In the last 10 years there have been major shifts in consumption from loose to packaged milk. According to a Nielsen 2014 report, branded milk accounts for a 12% share in Pakistan’s $11 billion milk market. The fastest conversion to branded milk has been in the tea whitener category. Now, in a bid to further tap into this market Nestlé has introduced a variant to its regular EveryDay liquid tea whitener called EveryDay Double Creamy liquid tea whitener (EveryDay also markets EveryDay milk powder).
The market leader in the category is Tarang with a 52% share (Source: Nielsen Retail Audit Report, 2015) with Haleeb’s Tea Max coming in second with a 25% share. The remainder of the market is made up of smaller brands, such as Chaika, CupShup, Dostea, Qudrat and of course, EveryDay.
In a market where 72 billion cups of tea are consumed annually (Nestlé Internal Estimates), Muhammad Fahad Yousaf, Marketing Manager, Nestlé Pakistan, identifies two distinct sets of consumers.
“The first are people who are extremely price sensitive; they will compromise on taste but not on price and therefore opt for liquid tea whiteners such as Tarang, Tea Max and CupShup – which are priced at Rs 20 for a 250 ml pack. The second are people willing to pay for taste and opt for all-purpose milk brands which are costlier but creamier than the usual tea whiteners available in the market.”
He adds that although these all-purpose brands (Good Milk, Haleeb, Milkpak and Olper’s) are not positioned as tea whiteners, 85 to 90% of their 250 ml packs are used for tea creaming, despite the fact that they are priced at Rs 30 (compared to Rs 20 for a 250 ml pack of Tarang or CupShup), the reason being the superior taste they bring to a cup of tea.
Given that the tea whitener category tends to be very commoditised (consumers are quick to react to any price change and switch brands), Nestlé decided to differentiate their offering, and based on research that emphasised the importance of strength and creaminess in tea, launched EveryDay Double Creamy in July. The brand is marketed on the basis of the concept of Malai maar ke, evoking the kind of strong and satisfying tea sold in dhabbas across Pakistan.
In terms of strategy, Double Creamy targets consumers who value taste; it does not compete with regular tea whiteners and has been placed next to all-purpose milks. Nestlé is initially focusing on urban centres, but plans to eventually focus on the rural areas as well.
The double creaminess advantage has justified a premium and EveryDay Double Creamy is sold at Rs 30 for a 250 ml pack. The tetra crystal pack, with an extra fold on the corners also differs from the norm as it is said to have been well received by the market. The brand has been launched in a 250 ml SKU, although Yousaf anticipates the introduction of 125 ml and 500 ml packs once it establishes itself on a sustainable basis.
In terms of strategy, Double Creamy targets consumers who value taste; it does not compete with regular tea whiteners and has been placed next to all-purpose milks. Nestlé is initially focusing on urban centres, but plans to eventually focus on the rural areas as well – if not as a daily tea whitener, then as one used on special occasions.
Orientm McCann, EveryDay’s creative agency, developed the launch TVC in which a confident, decision-making housewife chooses EveryDay Double Creamy for her family. This is a continuation of the old positioning, although this TVC shows a younger, witty, fun-loving, outgoing wife who offers her husband the satisfying cup of homemade tea that he craves for. Yousaf explains that although the brand is sticking to the “housewife who makes the best decision for her household” concept, they are experimenting with more contemporary values, as expressed in the EveryDay milk powder TVC that had Shoaib Malik and Sania Mirza taking opposite stances on most household matters but agreeing that EveryDay milk powder is the perfect partner when it comes to tea.
Double Creamy was launched during the Eid-ul-Fitr holidays with extensive TV integration and celebrities endorsing the brand by tasting it on live Eid shows. According to Yousaf, experiential tastings are planned for the next quarter, whereby small stations with a dhaba ambience will be set up in malls and supermarkets and customers will be invited to sample tea that comes with a dhabay ki chai flavour.
Nestlé is confident the product will deliver on its promise and says that within the first month the brand has exceeded all expectations in terms of planned sales.
“This differentiation can be a game-changer in the liquid tea whitener world,” says Yousaf.
However, he still sees commoditisation (brand hopping by customers due to price sensitivity) as a major threat to profitability and brand building. He hopes that the differentiation inherent in Double Creamy will make price considerations irrelevant and encourage consumers to value taste and consistency.
Going forward, one of the challenges is that EveryDay tea whiteners are milk-fat based and therefore cost more to produce compared to vegetable-fat based tea whiteners, such as CupShup, Tarang and Tea Max. EveryDay so far accounts for only seven percent of the market share in the category and although Nestlé wants to grow this share, they also want to achieve this profitably. The double creaminess advantage has given Nestlé the opportunity to charge a premium – whether this will prove sustainable in the longer term remains to be seen.