CLOSE-UP: LIVE ISSUE/TETLEY REVIEW - Time for tea to establish a new brand positioning. Tea must appeal to youth to bring life to a declining market

Tea, the genteel English brew, might not spring to mind as a

ruthlessly competitive market sector. However, two big agency rethinks

in as many weeks suggest that competition among the UK's major brands is

reaching boiling point.



Last week came the news that Tetley is reviewing its advertising out of

D'Arcy, its incumbent for more than 20 years, prompting talk that its

famous cartoon tea folk are to be thrown out with the dregs.



This followed the news that Mother had resigned its Typhoo account,

citing creative differences. Fallon will take over from Mother's

controversial "Two thumbs fresh" message.



While Tetley is tight-lipped about its creative strategy, its decision

to review points to big changes. One catalyst may be its recent

take-over by Indian giant Tata, although a major reason for the

acquisition was the perceived strength of Tetley's marketing power. The

deal made Tata the second-largest tea manufacturer in the world.



When D'Arcy won the account in 1979, as D'Arcy-MacManus Masius, it set

about helping Tetley change the face of the tea market. The agency

introduced campaigns for the revolutionary tea bag, fronted by comic

characters Gaffer, Sidney and Maurice, to name a few of the tea

folk.



Over the years, the characters moved from their original casting as

factory control workers to take on real-life situations. With the

developing endline "That's better, that's Tetley", they concentrated on

building loyalty through consumers' interest in the exploits of the

white-coated tea-lovers.



PG Tips, the long-serving king of tea brands for the British public, was

knocked off its perch. Its reaction was to adopt a similar strategy.



It launched its own teabags and reintroduced its long running chimps

campaign through what is now BMP DDB.



From their conception in 1956, through a revamp in 1970, the chimps

became synonymous with PG Tips. Their best known incarnation was as the

piano movers and helpful tea lady in the classic 1970 spot "Mr Shifter",

but variations featuring the voices of top entertainers, such as Peter

Sellers, made them among the most recognisable frontmen in

advertising.



Their strength as brand icons was demonstrated following the decision to

sideline them for 18 months just as the Tetley challenge was heating up

at the end of the 1970s. During their absence PG saw its market share

drop for the first time. Since the return of the chimps, PG has branched

out with a campaign featuring Caroline Aherne, as well as tactical work

associated with the launch of instant tea and new bags. But the apes

retain the top spot.



Not so their rivals, the tea folk. According to Lawrence Green, a Fallon

founding partner, the lovable toons could pay the price for a marketing

strategy that has fallen into the trap of concentrating on the

advertising rather than the brand. He blames the key brands for

fostering consumer complacency about tea. "The big brands don't stand

for anything, and the marketing strategy is stuck in the dark ages," he

says. "Tetley has undoubtedly been successful, but it is trapped by that

success."



He prescribes a complete change for the brand, citing the way in which

Lowe Lintas revived Weetabix as a core cereal brand: "They talked to

consumers in a new way."



Market conditions also argue for a drastic rethink, with the latest

figures from ACNielsen pointing to difficult times for Tetley and Typhoo

in particular.



Although Tetley reigned supreme for years, PG Tips fought back

successfully.



Its Pyramid bags are now the top-selling tea brand and the company has

emphasised its ascendancy this year by expanding sales by 1.6 per cent

in what is a declining market.



But rivals Tetley and Typhoo both saw a substantial drop in sales this

year. And while supermarket own label products have threatened brand

supremacy in the past, this sector also declined, with sales down 5 per

cent year on year.



Increasingly the attention of consumers is being grabbed not by the big

brands, but by the speciality and herbal minnows. The fastest growing

brand in the top ten is Twinings Herbal, sales of which grew 9.3 per

cent year on year.



Tea as a social drink has fallen behind coffee, with the success of

chains such as Costa and Starbucks. Unilever fought back last year with

its Cha cafe concept in Brighton, which sought to glamorise tea by

offering a younger clientele iced, frappe, fruit and infusion teas as

well as the conventional cuppa.



This is where the conventional teabag is losing out - in the kind of

customer it attracts. It's an increasing worry that those consumers

hooked early with iconic campaigns for Typhoo ("You Only Get an oooh

with Typhoo"), Tetley and PG Tips are starting to disappear. Some think

there is now a vacuum as the manufacturers struggle to get

brand-conscious, coffee-drinking youngsters to turn to tea.



"Consumers identify with tea's advertising, not the brand values," Green

says. He won't be drawn on how Fallon will work on Mother's brand

positioning, but adds: "The legacy is all about perforations, pyramids

and promotions - that's got to stop if young consumers are to take it

seriously."



According to Green, Typhoo's break from the old-style advertising is the

right way to go. Premier Brands reviewed the account out of the newly

formed Delaney Lund Knox Warren last April, bringing in Mother to shake

things up. Typhoo has thought ahead of its rivals in seeking to lose its

cuddly image to lure younger consumers.



Typhoo has tried a number of ad agencies over the years - including FCO,

BMP DDB, Saatchi & Saatchi and Leo Burnett - but has never found a "big

idea" to rival the chimps or tea folk.



The brand's longest running campaign was "Typhoo puts the T in

Britain".



A variety of other approaches has been tried, including the 70s series

of commercials starring an animated gnu, and documentary-style spots

emphasising tea's role in helping to forge personal relationships.



In the 80s tea manufacturers tried to break into the soft drink sector,

launching soon-to-bomb fizzy versions of iced tea. Brooke Bond even made

the same mistake twice. Although its Coolbrew tea drink failed to move

tea sales up in 1991, it tried again in partnership with Pepsi and

Britvic, to launch the Nestea brand. Yet for now, tea defies this kind

of brand extension.



As with all major FMCG clients, the Tetley review is shrouded in

secrecy. D'Arcy's chief executive Barry Cook will not be drawn on future

strategies to fill the gap left by the Tetley tea folk and Tetley will

not comment on the list of agencies thought to have been lined up by the

pitch handler Agency Assessments International.



Some sources suggest the Tata acquisition, which, as well as giving it

access to the UK and European markets within which Tetley operates,

gives the UK-based company the clout to expand further overseas. Seen in

this light, perhaps a global campaign is on the cards.



While D'Arcy states it has no intention of losing the account, some are

sceptical that the agency will keep the business. As one source close to

the review puts it: "Why would Tetley call a review after 23 years if it

wasn't seriously thinking about changing tack, both strategically and

with a new agency?"



BIGGEST BRANDS SURVEY 2000 - HOT BEVERAGES MARKET

Brand Company Approximate Ad spend

sales in % change in 2000

2000 (pounds (pounds

millions) millions)

1 Nescafe Nestle 335-340 -6.9 22.7

2 PG Tips Van den Bergh 125-130 2.5 10.6

3 Tetley Tata Tea 110-115 -6.4 8.1

4 Kenco Kraft Foods 80-85 18.8 11.3

5 Typhoo Premier Brands 60-65 -6.2 2.0

6 Twinings R Twining 35-40 10.2 0.9

7 Horlicks SmithKline

Beecham 35-40 -6.8 1.3

8 Cadbury's Hot

Chocolate Premier Brands 35-40 11.9 1.9

9 Maxwell House Kraft Foods 30-35 -10.3 2.4

10 Yorkshire Tea Taylors of

Harrogate 30-35 2.1 0.3

Source: AC Nielsen.