Table of Contents
Issues in the Market
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- Definitions
- Four major market themes
Insights and Opportunities
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- Moving it more into the emotional territory to add value
- Reintroduce the ritual
- Developing new channels to market
- Increase out of home consumption
- Target children
Market in Brief
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- A very English obsession
- Consumers experimenting outside of the category
- Standard tea still dominates but it is losing share…
- … as new healthier teas emerge…
- …that are marketed on an emotional platform
- Tetley and PG Tips lead….
- …. but Twinings is the big winner
- Changes in the tea repertoire
- New sectors will lead future growth
Fast Forward Trends
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- Trend 1: “X for eXtreme”
- General observations
- Market touchpoints/implications
- Trend 2: Chips with everything
- Definition
- What it is – general observations
- Market touchpoints/implications
Internal Market Environment
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- Health is a key consumer concern
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- Figure 1: Agreement with selected lifestyle statements, 2002-06
- More people want to be healthy
- Caffeine – pros and cons
- Herbal teas provide an option
- Antioxidants and theanine
- Lifestyle teas go one step further
- Organics and Fairtrade
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- Figure 2: Attitudes to organics and Fairtrade, 2002-06
- Growth in interest
- Organic strong in herbal and green teas
- Kenyan tea drought
Broader Market Environment
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- AB socio-economic status growing
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- Figure 3: Changes in socio-economic status, 2001-06
- Middle classification of the population
- Complex changes in the age profile
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- Figure 4: Changes in the UK demographic profile, by age, 2001-06
- Ageing population haven’t boosted standard tea sales…
- …And, worse still, future sales may struggle more
- 25-34 are declining
- A very English drink
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- Figure 5: Consumption of tea in the last 12 months, by country, 2006
- Tea drinking is an obsession of the British
Competitive Context
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- Figure 6: Consumption of other non-alcoholic drinks in the last 12 months, 2002-06
- Tea is Britain’s most popular hot drink
- Other hot drinks in decline
- Range of threats from cold drinks
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Strengths and Weaknesses in the Market
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- Strengths
- Weaknesses
Who’s Innovating?
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- Most new products have been launched in the new areas
- Small to medium sized companies have launched
- From flavours to benefits
- Own-label follows with ‘me too’ products
- The world goes healthy
- New product briefs
Market Value or Size and Forecast
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- Overall market value declining
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- Figure 7: UK retail sales of tea and herbal tea, at current and constant 2001 prices, 2001-06
- Market decline halted
- Smaller growth sectors influential
- Volume continues to decline
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- Figure 8: UK retail sales of tea and herbal tea, by volume, 2001-06
- Forecast and the future
- Market growth set to rise
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- Figure 9: Market forecast of tea and herbal tea by current prices, 2006-11, prices and volume
- A tale of two sectors
- Older consumers will remain the more traditional
- Growing number of females aged 25-34 will help augment the market
- Factors incorporated in the forecast
Segment Performance
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- Types of tea
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- Figure 10: UK retail sales of tea and herbal tea, by value, 2002-06
- Standard tea losing share
- A sense of adventure
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- Figure 11: UK retail sales of tea and herbal tea, by type and volume, 2002-06
- Standard tea
- Dominant but losing out
- Some growth areas…
- …but not in others
- Loose tea
- Fruit and herbal tea is the key growth sector
- The retailers like it…
- …because their consumers perceive it as healthy
- Green tea has been the fastest growing sector
- Healthy and flexible
- Flavours
- Speciality teas growing with connoisseurship
- Teabags – format
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- Figure 12: UK retail sales of standard tea bags*, by type and value, 2002-06
- Little change in recent years
Market Share
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- Traditionally brand loyal
- New sectors provide new opportunities…
- …for new brands through alternative channels to market
- Future revival for Typhoo
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- Figure 13: Estimated brand shares of the UK retail tea market, 2002-06
- Own-label relatively weak in this market
- New sectors = new opportunities
Companies and Products
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- Company profiles
- Associated British Foods/Twinings
- Bettys & Taylors of Harrogate
- Clipper Teas
- Dragonfly
- Dr Stuart’s/Only Natural Products
- The Drury Tea & Coffee Company
- Apeejay Surrendra Group/Typhoo
- Tata Tea/Tetley
- Unilever/PG Tips
- Whittard of Chelsea
- Other companies
- Birt & Tang
- Celestial Seasonings
- Hampstead Tea
- The London Tea Company
- Northern Tea Merchants
- Pukka Herbs
- Redbush Tea Company
- Union Coffee Roasters
- Yogi Tea
- Traidcraft
- Cafédirect
- Oxfam Fairtrade Company
- Punjana
Brand Elements
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- Tetley
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- Figure 14: Words associated with Tetley
- Brand qualities
- Recommendations
- Tailoring to a broad audience
- Age before beauty
- Not just builders tea
- PG Tips
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- Figure 15: Words associated with PG Tips
- Brand qualities
- Recommendations
- Cool it
- Tea in the park
- Healing beyond herbal
- Twinings
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- Figure 16: Words associated with Twinings
- Brand qualities
- You are what you drink?
- Recommendations
- Just the tip of the iceberg
- Anyone for tennis?
- Clipper
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- Figure 17: Words associated with Clipper
- Brand qualities
- When feel good isn’t enough
- Recommendations
- Whiter than white
- Usage of tea brands
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- Figure 18: Usage of tea brands
- Attitudes towards brands
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- Figure 19: Attitudes towards brands
- Brand satisfaction and performance
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- Figure 20: Brand satisfaction and performance
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- Figure 21: Brand commitment
Brand Communication and Promotion
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- Figure 22: Main monitored media advertising expenditure on tea, 2002-06
- Expenditure recovering
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- Figure 23: Main monitored media spend, by leading brands, 2003-06
- Twining’s spending leaps
- Brand identity
- TV is important
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- Figure 24: Main monitored media spend, by media channel, 2005
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Channels to Market
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- Changing distribution map
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- Figure 25: UK retail sales of tea and herbal tea, by type of outlet and value, 2002-06
- Multiples grow in convenience
Consumer 1 – Who: Usage and Frequency?
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- Tea made from teabags including herbal/fruit tea
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- Figure 26: Consumption of tea made from teabags in the last 12 months, 2002-06
- Slow decline in consumption
- Brand loyalty
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- Figure 27: Solus users by gender, age and socio-economic status, 2006
- Frequency of usage of standard tea declining
- Older people drink more tea
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- Figure 28: Usage and heavy usage of standard bagged tea, 2006
- Conservative older tea drinkers
- Younger consumers are lighter/medium users
- How to get younger people interested
- Women having just given birth avoid tea
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- Figure 29: Weight of usage of standard bagged tea, by age of children in household, 2006
- Herbal teas getting more popular
- Distinct consumer profile
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- Figure 30: Usage of bagged fruit and herbal tea, by age, 2006
- Female bias
- Youngish and affluent
- Health concerns see consumption during/post-childbirth fall
- Non-usage rises amongst mothers
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- Figure 31: Weight of usage of fruit and herbal tea, by age of children, 2006
- New approach for further expansion
- Internet users prefer fruit and herbal teas but DIY-ers drink standard
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- Figure 32: Teabags usage cross-tab, 2006
- How ? – the wired kitchen
- Packet tea
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- Figure 33: Consumption of packet tea in the last 12 months, 2002-06
- Packet tea is in decline
- Older people are the heavy users
- ABs drink it less frequently
- Packet tea is prevalent in smaller households
- Does the decline matter?
Consumer 2 – Motivations for Non-usage
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- Why drink fruit and herbal tea?
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- Figure 34: Motivations for drinking fruit and herbal tea, October 2006
- An alternative
- And a healthy one
- Broad backing for health
- Women more specific
- Reasons given for drinking fruit and herbal teas
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- Figure 35: Number of reasons given for drinking herbal/fruit tea
- Mostly one reason
- Women have more reasons
- Motivations for not drinking
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- Figure 36: Motivations for not drinking fruit and herbal tea, October 2006
- Fruit and herbal tea just do not appeal
- Men and the elderly are the most anti herbal tea
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- Figure 37: Motivations for not drinking fruit and herbal tea, October 2006
Consumer 3 – Further Analysis
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- Figure 38: Tea repertoire, 2002-06
- Herbal tea added to the repertoire
- Increase in non-tea drinkers
- Standard tea is male, old and downmarket
- Upmarket women incorporate herbal tea into their repertoire
- Young deserting tea?
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Appendix
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- Introduction
- Abbreviations
- Internal market environment
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- Figure 39: Agreement with selected lifestyle statements by demographic sub-group, 2006
- Figure 40: Agreement with selected lifestyle statements by demographic sub-group, 2006
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- Figure 41: Agreement with selected lifestyle statements by demographic sub-group, 2006
- Brand communication and promotion
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- Figure 42: Main monitored media spend, 2003-06
- Consumer 1 – detailed demographics
- Tea made from teabags
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- Figure 43: Consumption of tea made from teabags in the last 12 months, by demographic sub-group, 2006
- Tea made from standard teabags
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- Figure 44: Consumption of standard tea made from teabags in the last 12 months, by demographic sub-group, 2006
- Fruit and herbal tea made from teabags
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- Figure 45: Consumption of herbal/fruit tea made from teabags in the last 12 months, by demographic sub-group, 2006
- Packet tea usage
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- Figure 46: Consumption of packet tea in the last 12 months, by demographic sub-group, 2006
- Consumer 2 – detailed demographics
- Consumption
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- Figure 47: Consumption of fruit and herbal teas, October 2006
- Why drink?
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- Figure 48: Motivations for drinking fruit and herbal teas, October 2006
- Figure 49: Motivations for drinking fruit and herbal teas, October 2006
- Number of reasons to buy
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- Figure 50: Q6 repertoire by demographics, October 2006
- Why don’t drink nowadays
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- Figure 51: Motivations for not drinking fruit and herbal teas nowadays, October 2006
- Figure 52: Motivations for not drinking fruit and herbal teas nowadays, October 2006
- Consumer 3 – further analysis
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- Figure 53: Tea repertoire, by demographic sub-group, 2006
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