Listen to the Tea Biz Podcast for the week of February 19
Hear the Headlines
| Sri Lanka Launches Expansive Ceylon Tea Promotion
| Green Tea Cancer-Fighting Breakthrough
| Lipton IPO Likely in 2021
| Tea Tourism Stirs from Slumber
Features
A survey of chief marketing officers by the American Marketing Association last year revealed a 74% increase in spending on social media during the pandemic. Investment in social media grew from 13.3% to 23.2% of total marketing dollars spent. Tea marketers increasingly realize that traditional strategies such as advertising and attending tradeshows, while important for branding, convert only a few leads into buyers.
This is because customer expectation has evolved over time making personalization and customization of marketing strategies essential. This week CATA, the Ceylon Artisanal Tea Association, a collaboration of seven tea producers in Sri Lanka, hosted their third “garden tour” webinar. Webinar participants travel virtually to see the garden, processing facilities and meet principals and ask questions face-to-digital-face. Simon Bell, managing director at Amba Tea Estate, writes that “digital marketing is often one of the biggest challenges for small growers and rural entrepreneurs in emerging markets.” Learn more…
Tea Biz asked Bell to discuss the effectiveness of this new approach.
“In any tough times – and this is certainly one of them – opportunities present themselves,” says 36-year-old T. Kettle founder Doug Putman, a turnaround investor who has opened 45 tea retail locations in nine Canadian provinces and six U.S. states. He plans to expand to 100 stores in 2021. Tea Biz takes you to Coquitlam, British Columbia for a walk through one of T. Kettle’s newest mall locations. Learn more…
News you Need to Know
Sri Lanka Launches a 4.5 Billion Rupee Tea Promotion
Sri Lanka’s Tea Board last week authorized the most expensive promotion in the history of Ceylon Tea. Financed by a tax on tea exports, the global promotion targets 12 markets in Asia, Europe, and North America. The campaign is financed by a promotion and marketing tax, first imposed in 2010. Combined, these taxes are the highest levied by a major tea-producing country. Collection was suspended in June 2020 at the request of the Tea Exporters Association after members complained the added expense reduced competitiveness
Navin Dissanayake, Sri Lanka’s minister of plantation industries said the $23 million investment is necessary to sustain and grow Ceylon tea’s market share.
“We need to be more aggressive in our approach in attracting new consumer segments,” he said, adding, the campaign will re-ignite interest in the Ceylon Tea Brand and strengthen is premium position in the global market.
Biz Insight – Dentsu Grant in Colombo will oversee media planning, scheduling, and buying. The Grant Group, founded in 1958, was Sri Lanka’s first internationally recognized advertising agency. Founder Reggie Candappa is considered the founding father of the island nation’s creative agencies. The company was acquired in 2017 and is now part of the Dentsu Aegis, a consultancy with 355 offices in 143 countries that employs 58,000 workers.
Green Tea Compound Acts Like a Sidekick to Cancer Cell Suppressor
EGCG, the major antioxidant in green tea was found by researchers to increase levels of p53, an important DNA-repairing protein and tumor-suppressor. Cancer specialists refer to p53 as the “guardian of the genome” in cells under attack. EGCG acts to stabilize the cancer fighter like a superhero sidekick.
“The direct interaction between the two, points to a new path for developing anti-cancer drugs,” writes Professor Chunyu Wang, an MD and Ph.D. at Rensselaer Polytechnic Institute in Troy, New York. His team’s findings were published last week in the journal Nature Communications.
Biz Insight – Green tea compounds are known to inhibit the growth and even kill tumor cells that cause breast, lung, bladder, prostate, and colon cancers. This has been demonstrated in the laboratory, animal studies, and a 10-year clinical trial when consumed in quantities of at least three cups per day and up to 10 cups per day. A cup of tea contains 200-300 milligrams of EGCG, roughly 50-80 percent of the catechins present in green tea.
Unilever Likely to Initiate a Lipton IPO in 2021
Previously bifurcated Unilever has now completed its consolidation as a single stock headquartered in London. Bloomberg News reports that separating the weaker performing divisions it intends to sell is underway. CEO Alan Jope said it is “highly likely” these will be structured as IPOs. Lipton-PG Tips-Tazo-Pukka Herbs and smaller brands are likely to be split off as a separate company. In the process, a hedge fund or private equity firm may acquire these brands, collectively valued at $3 billion. The dis-assembly is designed to discover the true value of these properties, the sale of which will be the most lucrative in tea history.
Biz Insight – The consolidation into a single business entity, which cost Unilever $1.2 billion, improved the company’s ability to participate in mergers and acquisitions in a category that rewards global scale.
Tea Tourism Stirs After a Long Pandemic-Induced Slumber
Hospitality venture “Taj” in December opened a new tourist resort overlooking the Makaibari Tea Estate in Darjeeling. The Taj Chia Kutir is a 22-acre luxury property in Kurseong, one of five upcoming projects by the Ambuja Neotia Group. A similar property will open near Gangtok in Sikkim in 2022.
The Taj Chia Kitur’s 45 sq. meter rooms sleep four at prices beginning at ? 16,000 per night
Mamata Banerjee, the chief minister of West Bengal, announced this week small business loans of up to 100 million rupees ($1.4 million US dollars) to stimulate the tourism sector which has declined precipitously due to the Covid-19 pandemic. The state will pay half of the interest on these loans during the first year of operation.
“This will largely benefit the homestays and guest houses. The government’s thrust is on the development of rural tourism and smaller places,” writes Sudesh Poddar, president, Hotel and Restaurant Association of Eastern India. He told the Economic Times “We are very happy that the state government has looked up to tourism.”
Biz Insight – Leisure destinations are recovering more quickly than business conference locations like Kolkata. According to V. S. Dwivedi, director of Vistar Properties. “Many Taj units at leisure destinations have already gained over 70% of their 2019 business back. The interest level for Taj Chia Kutir is high,” he said.
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