c

Internal Factor Evaluation (IFE) matrix for Lipton Yellow Label

Internal Factor Evaluation matrix is a strategic management tool for auditing or
evaluating major strengths and weaknesses in functional areas of a business. IFE matrix
also provides a basis for identifying and evaluating relationships among those areas. The

 



  or short IFE matrix is used in strategy formulation. IFE
shows major internal strengths and weaknesses for the company and highlights its core
competencies on which strategy is going to be formulated. In case of Lipton, we
highlighted Unilever͛s major strengths such as, product quality, distribution channel,
marketing and advertisement, market share, customer loyalty, human capital,
technology and revenue growth. As far as weaknesses are concerned we came up with
price competitiveness, market development, tea bag market as major weaknesses. We
assigned weight and rating to each factor and according to its importance to come up
with weighted score for each factor.

Ôey Internal Factors c c c c


 c   c
 c    
c

Grand Awareness c 0.08 c 3c 0.24 c

Product Quality c 0.07 c 3c 0.21 c

Distribution c 0.09 c 3c 0.27 c

Marketing c 0.08 c 3c 0.24 c

Market Share c 0.10 c 3c 0.3 c

Customer Loyalty c 0.09 c 4c 0.36 c

Human Capital c 0.05 c 4c 0.2 c

Technology c 0.04 c 3c 0.12 c

Revenue Growth c 0.01 c 4c 0.4 c

c c c c

Price Competitive c 0.1 c 2c 0.2 c

Market Development c 0.08 c 1c 0.08 c

Tea Gag Segment c 0.07 c 2c 0.14 c

Perception Nutritional Value c 0.05 c 1c 0.05 c

 c 1c c 2.81 c
trategy Deployment for Lipton Yellow Label
To identify the strategy Lipton Unilever is deploying, we need to find out the target
market for Lipton. Targeting a segment means the company is making a selection and
targeting a certain group of consumers or buyers for its product or services. Evaluation
of different segments that companies make is most critical before targeting any
segment, every company have its own criteria of selecting a segment such as size,
potentiality of growth, profitability, economies of scale, or low risk in the segment.
Lipton Yellow Label has target different market segments.

Lipton Yellow Label basically has targeted the urban areas and has concentrated on the
upper and middle classes. Therefore despite the fact that it uses a mass marketing
approach it can easily be denoted that this product is catered to a particular segment.
Even in its marketing approach for Lipton Yellow Label, the product is presented in a
different way for instance the teabags are targeted toward the upper high class, while
soft packs and jar packs are targeted for middle and middle lower class. Today as both
men and women consume equal amounts of tea the age group segment selected for
Lipton is for all age group for they want to target those people who are young, trendy,
and cosmopolitan.

In our opinion, Lipton yellow label has deployed Product Development Strategy in which
the company is trying to come up new variants for its product and trying to increase its
market share. Since the tea industry is already in maturity stage, hence it attracts
satisfied consumers with improved products. Lipton offers various tea variants, such as
green tea, mint green tea, lemon green tea & jasmine tea. Due to major competitors in
the market which are offering comparable quality tea in similar price, product
development strategy for Lipton Yellow Label seems very appropriate. Since there is
minimal difference between product quality, taste and price, the only way Unilever can
overcome its competitors is to develop new variants for its current product through its
research and development.

Tea industry is considered as high growth industry and Unilever having strong research
and development capabilities, reinforces its Product Development Strategy.Lipton is also
focusing on nutritional value of tea and making people aware of its healthy and
nutritional factors through research and development.