Financial Times - Ceylon to Sri Lankan tea, champagne to fizzy wine?

Moves are underway to change the brand Ceylon tea to Sri Lankan tea, while ensuring intellectual property rights cover both, according to government officials but the industry has expressed concern over the cost and market-losing potential of such a move.

J. Abeywickrema, Secretary at the Ministry of Plantation Industries, said it was the right time to change the name, “but it’s not something that is going to happen overnight”.

The move was echoed by H. D. Hemarathne, Director-General of the Sri Lanka Tea Board. “The name of the country changed in 1972 and both are now equally known. The name Ceylon tea is world renown and to make such a change will not be done immediately as it will take time to let people know that one is the same as the other, and for this we must get intellectual property rights for Ceylon tea.”

The issue came to the fore recently when President Mahinda Rajapaksa, while presenting ISO certification to Ceylon Royal Teas Co at a ceremony at Temple Trees, suggested that the brand name of the country’s biggest commodity export should be “Sri Lankan Tea” instead of “Ceylon Tea.”

The problem however, according to Chrisantha Perera, a veteran tea industry specialist now retired is that “if you change the name you will be destroying one of the most successful brand names in the world, together with the lion logo.” “When the decision was made to change the country’s name to Sri Lanka, the then-government decided to keep the Ceylon tea brand name and the lion for obvious reasons. It’s a very powerful name,” he said.

Malik Fernando, Director of Operations at Dilmah, also had his doubts: “Millions have been spent on promoting Ceylon tea since the 1920s and the brand is so well known. Changing the name would cost a fortune in re-branding. If that money was available, maybe it would be a good idea, but it isn’t.”

The Ministry Secretary backed up the move by saying these days tea produced in Sri Lanka was of a very high class, where value-added tea could be used for the change over a period of time.

“There is also a lot of illegal use concerning the Ceylon name, especially in the Middle East, where high quality is mixed with lower quality leaves and this needs to be stopped; and I think the name change will not lose that much of a market due to Sri Lanka being so well known,”

Tyeab Akbarally, President, Tea Traders Association, said such comments were not the first of that kind to be heard over the years.

“At present there has been no discussion within the industry as a whole, but we are meeting on Thursday to discuss the matter,” he said. As for a change in the name, “Personally I don’t really mind either way as it’s the lion logo that stands prominent,” Akbarally said.

Mohan Mendis, Chairman, Export Association of Sri Lanka, was surprised by the idea as it was not just tea that was branded that way, but cinnamon and sapphires as well. “Plus, the name is so well known. It’s up there with champagne, and I can’t see that being changing,” he said.

Concerning comments that the Ceylon name was used by another country, Mendis said specialist advisors employed for the purpose of Geographical Identification, which is a long drawn-out process, said that the only worry could come from a town in the US called Ceylon.

“As far as we know it’s the only problem encountered and the feeling is that it’s not insurmountable. The name Ceylon tea has never been properly registered, but I would think that as it would be difficult to get rights over the previous name of a sovereign country,” he said.

The trademark lion pictured on packaging is registered.

Dilmah’s Fernando said: “If the name was changed to Sri Lanka, it wouldn’t be known in the Middle East, a big market, or in other traditional markets. We would lose several generations of teas drinkers who know the name as a very good tea. In the western markets, the name Ceylon offers a positive feeling to tea drinkers.”

Perera agreed: “The name Ceylon and the lion have been used on world brands everywhere. People have been educated on that fact. One of the most famous teas in the world is South Africa’s Five Star, and one of those stars is of Ceylon tea. It is such a negative step. The money needed for the change, enormous. If they want to incorporate Sri Lanka in the name; why not keep Ceylon tea and promote the fact that it comes from Sri Lanka?”

What most seemed to agree on is the IP protection for the brand. “The process is being looked at to protect the names, where legislation is being looked at now, said Hemarathne, the Sri Lanka Tea Board Director-General.

Another factor was the different perception of the two names. According to Akbarally, “as for the name Sri Lanka not being as well known as Ceylon, I would have agreed if it hadn’t been for the tsunami, which definitely put the country on the map, if not exactly in a positive way,” he said.

There was also the matter of image. Mendis and Fernando both said that presently there was a negative one as far as the country goes because of the civil war, and now the increase in violence after four years of relative calm. Mendis said that there was the positive image of the cricket, and even the bronze medal won in the last Olympics, but the negative prevails around the world when they think of Sri Lanka.

“It just doesn’t make sense to change now,” Fernando added.

On the price of re-branding, Akbarally admitted that the cost would be huge and at the moment that sort of money was not available. “In fact, our balance is more on the negative side,” he said.

And for those who market and sell the tea abroad, this is what Nalin Wijesekera, President of the Canadian-based Ceylon Tea Company Ltd said: “We sell pure Ceylon tea in its original format without blending, thus letting the Canadian consumer become aware of true taste of this premium tea produced in Sri Lanka. I do believe the Sri Lanka Tea Board sells tea as ‘Pure Ceylon Tea’ which should be the case as Sri Lanka tea is world renowned for being good. Do we want to change this?” he said.

“At the moment we are losing our share in the North American market as it is and changing the name will only make it worse,” Wijesekera concluded. (RI)