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Strategy Briefing

Global Tea: Consumer Trends Converge Around Brewed Beverages

Nov 2016

US$1,325

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About This Report

New Report Guarantee

If you purchase a report that is updated in the next 60 days, we will send you the new edition and data extract FREE!

This report considers opportunities for global tea, including hot tea and RTD tea. Combined, tea is the most consumed global beverage in terms of volume. There is growing evidence of value creation in tea, as consumer demand for healthier and natural beverages leads them to opt for versatile tea-based brewed beverages across consumption occasions.

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Overview

Why buy this report?

Gain competitive intelligence about market leaders. Track key industry trends, opportunities and threats. Inform your marketing, brand, strategy and market development, sales and supply functions.

Tea is the most dynamic category in global beverages

Tea is a volume and value growth opportunity in beverages, thanks to its ubiquity in the largest global beverages markets and its versatility as a product – consumed hot or cold, sweet or unsweetened, and as a healthy or indulgent beverage.

Tea has entered an era of value creation

Tea has entered an era of value creation. It has long been considered a low priced commodity (in contrast to coffee and packaged soft drinks), but growth in chilled RTD tea is driving value growth, alongside growth in hot green teas and premium speciality black teas.

RTD tea is growing as a BFY option and taking share from carbonates

RTD tea has emerged as a better-for-you soft drinks option, consumed for its refreshment, hydration and functional (natural energy) benefits. The US has been a major area of growth, thanks to premium priced single serve teas. Healthier RTD teas are a growth opportunity in China. Flavourful brewed RTD teas are also an area of substantial NPD targeting young consumers.

Hot tea must focus on retaining younger consumers

Hot tea is second only to bottled water in terms of global consumption. Value sales potential is finally being realised with functional, healthier and flavourful tea blends. Maintaining loyalty among young people (who represent a sizeable portion of the population in the highest per capita tea markets) is crucial.

Outside the off-trade there is strong growth in foodservice tea and alternative tea products

Tea is finding ways to develop in non-traditional forms and channels outside the home. Alcoholic drinks and home tea appliances are two opportunities. In addition, chained tea concepts in India, the UAE and other markets are finding success, while tea in US/European foodservice is dependent on entering the menus of mixed operators – from coffee chains to fast food.

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Introduction

Scope

Definitions

Tea: The US$20 Billion Opportunity

Key findings

Tea intersects with the major consumer drivers of food and drinks

Tea is the most consumed beverage on the planet

Versatility of tea creates opportunities across occasions

An era of value creation in tea

Value creation: Price-led growth in tea

Value creation is happening in emerging and developed markets

The US$20 billion opportunity for tea

The Wider Universe of Tea

A wider universe of opportunity for the category

Tea in foodservice: Undeveloped promise

Creating mainstream, affordable tea chains to grow appeal

Demand for craft creates opportunity for tea appliances in the home

Tea has niche opportunities in cocktails and RTD alcoholic drinks

Consumer Segmentation in RTD Tea

RTD tea opportunity in summary

What factors drive RTD tea growth?

Markets to watch: RTD tea category growth through 2020

Turkey: Growth in BFY tea and carbonate replacements

Southeast Asia: Local tea brands establish category leadership

The American RTD tea consumer is going upscale

Chilled, packaged tea is booming as carbonates replacement

Consumed as a BFY beverage, but is RTD tea any healthier?

Unsweetened teas can preserve the health equity of RTD tea

Bringing higher value RTD tea to the European consumer as well

The mixed RTD ‘tea’ category in China

The changing RTD tea category in China

Changing shopper habits in China lead to better, premium tea

New products to reach a younger, social tea drinker in China

Companies: Coca-Cola’s eye on RTD tea

A note of caution: RTD tea is among the most income elastic goods in fmcg

Can “soft ” drivers keep RTD tea strong in Brazil?

Keeping RTD tea strong through flavour and functional positioning

Value Creation Strategies in Hot Tea

Hot tea opportunity in summary

Hot tea dominates global sales volume of tea overall

Hot tea is moving from a commodity to a high value consumer good

Green tea leads in value but black tea is the most consumed

Markets to watch: Hot tea category growth through 2020

Iran: Sanctions relief provides a boost in tea growth

Global companies: A fragmented brand picture for global hot tea

Rising incomes boost green tea’s prospects

Black standard bags: A better builders tea in the UK?

Functional hot tea: Bolder claims for energy and focus

Millennials have a demographic advantage in giant tea markets

Winning younger consumers through education and variety

Where is the value opportunity in Indian tea?

Reaching Indian consumers for packaged tea: Two key groups

Young women experiment with new tea styles in India

Dominance of Europe in fruit /herbal blends

Indulgence in hot tea? Indulgent, flavourful chai

Takeaways: Tea in 2020

Appendix: Competitor Analytics

Competitor Analytics tool

Overview

Competitors

Market Overlap

Treemap

Overlap Matrices

Appendix: Industry Forecast Model

About Euromonitor International’s Industry Forecast Model

Soft drivers and the Industry Forecast Model

Growth decomposition explained

Significance and applications for growth decomposition

Key applications for Industry Forecast Models

Why buy this report?

Want to find out more about this report?

Request more information

Megatrends

Strategy Briefing

Global Tea: Consumer Trends Converge Around Brewed Beverages

New Report Guarantee

About This Report

New Report Guarantee

Overview

Why buy this report?

Tea is the most dynamic category in global beverages

Tea has entered an era of value creation

RTD tea is growing as a BFY option and taking share from carbonates

Hot tea must focus on retaining younger consumers

Outside the off-trade there is strong growth in foodservice tea and alternative tea products

Want to find out more about this report?

Table of Contents

Introduction

Scope

Definitions

Tea: The US$20 Billion Opportunity

Key findings

Tea intersects with the major consumer drivers of food and drinks

Tea is the most consumed beverage on the planet

Versatility of tea creates opportunities across occasions

An era of value creation in tea

Value creation: Price-led growth in tea

Value creation is happening in emerging and developed markets

The US$20 billion opportunity for tea

The Wider Universe of Tea

A wider universe of opportunity for the category

Tea in foodservice: Undeveloped promise

Creating mainstream, affordable tea chains to grow appeal

Demand for craft creates opportunity for tea appliances in the home

Tea has niche opportunities in cocktails and RTD alcoholic drinks

Consumer Segmentation in RTD Tea

RTD tea opportunity in summary

What factors drive RTD tea growth?

Markets to watch: RTD tea category growth through 2020

Turkey: Growth in BFY tea and carbonate replacements

Southeast Asia: Local tea brands establish category leadership

The American RTD tea consumer is going upscale

Chilled, packaged tea is booming as carbonates replacement

Consumed as a BFY beverage, but is RTD tea any healthier?

Unsweetened teas can preserve the health equity of RTD tea

Bringing higher value RTD tea to the European consumer as well

The mixed RTD ‘tea’ category in China

The changing RTD tea category in China

Changing shopper habits in China lead to better, premium tea

New products to reach a younger, social tea drinker in China

Companies: Coca-Cola’s eye on RTD tea

A note of caution: RTD tea is among the most income elastic goods in fmcg

Can “soft ” drivers keep RTD tea strong in Brazil?

Keeping RTD tea strong through flavour and functional positioning

Value Creation Strategies in Hot Tea

Hot tea opportunity in summary

Hot tea dominates global sales volume of tea overall

Hot tea is moving from a commodity to a high value consumer good

Green tea leads in value but black tea is the most consumed

Markets to watch: Hot tea category growth through 2020

Iran: Sanctions relief provides a boost in tea growth

Global companies: A fragmented brand picture for global hot tea

Rising incomes boost green tea’s prospects

Black standard bags: A better builders tea in the UK?

Functional hot tea: Bolder claims for energy and focus

Millennials have a demographic advantage in giant tea markets

Winning younger consumers through education and variety

Where is the value opportunity in Indian tea?

Reaching Indian consumers for packaged tea: Two key groups

Young women experiment with new tea styles in India

Dominance of Europe in fruit /herbal blends

Indulgence in hot tea? Indulgent, flavourful chai

Takeaways: Tea in 2020

Appendix: Competitor Analytics

Competitor Analytics tool

Overview

Competitors

Market Overlap

Treemap

Overlap Matrices

Appendix: Industry Forecast Model

About Euromonitor International’s Industry Forecast Model