In late 1999, India's second largest tea company, Tata Tea, is faced with a highly competitive home market that is about to become more so as impending deregulation takes effect. The company is thus contemplating internationalisation. Tata Tea is grappling with the decision of how to internationalise. It can choose to build its own international brand or, take the opportunity of buying Tetley Tea, the world's second largest tea brand, which has recently been put up for sale. Should Tata Tea build its own brand or buy Tetley. If the decision is to buy, how much should they offer?
The objective of the case is to examine the pros and cons of building an international brand versus acquiring an existing brand, and to understand how to value a brand. The case provides ample data to use a variety of brand valuation approaches to value the Tetley brand. The specific issues that the case covers are as follows: The challenges of turning from a local player into a global player and of entering new markets The growing importance of branding in the tea industry The question of whether to "build or buy" a new brand What are the advantages and disadvantages of an acquisition in general and with particular reference to the acquisition of Tetley Tea by Tata Tea Deciding on an acquisition price for the Tetley brand Demonstrating alternative methods of assessing brand value.
- Brand valuation
- International marketing
- Emerging market
- Market entry