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Bottled green tea strategy wows the judges at 42nd WMS Case Competition

06 October 2017

Team 'Settlers of Catan', pictured with Zealong's general manager Gigi Crawford (centre) and international marketing manager Sen Kong.

The tea industry is on the cusp of a global renaissance, and Zealong Tea Estate is keen to grow international demand for their award-winning range of organic, luxury teas.

Launching a new range of bottled tea drinks in China aimed at health-conscious millennials could be the answer, according to a group of Waikato Management School students.

Thanks to their ‘perfect brew’ of ideas for Zealong’s future business growth, the ‘Settlers of Catan’ team were named winners of the 42nd Waikato Management School Case Competition, held on 4 October. They took home a $2,500 cheque, courtesy of the event’s longtime sponsor PWC.

The third-year strategic management students impressed the judges with their low-risk, easy-to-implement strategy, which would generate an estimated $13.9 million in profits for Zealong by 2022.

The judges liked the idea of an e-commerce subscription service for Zealong bottled teas – sold via Weibo and Wei-Chat - as it would add value to the existing product, create more predictable demand, and reduce any warehousing costs.

“There are around 400 million millennials living in China today, and we’d only need to sign up 12,500 weekly subscribers to make our strategy work,” explained team member XXx.

“Many young people in China are living at home for longer, so they have more disposable income than their parents.”

“Zealong is the only tea producer in New Zealand – not to mention being 100% organically certified by BioGro - and we have a global reputation for being clean and green, so we feel that’s a really strong USP in the bottled tea market.”

This premium product would also increase revenue from $630 per kg of raw organic tea at present to around $1,260 per kg within five years.

The students planned to raise brand awareness for Zealong bottled tea by promoting it through key social media, such as Papi, a food blogger who has 18.6 million followers in China; and the Diary of Daily Eating, an organic blog that has 10 million followers.

The Waikato Management School Case Competition has been held twice a year since 1996, and it is the culmination of a third-year strategic management paper called STMGT391.

This practical paper is regarded as a highlight of the four-year Bachelor of Management Studies with Honours degree.

Course convenor Dr Kathryn Pavlovich says the competition helps to prepare students for a business career by giving them a case study of a real New Zealand company to work on.

Students are given only two weeks to develop a strategy, conduct industry research, write a business report, and then present their strategy for judging. The four top teams go through to the finals of the competition.

The competition brought back memories for Sen Kong, international marketing manager for Zealong, who completed the paper STMGT391 in 2009, as part of his management degree. He then graduated from a Master of Management Studies in Marketing, with first class honours, in 2013.

 

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