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MIBS6002 Global Management And Culture

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MIBS6002 Global Management And Culture

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Course Code: MIBS6002
University: The University Of Sydney

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Country: Australia


Why/how Coca cola expanded in the Chinese market by releasing a new healthy product Green Tea rather than U.K?


Coca-Cola is a well popular brand of beverages, and wants to introduce a new healthy product that is green tea in Chinese market. The major reason for entering this market is the attractive green tea culture of china. Chinese culture and society consist of tea lovers, where teahouses can mostly found in business districts and Chinese neighbors. Tea is one of the important part of Chinese culture and is included in seven necessities of daily life in china. To enter this market, the company would grow and package green tea in china by the local people there, and market with the name of Coca-Cola (Cai, 2018).

(Source: (financialexpress, 2018)
China green tea culture 
The company chooses Chinese market over U.K because:

Tea culture introduced thousands of year back, initially the tea was grown, which was later spread to rest of the countries. China found and start using tea 3000 years ago(Chaffee, 2017)
Even after other beverage options available in the market, tea has never lost its attractiveness, instead green tea attractiveness is rising with time due to health concerning population.
People are more concern about their health in China, due to which green tea will be a successful launch in the market
Since green tea is grownlargely in the country itself, for entering the market Coca-Cola do not have to export green tea to the country, instead the green tea can be manufactured in the country by local people, which means the cultural difference will be considered and adapted easily.
According to global comparison revenue in million US$, In China most revenue of tea is generated in 2018, with market volume of US$19,105m(statista, 2018).

(Source: (statista, 2018)

According to latest report presented by “the United Nations Food and Agriculture Organization Intergovernmental Group,” global tea production, which includes green tea productionand usage are expected to constantly rise over upcoming decades, driven by extreme demand in emerging and developing country, mainly China and India (financialexpress, 2018).

Green Tea culture of U.K

The tea was not introduced in Britain until mid-17th Marketing green tea inU.K could be more challenging due to cultural difference (Greig, 2015).
As per the statistics, Majority of people in U.K are black tea drinkers instead of green tea(Statista, 2018). That is why introducing green tea in U.K could be a fail.

Sales value of tea in the United Kingdom (UK) in 2015, by category (in million GBP)

(Source: (Statista, 2018)

The country is not inclined towards health beneficial products; this can be said due to high obesity rate of the country. One in five children in was obese or overweight. In addition, £42.43 is an average spends per person, per week on food and drink(finder, 2018). That is why not entering into U.K market for green tea is right decision for Coca-Cola.
When health statistics is considered, the people of European countries are more inclined towards other drinks and alcohol consumption is very much in U.K. 57%: of the UK population drink alcohol; this states that healthy drink like green tea would not be preferred (finder, 2018).

(Source: (finder, 2018)

61% of British people like or prefer to take coffee instead of green tea according to a survey conducted by Syrup makers ‘Monin'(Scott, 2017). Therefore, introducing green tea in U.K market would not be a better decision.

Cultural difference in china and United Kingdom

China culture includes a better and healthy lifestyle, due which consumption of green tea is much more; it is a developing country with combination of westernized lifestyle and old world traditions(elements.science.psu.edu, 2018). while
United Kingdom culture is more inclined towards western culture, as the country is a developed country, use of technology is very high, and lifestyle adopted is luxurious. Where the variety of products to offer customers is much more in every aspect, whether shopping options, beverage option or anything else are very much, consumption of a healthy beverage like green tea is quite low(Greig, 2015).   

Cai, M. (2018). The Characteristics of Chinese and Westerners—From the Comparison of Tea and Coffee Culture. Lecture Notes on Language and Literature, 10-16.
Chaffee, J. (2017). Tea in China: A Religious and Cultural History by James A. Benn, and: The Rise of Tea Culture in China: The Invention of the Individual by Bret Hinsch. Harvard Journal of Asiatic Studies, 493-502.
elements.science.psu.edu. (2018). Chinese Culture, Tradition, and Customs . Retrieved from elements.science.psu.edu: https://elements.science.psu.edu/psu-pku/student-resources/resources-for-penn-state-students/chinese-culture-tradition-and-customs
financialexpress. (2018). Strong demand in China, India boost tea consumption and production. Retrieved from financialexpress: https://www.financialexpress.com/industry/strong-demand-in-china-india-boost-tea-consumption-and-production/1184588/
finder. (2018). Health Statistics. Retrieved from finder: https://www.finder.com/uk/health-statistics
Greig, H. (2015). Gender and material culture in Britain since 1600. . Macmillan International Higher Education.
Scott, E. (2017, 09 29). Treasonous British people now prefer coffee to tea. Retrieved from Metro: https://metro.co.uk/2017/09/29/treasonous-british-people-now-prefer-coffee-to-tea-6965063/
Statista. (2018). Sales value of tea in the United Kingdom (UK) in 2015, by category (in million GBP). Retrieved from Statista: https://www.statista.com/statistics/382133/tea-market-sales-value-united-kingdom-uk-by-category/
statista. (2018). Tea China. Retrieved from statista: https://www.statista.com/outlook/30020000/117/tea/china#market-globalRevenue

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