What you need to know
Sales of tea, hot chocolate and hot malted drinks declined by 4% in 2015 to £793 million. The market continued to be impacted by falling consumption of standard black tea, as well as price activity. The tea market is changing though, with growth in sales of green, herbal/fruit and speciality teas leading to mainstream brands such as PG Tips and Tetley expanding their product offers.
The growth in these segments of the tea market is not currently enough though to make up for the reductions seen in sales of standard black tea. Encouraging trading up in the latter area and encouraging more drinking of black tea among younger people will be important to stem the decline. Tea competes against a wide range of other drinks, so a focus on new flavours and functional benefits can increase appeal.
Sales of hot chocolate and hot malted drinks have also declined. The development of new formats, formulations and flavours is needed to expand usage to more occasions beyond drinking before bedtime. This can help to inject new life into these categories and give them a bigger presence in the drinks market.
Products covered in this report
For the purposes of this Report, Mintel has used the following definitions:
The tea market is segmented – and defined – as follows:
Ordinary teabags, which contain black tea, account for the majority of standard black teas in the UK market and are the main product for brand leaders such as PG Tips and Tetley. Black tea usually has a rich taste, which means it is suited to being served with milk and sugar.
Decaffeinated tea is used to refer to black tea that has been through a process to remove most of the caffeine content.
Speciality tea is used to refer to tea which, although similar in appearance to standard tea and also often drunk with milk, is usually sourced from specific high-quality tea plantations and has a distinctive taste. Examples include Earl or Lady Grey, Chai and Darjeeling, Ceylon, Assam and Kenyan blends.
Fruit and herbal teas are typically infusions which contain pieces of fruit, herbs (eg peppermint), spices or flowers (eg camomile). Tending not to contain black or green tea, they are generally caffeine-free. The segment also includes Redbush tea.
Green tea is a tea which is a light green colour when brewed and is generally drunk without milk. In contrast to black tea which is oxidised, green tea is un-oxidised and has a more bitter flavour.
Instant tea comes in powder or granule form and contains soluble tea solids, sometimes with the addition of sweetener, milk powder and/or flavourings.
Hot chocolate drinks are defined as follows:
Hot chocolate powder that requires the addition of either milk or water. It also includes products that are ready prepared and need to be heated in the microwave, as well as stir-in spoons (that are stirred into hot milk).
Cocoa and cocoa powder.
Malted drinks are defined as follows:
Malted drinks that require the addition of either milk or water.
Malted hot chocolate drinks, eg Ovaltine malted drinks, chocolate malted drinks.
Excluded
This report excludes teas and other hot drinks sold through catering outlets (ie cafés, restaurants, pubs) or vending machines. It also excludes all iced teas and RTD (ready-to-drink) teas.
Coffee is excluded and is examined in Mintel’s Coffee – UK, August 2016 Report.
