Tea in Latvia

PROSPECTS

Health, wellness and functionality shape tea in Latvia

Health and wellness remain important drivers behind tea innovation and its growth. Products allowing consumers to live more productive and healthier lives are to remain in high demand and continue shaping the category.

Black tea continues to decline

Black tea, the largest category, remains the core, but sales are expected to continue declining, as it has become more mature and less eventful whilst other segments are at the forefront of consumers’ minds, reinforced by abundant innovation and education about them. Traditional black tea is losing to more dynamically developing tea categories, as consumers also perceive the latter as healthier tea options.

On-trade tea consumption continues to grow

On-trade tea consumption continues to grow as a result of consumers spending more on eating and drinking outside of home and on to-go products thanks to the improving economic environment and rising incomes. A previously strong perception of tea as a beverage to be consumed mainly at home is changing amongst Latvians as tea is now widely available in coffee shops and retailers are offering hot beverages to go.

COMPETITIVE LANDSCAPE

Lipton refreshes herbal and green tea offers

Lipton continues to lead tea in Latvia with a double-digit value share based on its strong presence within black tea. Due to lack of growth potential in black tea Unilever has expanded its Lipton herbal teas offer with the Wellness tea range and launched a functional green tea range, which includes such varieties as Immunity, Fitness, Boost and Beauty; these additions are expected to strengthen Unilever’s share in fruit/herbal and green tea.

Competitive tea category dominated by a few established brands

Tea remains a competitive category, dominated by a few established brands such as Unilever’s Lipton and Inteka’s Mozums, followed by smaller Apsara, Greenfield, Pickwick, and Ahmad Tea; these six brands account for approximately two thirds of the retail volume. Strong presence in retail, smart merchandising and promotions support the position of these well-established brands.

Lidl’s start of operations in Latvia to increase the share of private label

Modern grocery retailers remains a key sales channel for tea in Latvia with the dominating role played by supermarkets and hypermarkets. However, Lidl’s anticipated opening in Latvia will influence the landscape of modern retail and tea sales in the country.

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