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----Esther Chin Yee Cheng, Tan Sin Yee,
Sfudentname Kieu Ke Wen, Lim Su Yi SfudentlD number s4664105,s4664088,s4664134,s46641 15

Unit of Srudy BHO3373:INTERNATIONAL MARKETING

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 BHO 3373
International Marketing
Marketing Plan
For

“BOH PLANTATIONS SDN BHD”

Prepared by Group B2
Esther Chin Yee Cheng s4664105
Tan Sin Yee s4664088
Kieu Ke Wen s4664134
Lim Su Yi s4664115
Executive summary

This report is to propose a marketing plan for BOH Plantations Sdn Bhd (BOH) to
export its Black tea to New South Wales (NSW), Australia. Australia has been chosen
as the host country due to its cultures and habits among their people. Our finding
shows a positive result in exporting the product into Australians market. Throughout
the finding, several competitors have been identified with the major one, Nerada Tea,
largest tea manufacturer in Australia.

Hofstede’s cultural dimensions has been applied to analyse the cultural differences
between both countries. Whereas the analysis of Country-of-Origin (CoO) shows that
product manufactured from Malaysia holds a perception of higher reliability with certi-
fication like Halal-certified, MeSTI. In Australia, consumer ethnocentrism can be
shown at a lower level, and they are found to have no animosity towards Malaysia
products.

BOH is suggested to target people who are categorised under prime working age (25-
54 years old) in NSW as they are the largest population that consumed black tea.
Moreover, exportation using ocean freight is also suggested to the company as it is
more cost-effective and eco-friendlier. The main focus on the 5 years will be expanding
to other states of Australia. Next, advertising advice has also been provided to tackle
the issue on Country-of-Origin. Pricing BOH tea using flexible cost-plus strategy which

ease the company for price adjusting.

 Table of Contents
Page
Executive summary
1.0 Introduction ........................................................................................................ 1
1.1 Company Background .......................................................................................... 1
1.2 Product Portfolio ................................................................................................... 1

2.0 Description and Justification for Country Recommendation ......................... 1

2.1 Political ................................................................................................................. 2
2.2 Economic ............................................................................................................. 2
2.3 Social ................................................................................................................... 2
2.4 Technological ....................................................................................................... 2
2.5 Environmental ...................................................................................................... 3
2.6 Legal .................................................................................................................... 3

3.0 Competitor Analysis .......................................................................................... 3

3.1 Competitor & Industry Grown ............................................................................... 3
3.2 Porter’s Five Forces ............................................................................................. 4

4.0 Cultural Profile.................................................................................................... 5

4.1 Hofstede's Five Dimensions Comparison between Australia and Malaysia ......... 5
4.1.1 Power Distance ................................................................................................. 5
4.1.2 Masculinity / Femininity ..................................................................................... 5
4.1.3 Indulgence / Restraint ....................................................................................... 6
4.2 Country-of-Origin .................................................................................................. 6
4.3 Consumer Ethnocentrism ..................................................................................... 6
4.4 Consumer Affinity ................................................................................................. 6

5.0 Market Segmentation, Target Marketing, Positioning ..................................... 7

5.1 Market Segmentation ........................................................................................... 7
5.1.1 Demographic Segmentation .............................................................................. 7
5.1.2 Psychographic Segmentation ............................................................................ 7
5.1.3 Geographic Segmentation ................................................................................. 7
5.2 Target Market ....................................................................................................... 8

i
5.3 Positioning ............................................................................................................ 8

6.0 Market Entry and Expansion ............................................................................. 8

6.1 Market Expansion for The Next Five Years .......................................................... 8

7.0 Recommendations ............................................................................................. 9

7.1 Positioning ............................................................................................................ 9
7.2 Country-of-Origin (CoO) & Consumer Ethnocentrism .......................................... 9
7.3 Product Modification ............................................................................................. 9
7.4 Price ..................................................................................................................... 9
7.5 Promotion ........................................................................................................... 10
7.6 Place .................................................................................................................. 10

References

Appendices
Appendix 1: BOH Cameronian Gold Blend
Appendix 2: BOH’s Garden Tea Series
Appendix 3: Revenue of tea market in Australia
Appendix 4: Income level of Australia
Appendix 5: Exchange currency rate AUD to MYR
Appendix 6: The price of Nerada tea bags 200pack
Appendix 7: The price of Lipton Yellow label Tea Bag in MYR
Appendix 8: Distance from BOH Tea Centre to Port Klang
Appendix 9: Estimated arrival time and price of ocean freight from Port Klang to Port
Sydney
Appendix 10: Average amount of Millennials and Generation X spending time in social
media

ii
1.0 Introduction

1.1 Company Background

BOH Tea Plantations Sdn Bhd (BOH) is Malaysia’s largest black tea manufacturer and
market leader with exportation to the United States, Denmark, Germany, South Korea,
Taiwan, Japan, Singapore, and Brunei. BOH’s vision of improving community engage-
ment and drive social responsibility via our sustainability initiatives, align with their
company’s mission to achieve more than just creating great tea, but to also enable
great tea experiences while helping customers achieve a fresh perspective (BOH
Plantations Sdn Bhd 2022).

1.2 Product Portfolio

There are around 50 types of products ranging from ice tea mix, black tea, flavoured
tea, single origin, herbs and fruits, green tea and instant tea mix (Boh Plantations Sdn
Bhd 2022). Hereby, black tea in BOH is suggested to be exported into Australian mar-
ket. Therefore, BOH Cameronian Gold Blend and Garden Tea Range namely Palas
afternoon tea, Gunung Cantik, Palas Supreme, and Bukit Cheeding No.53, the best
two sellers' premium black tea will be decided to export to Australia, NSW (Appendix
1&2).

2.0 Description and Justification for Country Recommendation

BOH Cameronian Gold Blend and Garden Tea Range is suggested to export to Aus-
tralia because Australia’s tea revenue increased from US$0.94billion in 2020 to
US$1.26billion in 2022. Refer to appendix 3, the tea market expected to grow in Aus-
tralia by 2.61% (CAGR 2023-2025) and the tea segment revenue are expected to
achieve US$1.40billion in 2023 (Statista 2022) so BOH can achieve greater value in
new foreign market as Australia raising demand for black tea.

Additionally, Australians and Malaysians have similar tea drinking traditions, as Aus-
tralians believe that tea is a big part of their culture, owing to its British origins from
colonisation and Malaysians seeing tea as a staple on the beverage menu at all coffee
shops (KUONI 2021).

The Australian Tea Cultural Society (AUSTCS) is also established to promote tea cul-
ture in Australia, in contrast Malaysia has Malaysia Tea Association (MYTA) since

1
2022 (Malaysia Tea Association 2023). Besides, Australia also celebrates tea festival
on 21st May in conjunction with the international tea day (Australian Tea Cultural So-
ciety 2023).

2.1 Political

The Kuala Lumpur-signed Malaysia-Australia Free Trade Agreement (MAFTA) which

means the enforcement, commodities from Malaysia sent to Australia paid with no tax-
and duty-free entry help to reduces trade barriers (Ministry of International Trade and
Industry 2012; Australian Government Department of Foreign Affairs and Trade n.d.).

2.2 Economic

Australia’s GDP is predicted to reach $1571.00 billion USD by the end of 2023 (Trad-
ing Economics 2022). Australian Bureau of Statistics (2021) showed that from 2020–
2021 and 2021–2022, the gross disposable income per household in Australia in-
crease 3.7%, reaching $139,064 and final consumption expenditure (FCE) per house-
hold grew 5.9% to $104,514 (Appendix 4). Australia is also a major importer of con-
sumer goods, and it is one of the world's wealthiest countries with vibrant economy
(Observatory of Economic Complexity 2022).

2.3 Social

According to Statista (2022), Australia total population is 25.77 million. Besides, Aus-
tralian Bureau of Statistics (2022) stated that resident in NSW had achieved 8.1 million
in 2021.Therefore, there are 47.6% of Australians consume tea (Roy Morgan 2019).
Hence, Bolton (2019) stated that, black tea in bags is the most popular teas among
Australian and they believe that drinks tea can bring various of benefits to them.

2.4 Technological

Australia has a high level of internet penetration and well-developed information tech-
nology. CEDA (2022) claimed that investing in telecommunications can help the coun-
try rise to NO.14 in the IMD World Digital Competitiveness Index (WDCR). Moreover,
government is making investments in cutting-edge technologies like blockchain, AI,
and the Internet of Things (Pistilli 2022). On top of that, almost 80% of Australians are
already covered by Telstra's 5G network (Choros 2022).

2
2.5 Environmental

According to Wolf et al. (2022), Australia ranked 17 in the latest Environmental Per-
formance Index (EPI) in 2022 and reform its regulation of packaging requirements in
2022 as the packaging of the product reach 100% reusable, recyclable, or biodegrada-
ble by 2025 (Department of Climate Change, Energy, the Environment and Water
DCCEEW 2022; Global Australia n.d.).

2.6 Legal

To import products into Australia, importers are not required to have an import license.
However, importers need to seek licences to clear some imported commodities from
customs control, depending on the nature of the items and value (Australian Border
Force 2020). A major piece of law that governs work in the nation is the Fair Work Act
of 2009 (Australian Government 2009).

3.0 Competitor Analysis

3.1 Competitor & Industry Grown

Ahmad Tea, Cameron Valley Tea and Lipton are the competitors for BOH in Malaysia
(Suloshna 2022). Lipton, the world’s leading tea brand is main competitors competing
with BOH in Malaysia (Lipton 2023). Lipton has more than nine series of tea ranging
from black tea, herbal tea and others (Ekaterra 2023).

Alternately, Tetley, Twinings and Delma are the competitors for BOH in Australian
market. However, the main competitor for BOH is Nerada, which is the world's biggest
tea producer from Australia with 9% of market share (Nerada Tea 2023). Its product
line has been increasing from 5 items to 85 in 15 years with the expanding from black
tea to variety of infusions. According to Canstar Blue Pty Ltd (2023), Nerada “Single
Origin Black Tea” has been recognised as best-rated No.1 black tea by all Australians
(Nerada Tea 2023a).

Additionally, the price range of black tea among BOH’s competitors in Australia, Ne-
rada is AUD 6 (MYR 17.90) (Appendix 5 & 6) while in Malaysia, Lipton is priced at
MYR 14.20 (Appendix 7) Based on Statista (2022), the tea segment will generate
$2.70 billion in revenue. The market is anticipated to expand by 3.92% yearly (CAGR
2023-2025) and the revenue in tea market for the host country has increased from

3
2020 USD 0.94 billion to 2022 USD1.26 billion. Aside from this, the revenue of tea
market is expected to increase to USD 1.47 billion in 2025.

3.2 Porter’s Five Forces

(Sethuraman & Basariya 2019; Wong, Chang & Yeh 2019; CFI 2022; Bolton 2019)

Firstly, the threat of new entrants is low. According to Desai, Eklund and Lappi
(2020), who want to enter a foreign market that have comply regulations can be easy
to enter Australia. Thus, promotions are important to increase the brand awareness
and reputation in host countries (Chierici et al. 2018). Next, the bargaining power of
consumer is high, because of there is a wide range of tea brands in Australian mar-
ket, this led the switching cost of the consumer to become low and switch brand easily
(Zona 2019; Wu 2019).

Besides, Sethuraman & Basariya (2019) claims that consumer’s tea preference is
changing easily this makes the threat of substitute products higher. Furthermore,
the bargaining power of supplier is low due to there is a great number of tea supplier
and production in Australia, so it is easier for substitution (Gunarathne et al. 2022).
Lastly, the competitive rivalry is high because tea segment is growing rapidly due
to consumer’s preferences switch to healthier products, thus the demand of tea will be
increased (Risbud 2021).

4
4.0 Cultural Profile

4.1 Hofstede's Five Dimensions Comparison between Australia and Malaysia

(Hofstede Insights 2022)

4.1.1 Power Distance

The extent to which the less powerful members of institutions and organisations within
a nation expect and accept that power is allocated unequally is described as power
distance (PDI) (Alqarni 2022). It is divided into high-power-distance and low-power-
distance (Hofstede 2011). Malaysia achieved a score of 100 on this power distance
dimension, which means that Malaysians have a great deal of respect for this in au-
thority. Confucian ideas that underpin these civilizations give rise to the notion that
elderly people are treated with greater respect in eastern cultures (Vauclair et. al
2016). Whereas the Australia scores low on this dimension 36. In Australian work-
places, communication is also casual, direct, and participatory (Ghosh 2011).

4.1.2 Masculinity / Femininity

The term "masculinity" refers to the roles, actions, and qualities that are seen to be
suitable for boys and men in a certain society (Beugelsdijk & Welzel 2018). Australia
is seen as a "Masculine" society and receives a score of 61. The common beliefs that
one should "strive to be the best one can be" behaviour in all settings. Australians take
great pride in their accomplishments, and this provides a foundation for decisions on
hiring and promotions at work (Connor et al. 2021). However, for Malaysia with an
intermediate score of 50, a presence for this dimension cannot be determined.

5
4.1.3 Indulgence / Restraint

The degree to which people attempt to regulate their desires and impulses which can
be classified as indulgent and restraint (CFI 2022). For indulgent societies, they are
generally willing to express their impulses and desires about enjoying life. Asides, re-
straint societies are suppressing their desires and impulses and regulates by strict
norm, so they are less positive emotion. (Kalé, Harland & Moores 2020).

Moreover, Australia and Malaysia both are share the same culture as they are indul-
gence societies scored of 71 and 57 (Hofstede Insights 2022). This kind of society
focus on their own happiness and well-being, and they value leisure time, freedom
and personal control (Kalé, Harland & Moores 2020). This reflects that Australians and
Malaysians more on enjoy their life in drinking tea as they value leisure time.

4.2 Country-of-Origin

The Country-of-Origin image influenced consumers perceptions towards a product

(Cheah, Phau & Aiello 2017). For BOH’s product, Malaysia’s reputation can be high-
lighted in marketing activities to tackle consumers’ buying decision. Also, the company
adhered with standards including FSSC22000, MeSTI, myGAP certification, and
Halal-certified that can fulfil consumer preference Muslims in Australia (BOH Planta-
tions Sdn Bhd 2020).

4.3 Consumer Ethnocentrism

Consumer ethnocentrism is a result of people's pride in their homeland and concern

that buying foreign goods would hurt their economy (Cheah & Shimul 2018). Based
on Cheah and Shimul (2018), Australians is low levels of ethnocentrism, which is a
result of the nation's dependency on imported goods. Thus, this means that their pur-
chasing pattern will be more opened to foreign products (Acharya & Elliott 2003).

4.4 Consumer Affinity

Affinity, as a people's feelings characteristic significant in predicting purchase behav-

iour because it can affect customer satisfaction and loyalty (Serrano-Arcos 2022).
BOH’s product can fulfil consumer’s habit as tea consumers in Australia drink “morning
and afternoon tea” despite hot or cold weather (Lawson 2017). There is no animosity
observed from Australians towards product imported from Malaysia as foreign rela-
tions exists between both countries (Australian Government n.d).

6
5.0 Market Segmentation, Target Marketing, Positioning

5.1 Market Segmentation

BOH may divide the market into several segments depending on demographics, psy-
chographics and geographic segmentation.

5.1.1 Demographic Segmentation

Australians are classified by age as 0-14 (children),15-24 (early working age), 25-54
(prime working age), 55-64 (mature working age) and 65 and over (elderly) (In-
dexMundi 2017). Based on Jocelyn (2021), Australia’s prime working age are the larg-
est population that consumed tea with 67.8%. People in this age can be categorised
as Millennials and Generation X (Australian Bureau of Statistics 2022). According to
Australian Bureau of Statistics (2022), there are 65.4% of millennials considered as
high earners and 52.2% of Generation X. Therefore, BOH will be targeting those prime
working age between 25-54 years old.

5.1.2 Psychographic Segmentation

Risbud (2021) noted that maintaining health is a key priority for 80% of Australians.
Besides, Australians prefer natural components in meals and their beverage selec-
tions (Molenaar et.al 2020). Australians are more environmentally conscious as nearly
88% of Australians have reduced their environmental impact (Wallis 2022). Research
shown that environmentally friendly goods will impact consumer’s buying intention
(Grimmer, Kilburn & Miles 2016).

5.1.3 Geographic Segmentation

NSW the largest state economy in Australia with one-third of the country's economic
output (NSW Government 2021). Furthermore, Walsh (2022) stated that the political
and regulatory environment of NSW is relatively stable which makes NSW an attrac-
tive place for business. Moreover, the NSW’s cost of living was the highest in the na-
tion at $275.41 per week compared to other states (Budget Direct 2019). The popula-
tion of NSW is the highest in Australia with 10.57 million (NSW Environment Protection
Authority 2021).

7
5.2 Target Market

The main target market for BOH in Australian market will be prime working age that
around 25-54 years old, as the largest population that consumed black tea (Australian
Bureau of Statistics 2022). Besides, BOH will also target consumers with health and
environmental concerns. In 2021, their weekly personal income is USD 1527 in aver-
age which AUS 122 spending on food and beverage (Australian Government 2016).

5.3 Positioning

BOH positioned itself as high quality with affordable price in Malaysian’s mind (BOH
Plantations Sdn Bhd 2020). Therefore, BOH will position differently as high quality with
high price in foreign country by providing premium tea. Factors such as packaging,
brand reputation and social image will influence consumer purchasing decision (Ali
and Ramya 2016). As a result, the packaging in BOH tea for export may attract con-
sumer's attention by artistic packaging (Appendix 2). The positioning strategies that
will be used is Foreign Consumer Culture Positioning (FCCP), where the brand will
connect with the foreign consumer culture (Teng et al. 2022).

6.0 Market Entry and Expansion

BOH will export BOH Cameronian Gold Blend and Garden Tea Range to NSW. Ocean
freight will used for exportation from Malaysia to Australia. Hence, the products will be
delivered using trucks from BOH Tea Center, Pahang to Port Klang, Selangor anda-
bout 4 hours and 12 minutes (239.3km) to arrive at Port Klang (Google Maps 2023)
(Appendix 8). The cargo ship of MAERSK will be departed from Port Klang to Port
Sydney, Australia in 33 days with the distance 9280.37km (SeaRates 2023) (Appendix
9). Based on Tejada (2022), using Ocean freight is more eco-friendly and more cost-
effective. Moreover, as Woolworths has their owned transports fleet, they can do self-
picked up at Port Sydney and distribute the products to all the branches in NSW (Du
2022).

6.1 Market Expansion for The Next Five Years

In the next five years, BOH might expand their market in other cities such as Victoria
and Queensland of Australia to utilise the wide-ranging distribution network of Wool-
worths. Moreover, BOH may also adopt geographical expansion strategy by analysing

8
population, market size, income level and competitors of the new locations (Le 2021).
Besides, market penetration strategy to increase their market share.

7.0 Recommendations

7.1 Positioning

BOH has a product differentiation strategy with its unique selling points of using recy-
clable material called Polypropylene (PP), which is classified as recyclable under Code
No. 5 for their Pot bag pouches as well as switched their pot bag filter by using biode-
gradable materials (BOH Plantations Sdn Bhd 2021). Besides, each BOH’s tins
(Graden Tea Range) is also specially designed in collaboration with Kakiseni, Art or-
ganisation of Kuala Lumpur (BOH Plantations Sdn Bhd 2019).

7.2 Country-of-Origin (CoO) & Consumer Ethnocentrism

For BOH, Malaysia’ good reputation can be highlighted in marketing activities to tackle
the new consumers’ mind. Also, the corporation should think about promoting product
origin to lessen buyer animosity (Moon & Oh 2017). CoO may be threatened by con-
sumer ethnocentrism since it reduces the positive influence of value equity on con-
sumer purchase intentions (Cheah & Shimul 2018) which then BOH might consider a
different way to enhance their purchase intention by advertising its product origin
through social media.

7.3 Product Modification

The labelling on BOH’s product is in English version. According to The Department of

Home Affairs (2022), English is Australia’s national language. NSW Department of
Education (2021) stated that, 76% of Australians speak English. Therefore, the label-
ling of BOH can be understand easily by the target market without any language bar-
riers.

7.4 Price

BOH should use flexible cost-plus strategy to determine the selling price in Australia
to build the market and customers developed. The selling price of BOH Cameronian
Gold Blend and Garden Tea Range in Malaysia is RM 13.40 (AUS 4.4) with 60 teabag
sachets and RM30 (AUS 9.9) with 15 pyramid teabags. In Australia, the selling price
for BOH Cameronian Gold Blend will slightly higher than the competitor as AUS 6

9
which means AUS0.10 per teabag while garden tea Garden Tea Range will set as
AUS 11.9 which means AUS 0.79 per teabag. Based on Australian Government
(2016), personal income and spending for our target market are affordable for the sell-
ing price that set by BOH.

7.5 Promotion

According to Dixon (2022), Australian Millennial and Generation X spent 2.25 hours
and 1.5 hours per day on social media (Appendix 10). Facebook (77.7%) and YouTube
(78.2%) are tied as Australia's most popular social media sites (Ramshaw 2022). The
best time to advertise on Facebook and YouTube to reach our target customers is
between 6-9pm (Lindsay 2023). Moreover, increase customer awareness through in-
store sampling to further educate consumers about the uniqueness of the items (Heil-
man, Lakishyk & Radas 2011). Therefore, these two promotional tools will be sug-
gested to the distributors, Woolworths to reach the target customers.

7.6 Place

Boh can minimise the cost for distribution as Woolworths has its supply chain system.
Wahyuni (2010) noted that Woolworths has a national distribution Centre (NDCs) lo-
cated in Yennora, city in NSW. Therefore, BOH product will go through their Transport
Management System (TMS) collect from port Sydney and stock in their NDCs and
which will then later be distributed throughout 329 branches of Woolworths in NSW to
reach out to consumers (ScrapeHero 2022).

Wordcourt：2748 words

10
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APPENDICES
Appendix 1: BOH Cameronian Gold Blend

(BOH Plantations Sdn Bhd 2022)

Appendix 2: BOH’s Garden Tea Series

(BOH Plantations Sdn Bhd 2022)

Appendix 3: Revenue of tea market in Australia

(Statista 2022)

Appendix 4: Income level of Australia

(Australian Bureau of Statistics 2021)

Appendix 5: Exchange currency rate AUD to MYR

(Google Finance 2023)

Appendix 6: The price of Nerada tea bags 200pack

(Woolworths 2023)
Appendix 7: The price of Lipton Yellow label Tea Bag in MYR

(Green Home Marketing 2019)

Appendix 8: Distance from BOH Tea Centre to Port Klang

(Google Maps 2023)

Appendix 9: Estimated arrival time and price of ocean freight from Port Klang to
Port Sydney

(SeaRates 2023)

Appendix 10: Average amount of Millennials and Generation X spending time in

social media

(Dixon 2022)