Tata Tea goes international

Tata Tea’s induction was on the cards but was delayed with the management debating whether such a move would be beneficial because of its strong presence in markets such as India, Southeast Asia and West Asia. However, Ajoy Misra, managing director of TGB, says: “We launched Tata Tea in Canada two-three years ago and it is doing well there. Remember Canada is an evolved tea market, where you have established brands. Tetley is already there, with Unilever’s products.”TGB proposes to push Tata Tea deeper into the Canadian market, targeting areas beyond where the Indian diaspora is. (Its taste is considered stronger than Tetley’s.) The same strategy will be applied in the UK, where Tata Tea is available in select outlets.
These efforts are tied to TGB’s objective of building a strong portfolio of products that can straddle price points and segments. “Currently, there are white spaces, notably in coffee and water, which could be filled both organically and inorganically. In the UK, the top-end, mid-end and bottom-end are covered with Tea Pix, a luxury tea brand; Tetley, in the centre; and Tata Tea now, at the lower end. We would ideally like to replicate this model in other markets and across our verticals. If that necessitates an acquisition, we will do it. If an in-house product can fill the gap, we would look at that as well,” said Misra.

According to Misra, the acquisition of the Map coffee brand in Australia last year was part of this plan to fill gaps in key markets.

In India, the company might consider introducing one of its international coffee brands such as Eight O’ Clock (available in the US) or Grand (available in Russia) to fill the vacant slot in packaged coffee. The company is also mulling taking Tata Coffee’s packaged brand, Mr Bean, national as an alternative. Mr Bean is a popular packaged coffee brand in Kerala and Tamil Nadu.

TGB will also look at co-creating products with Tata Group companies in areas such as ambient beverages.
Misra says it is also talking to “institutes and institutions”, exploring the prospect of jointly developing new products with them.

This aggression by TGB comes with the group and company chairman Cyrus Mistry laying special emphasis on the consumer and retail vertical among three other clusters as part of his Vision 2025 document. The plan here includes achieving a market capitalisation comparable with the 25 most valuable companies in the world in the next decade. Among other things, Mistry proposes to invest $35 billion (Rs 2.1 lakh crore) in the next three years in consumer & retail, defence, aerospace, financial services, realty, and infrastructure.