri Lanka Customs. The results revealed that brand building, niche marketing, product differentiation, cost leadership, and customer focus were the most prominent strategies adopted by the firms. Opening up new markets abroad, fair trade, environmental sustainability, and faster delivery were identified as important strategies that differentiated firms from competitors and placed them among the market leaders. It was also revealed that the strategic decisions could be attributed to vision of the leaders, risk taking, their enthusiasm and commitment. Identifying marketing strategies depending on the firm’s capabilities and innovations, is therefore, found vital for the value added tea export firms to achieve business success as well as to make substantial contribution to the Sri Lankan economy. Key words: competitive advantage, innovation, leadership, strategies, value added tea
INTRODUCTION
The story of Ceylon tea can be traced back over 200 years ago, when the country was a
British colony. Ceylon tea as a