Copyright 2009 Dennis S. Vogel All rights reserved.
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I have more advice & insights for you based on another Inc magazine article. The article is - "Mighty Leaf is a Darling of Upscale Restaurants and Natural-Food Stores."
The URL is - http://www.inc.com/magazine/20090101/mighty-leaf-is-a-darling-of-upscale-restaurants.html
I'm tempted to exclaim I wouldn't dilute a brand for all the tea in China.
Despite, the favorable results so far, I'm skeptical about the future results. According to various sources, the US has been in a recession since 2007. This can skew results compared to what will happen when the economy is strong again & people figure they can afford premium products at premium prices.
After struggling through a long, hard recession, some consumers will still be cautious. Others will shake off the gloom & live a little-maybe even a lot. They'll figure they deserve some relief & some will be right-they do deserve it.
As I was reading this article, I thought about staycations & cocooning. These options can decrease the number of people who would drink Mighty Leaf Tea (MLT) because they wouldn't be in hotels & restaurants much (if at all) & MLT wasn't available in stores.
I wonder if restaurants & hotels that serve Mighty Leaf Tea also sell extra pouches of the tea to customers. If they don't, they could start. These extra sales would let people drink MLT at home & could increase total Mighty Leaf Tea sales. It may cannibalize its sales in hotels & restaurants, if MLT drinkers would opt to not eat meals in hotels & restaurants because they'd have MLT pouches at home. I don't know if MLT is a big enough attraction to inspire people to eat in hotels & restaurants instead of at home. Its availability may (potentially) affect which hotel or restaurant people choose to eat in.
Mostly, I think MLT is probably a nice extra indulgence.
If MLT is popular enough to influence where people eat, hotel & restaurant owners, managers & chefs are apt to be irate when they learn MLT is available in stores.
Selling extra pouches of MLT would bring in a little more money for hotels & restaurants.
Since some people are losing their 5-6 figure incomes, they'd be glad to get MLT for a lower price. But if part of the attraction is the upscale cachet, they may prefer a different brand when their incomes increase again.
Taste won't always keep customers. Various product taste tests showed people don't always discern a brand's identity when they taste products. To some extent, they taste what they expect or want to taste. If something tastes like they expect, they're apt to think it's their preferred brand.
Pick whichever product category you want: What are the differences between expensive brands & inexpensive brands? A varying level of higher quality, but mostly it's a higher price most people can't afford to pay. The exclusivity makes a big difference.
Since many disruptive brands typically offer the same or similar qualities & benefits. A few brands will increase their quality a little & offer significantly lower prices than MLT. These brands will become more popular & MLT will become less popular because the owners made a lower price an important feature by selling their tea to grocery stores. The main benefit of buying MLT or a similar product will be saving money to get essentially the same taste.
It probably would've been better to have adjusted the quality down a little & rebrand & rename the product grocery stores stock. It's probably too late to fix it now.
Now, to avoid losing their premium edge & their sale channel in hotels & restaurants, I advise Mighty Leaf Tea owners to add something to their upscale tea, which tea drinkers want. Then they should rebrand their product.
They can't afford to drop the Mighty Leaf Tea name-YET. They could introduce a new tea for the new economy (when the economy starts to improve). If they wait too long, their brand will lose its premium cachet.
They'll need to change the name eventually to avoid consumers' confusion. Mighty Leaf Tea shouldn't be used as a name for what middle market grocery offers & what upscale hotels & restaurants offer.
(Note: According to F. Scott Fitzgerald- "The test of a 1st-rate intelligence is the ability to hold 2 opposed ideas in mind at the same time & still retain the ability to function.")
Many people are intelligent enough to figure out the difference between premium & regular tea based on the context of where it's offered, but they have better things to do with their mental energy.
Choosing tea isn't rocket science, so don't expect people think about it much.
Since the MLT owners started their product in hotels & restaurants, they don't need people to find this new premium product on store shelves. They need tea drinkers to recognize its name in menus. A name like Elite Mighty Leaf would emphasize the new quality & taste. MLT could provide leaflets to be included in menus &/or table tent signs, which can be read from 2 sides. Their leaflets &/or table tent signs could have some information about their new premium product.
Eventually, to preserve & hopefully strengthen their brands, they can increase the emphasis on "Elite" & slowly phase out "Mighty" or "Leaf" to reduce brand confusion.
As Michael J. Silverstein (co-author of "Treasure Hunt" & "Trading Up") would probably say, their current brand is apt to be trapped in the middle.
I doubt it'll be a premium brand much longer. It probably won't be lowbrow brand either. So, for people who can afford the best, it won't be appealing. For people who can afford to splurge occasionally, it won't seem like a luxury.
Thank you for using my blog. Please let me know if I should clarify anything.
Copyright 2009 Dennis S. Vogel All rights reserved.
When you compete against big businesses with big budgets you need powerful marketing strategies & tactics. You'll find them here-
https://thriving-small-businesses.blogspot.com/
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