As the on-trade was one of the most significant causalities of the pandemic, a channel shift towards the off-trade was seen for some soft drinks. However, RTD tea did not witness a significant spike in off-trade sales over the last two years, and in fact also turned to decline in 2020.
Before the pandemic kombucha was gaining traction, primarily because the product is a good source of probiotics and antioxidants and considered beneficial for gut health. Also, companies were targeting consumers looking for substitutes for sugary drinks.
Hindustan Unilever remained the dominant player in RTD tea in 2021, and the only company to have established a nationwide presence, achieved through its Lipton brand. Its vast distribution network, based on its presence in several product categories, enables it to dominate off-trade sales.
India is home to a large population of young people, who are on the lookout for healthier soft drinks alternatives. This represents enormous potential for the category.
In 2020, sales of RTD tea in the on-trade channel fell by almost half, pegging the industry back a few years. According to the National Restaurant Association of India (NRAI), the foodservice industry declined by more than 50% in FY2021.
Several factors are expected to aid the growth of RTD tea in India, especially healthy variants. The pandemic has resulted in a shift in consumer choice, leading to a rise in demand for healthier beverages.
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This category includes all packaged products based on brewed tea or tea extract. May be sweetened or unsweetened, carbonated or still, with a wide variety of different flavourings. May contain juice.See All of Our Definitions
This report originates from Passport, our RTD Tea research and analysis database.
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