Tea – and why it matters

Tea remains the nation’s favourite hot beverage but you’d never know it, judging by the lack of attention the category often gets – so is it time for a fresh look?

It’s easy to overlook the fact that tea stubbornly continues to be the nation’s favourite hot beverage. The local retailing trade is falling over itself to embrace coffee, yet tea remains a bigger market – and it’s growing. According to Kantar data from as recently as August, buyer numbers were actually up 0.3%, despite the fact this is one of the most mature categories in the industry.

The fact that tea has been around a long time doesn’t mean that the category isn’t constantly evolving and changing. Core black tea still accounts for a huge chunk of all tea sold – 78% – but a wave of innovation has brought new shoppers into the category.

Peter Dries, Director of Customer and Shopper Marketing at Tata Global Beverages, explains: “Evolving lifestyles and interest in health has created space for new products delivering different taste experiences to shoppers and higher value sales to retailers.

“Today the tea category is full of choice, from a relaxing, comforting tea break; to maintaining hydration with a healthier drink; not to mention the opportunity to increase wellbeing with teas with added vitamins; a wide range of teas is now available to suit all tastes, needs and moments.

“The challenge for retailers is to keep pace with changing tastes and what drives purchase, and use their knowledge to adapt their tea range to maximise sales. Getting it right can result in greater sales and profits in tea and other categories.”

Don’t forget too that the tea shopper is a valuable shopper to local retailers. Of everyone buying hot beverages, tea buyers are more likely to buy complementary products with their tea purchase. Milk, bread, cakes and biscuits are common basket companions, as well as cakes and pastries for on-the-go purchases. (HIM! CTP 2018).

As highlighted above, core everyday black teas still account for more than three quarters of all teas sold, so remain a critical backbone of the category, with the big brands driving nearly 80% of those sales.

But to give your store the chance to grow the tea category, it’s vital to include a selection of different teas.

In grocery multiples, for instance, non-everyday black teas account for 45.3% of category value sales. This drops to just 18.1% in total impulse. Are local retailers over-reliant on everyday black tea?

Dries certainly thinks so: “Returns will come from having a strong black tea offering, balanced by a mix of non-black teas selected to appeal most to your customers. Repertoire tea drinkers who drink different types of tea are important to cater to as they drink more tea more often.”

Options to consider:

• Decaf – it’s a good idea to complement every day black tea with a decaf option. Decaf drinkers won’t choose an alternative, so if one isn’t available, a sale won’t be made.
• Health – tea’s good fit with health continues to be a draw and value sales are up across the board in impulse for products that fit the bill here: Fruit and Herbal (up 18.4%); Green (up 16.5%) and Redbush (up 8.9%). Fruit and Herbal and Green are up in volume too. Within Green, Tetley has four of the top 10 SKUs in Impulse, including Tetley Pure Green 20s and Tetley Green and Lemon 20s. Both are available in price-marked packs of £1.49 and are showing volume growth in Impulse of 18.7% and 9.5% respectively.
• Tea with functional benefits – with more and more shoppers wanting to take the additional vitamins they need through their diet, functional food and drink with added vitamins has become a major trend. Functional teas have become a big draw and are bringing something very different to the shelf. According to a study by Kantar, 31% of consumers select products for their health benefits, naturalness and positive nutritional content. Tetley has led the way in functional teas with its suite of Tetley Super teas. These have added vitamins and EFSA approved health claims ranging from immune system support to reducing tiredness and fatigue. The success of Tetley’s range of functional drinks has made this an important area of the company’s business. Spanning Green Tea, Fruit and Herbal and new Super Squash, the award-winning Tetley Supers range includes 20 variants with seven different health benefits. Tetley Supers have brought new customers into both the Green & Fruit and Herbal segments and delivered strong sales and levels of repeat purchase.
• Cold infusions – Tetley is active in an emerging category in the market for cold infusions. The desire to hydrate and quench thirst are the biggest drivers of cold drinks sales [Kantar Usage Study] and Tetley Cold Infusions are an easy and tasty way to add a fruity burst of flavour to water – perfect for warmer seasons and for customers to enjoy on-the-go. Available in packs of 12 infusions they have an RSP of £2.49 and come in five flavours: Raspberry & Cranberry; Passionfruit & Mango; Orange & Peach; Mint, Lemon & Cucumber and new Strawberry & Watermelon. To boost convenience and on-the-go sales Tetley has launched a new clip strip carrying 12 units of three infusions with an RSP of £1 each.