Table of Contents
Executive Summary
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- The market
- Differing segment performance during COVID-19
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- Figure 2: Best- and worst-case forecast of value sales of RTD Asian herbal tea, 2015-2025
- Figure 3: Best- and worst-case forecast of value sales of RTD non-Asian herbal tea, 2015-2025
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- Figure 4: Best- and worst-case forecast of value sales of teabags, 2015-2025
- Companies and brands
- RTD non-Asian herbal tea players benefited from e-commerce and digital marketing
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- Figure 5: Market share of leading RTD tea players, by value, China, 2018-2020
- Targeting consumers’ in-home scenario
- Technology borrowed from adjacent categories
- The consumer
- Consumers upgrading to instant tea formats
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- Figure 6: Consumption frequency, February 2021
- Tea drinks’ role in emotional wellbeing could be bigger
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- Figure 7: Functional interests, February 2021
- Fruit-flavoured tea drinks are the next trend to watch
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- Figure 8: Ingredient preference, February 2021
- Novelty and speciality entice consumers to try new products
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- Figure 9: Purchase drivers, February 2021
- Consumers still buy into more tangible, obvious premiumisation factors
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- Figure 10: Product premiumisation, February 2021
- Mixed views about sugar substitutes but majority still feel positive about their functional benefits
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- Figure 11: Selected attitudes towards sucrose and sugar substitutes, February 2021
- What we think
Issues and Insights
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- Success in instant coffee market can inspire innovation in instant tea
- The facts
- The implications
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- Figure 12: Yongpu flash brew concentrated tea liquid
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- Figure 13: Saturnbird’s Project Return
- Fruit-flavoured tea drinks can cater to emotional wellbeing
- The facts
- The implications
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- Figure 14: Examples of multi-sensory products
- Sugar substitutes generate consumer expectations of functional benefits
- The facts
- The implications
The Market – What You Need to Know
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- COVID-19 dampened out-of-home RTD consumptions
- Teabags winning with increased in-home occasions
- Functional wellbeing features fuel future growth
Market Size and Forecast
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- RTD tea drinks recover from short term decline due to COVID-19 propelled by e-commerce
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- Figure 15: Best-and worst-case forecast of value sales of RTD tea drinks, 2015-2025
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- Figure 16: Best-and worst-case forecast of volume sales of RTD tea drinks, 2015-2025
- Teabags’ rapid growth boosted by increased in-home occasions and new products booming online
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- Figure 17: Best-and worst-case forecast of value sales of teabags, 2015-2025
- Figure 18: Best-and worst-case forecast of volume sales of teabags, 2015-2025
Market Factors
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- Increasing stress in life urges attention to wellbeing
- Sugar substitutes are becoming the new ordinary in consumer choices
- Tea houses have inspired RTD innovation but also limited the latter’s premium pricing
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- Figure 19: Examples of RTD tea drinks inspired by popular flavours in tea houses
- Revival of Chinese heritage and culture brings new vibe
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- Figure 20: Top five claim categories in tea drinks (RTD and tea infusions) launched globally, 2016-2020
- Figure 21: An example of the contemporary tea house Sexy Tea (茶颜悦色)
- Approval of hyaluronic acid as new food material brings innovation opportunities
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- Figure 22: Bloomage Biotech’s new bottled water fortified with hyaluronic acid
- Figure 23: HanKowErChang’s new carbonated flavoured drink fortified with hyaluronic acid
Market Segmentation
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- RTD Asian herbal tea continues to struggle in constrained consumption occasions
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- Figure 24: Best-and worst-case forecast of value sales of RTD Asian herbal tea, 2015-2025
- RTD non-Asian herbal tea propelled with active product innovation
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- Figure 25: Best-and worst-case forecast of value sales of RTD non -herbal tea, 2015-2025
- Teabags ride high on in-home consumption dividend via e-commerce
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- Figure 26: Best-and worst-case forecast of value sales of teabags, 2015-2025
Key Players – What You Need to Know
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- Products revamped with clean label, rich texture and convenience
- Exploring tea drink occasions with blurring experiences
- Premiumisation with tech-supported product innovation
Market Share
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- Tingyi sustained market lead with new channel marketing strategies
- Guangzhou Baiyunshan Pharmaceutical hit by recession in Asian herbal tea
- Uni-President capitalised on younger consumer market
- Other companies are revamping product formats
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- Figure 27: Market share of leading RTD tea players, by value, China, 2018-2020
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- Figure 28: Market share of leading RTD tea players, by volume, China, 2018-2020
Competitive Strategies
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- Tea drinks and coffee blurring revolution
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- Figure 29: Saturnbird and Sexy Tea (茶颜悦色) co-branding in China, 2020
- Targeting in-home consumption
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- Figure 30: C’estbon’s product ZuoWeiChaShi (佐味茶事) launched in China, 2019
- Figure 31: YuanQiSenLin’s baked oolong tea (焙火乌龙茶) in China, 2021
- Marketing to younger generations
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- Figure 32: Examples of Uni-President’s marketing strategies targeting young consumers in China, 2020
Who’s Innovating?
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- Tea concentrations restoring the taste of ‘good tea’
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- Figure 33: Top 5 markets for tea infusion product launches, 2016-2020
- Figure 34: Tea infusion product launches in China, by format, 2016-2020
- Figure 35: Examples of new launches of tea pods and concentrated liquid format tea
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- Figure 36: % of new tea drinks in powder format as a share of total tea infusion launches in China, 2016-2020
- Figure 37: Yongpu’s new concentrated tea product in china
- Teabags brewing for emotional wellbeing
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- Figure 38: Top five functional claims in tea infusion products launched globally, 2016-2020
- Figure 39: Top five functional claims in tea infusion products launched in China, 2016-2020
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- Figure 40: Chali (left) and Nayuki (right) gift packages in china
- Figure 41: Samova’s Flowering Teabags product in Germany, the teabag opens slowly depending on the water temperature
- Figure 42: Minorien’s Fishing Cat Tea in Japan
- Cold brew tea technology redefines freshness
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- Figure 43: Top 5 claims in RTD tea drink product launches in China, 2016-2020
- Figure 44: Examples of tea drinks utilising HPP technology
The Consumer – What You Need to Know
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- Consumers favour new formats
- Comforting stress with fruit-flavoured tea drinks
- Consumers are prepared to pay more for sugar substitutes
Consumption Frequency
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- Freshly brewed tea leaves lead in daily consumption habits
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- Figure 45: Consumption frequency, February 2021
- Top sellers in tea houses may be shortcut for ready-to-drink tea
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- Figure 46: Consumption frequency, by type of users, February 2021
- Growing consumption of instant tea drinks across all income levels
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- Figure 47: Consumption frequency, by type of users, January 2017, February 2020 & 2021
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- Figure 48: Consumption frequency, by type of users, by income level, February 2020 & 2021
- Freshly brewed tea leaves and herbal tea popularity is declining
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- Figure 49: Consumption frequency, February 2020 & 2021
Interest in Functional Claims
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- Drinking tea to relieve stress
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- Figure 50: Interest in functional claims, February 2021
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- Figure 51: RTD tea drink product launches with functional claims in china, 2016-2020
- Different focuses among men and women
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- Figure 52: Functional interests, by gender, February 2021
Ingredient Pairing
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- Fruity ingredients favoured for their natural and relieving features
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- Figure 53: Ingredient preference, February 2021
- Interest in plant-based milk is higher than dairy milk
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- Figure 54: Ingredient preference, plant-based milk vs dairy milk, February 2021
- Opposite ends of age spectrum prefer pure tea
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- Figure 55: Ingredient preference – I like pure tea for this, by age group, February 2021
New Product Purchase Triggers
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- Novelty and speciality rank top
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- Figure 56: New product purchase triggers, February 2021
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- Figure 57: New product purchase triggers, TURF analysis, February 2021
- Females are fans of packaging appearance
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- Figure 58: Purchase drivers, by gender, February 2021
- IWOM targets segmented consumer groups
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- Figure 59: Purchase drivers, by gender and age group, February 2021
Premium Features
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- Innovation in freshness is wanted by the young
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- Figure 60: Product premiumisation, February 2021
- Dissimilar features desired by women of different income levels
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- Figure 61: Product premiumisation, by female and income levels, February 2021
- Organic well matched with beauty enhancing features
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- Figure 62: Product premiumisation, by interest in functional claims, February 2021
Attitudes towards Sucrose and Sugar Substitutes
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- Confusion about what sugar-free means still common
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- Figure 63: Selected attitudes towards sucrose and sugar substitutes, February 2021
- Nearly half of consumers have no negative health association with sugar substitutes
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- Figure 64: Selected attitudes towards sucrose and sugar substitutes (association with health), February 2021
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- Figure 65: Selected attitudes towards sucrose and sugar substitutes (association with health), February 2021
- Be more vocal about potential functional benefits of sugar substitutes
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- Figure 66: Selected attitudes towards sucrose and sugar substitutes, February 2021
- Figure 67: Selected attitudes towards sucrose and sugar substitutes, February 2021
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- Figure 68: Selected attitudes towards sucrose and sugar substitutes, February 2021
- Figure 69: RTD tea drink product launches with sugar-free claims in China, 2016-2020
Appendix – Market Size and Forecast
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- Figure 70: Total market value of RTD tea drinks, China, 2015-2025
- Figure 71: Total market volume of RTD tea drinks, China, 2015-2025
- Figure 72: Total market value of teabags, China, 2015-2025
- Figure 73: Total market volume of RTD teabags, China, 2015-2025
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Appendix – Market Segmentation
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- Figure 74: Total market value of RTD Asian herbal tea drinks, China, 2015-2025
- Figure 75: Total market value of RTD non-Asian herbal tea drinks, China, 2015-2025
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Appendix – Methodology and Abbreviations
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- Report Methodology
- TURF Analysis Methodology
- Abbreviations
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