Table of Contents
Executive Summary
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- The market
- Decline in total sales of tea and other hot drinks
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- Figure 1: UK retail value sales and forecast for the tea*, hot chocolate and hot malted drinks market, 2011-21
- Green tea the biggest boost to tea market
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- Figure 2: UK retail value sales of tea, by segment, 2013-15
- Companies and brands
- PG Tips’ lead over Twinings narrows
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- Figure 3: Top brands’ sales and shares in the UK tea market, by value, 2015-16
- The consumer
- Half of people drink standard black tea daily
- Room to encourage more drinking of hot chocolate
- Strong brand loyalty in tea buying
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- Figure 4: Prompts that would encourage people to buy a different tea type/brand, May 2016
- Low price and promotions exert a big influence
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- Figure 5: Most important factors influencing choice when buying one tea type/brand over another, May 2016
- Strong interest in tea with added health benefits
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- Figure 6: Interest in trying different products, May 2016
- Speciality teas can appeal as a treat and encourage trading up
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- Figure 7: Attitudes towards tea and other hot drinks, May 2016
- What we think
Issues and Insights
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- NPD needed to drive more tea drinking among younger generation
- The facts
- The implications
- Adding value to tea market through wider repertoires and trading up
- The facts
- The implications
- New features and formats needed in hot chocolate and malted drinks to develop new usage occasions
- The facts
- The implications
The Market – What You Need to Know
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- Decline in total sales of tea and other hot drinks
- Long-term decline in tea consumption continues
- Green tea the biggest boost to the tea market
- Fall in sales of hot chocolate and hot malted drinks
- Need for market to encourage more drinking by younger people
Market Size and Forecast
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- Declining sales of standard black tea hits total market
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- Figure 8: UK retail sales for the tea*, hot chocolate and hot malted drinks market, by volume and value, 2011-21
- No immediate signs of recovery in total tea sales
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- Figure 9: UK retail value sales and forecast for the tea*, hot chocolate and hot malted drinks market, 2011-21
- Forecast methodology
Segment Performance
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- Declining black tea sales continue to hit market
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- Figure 10: UK retail value and volume sales of tea*, 2011-21
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- Figure 11: UK retail value sales and forecast for tea*, 2011-21
- Green tea provides the biggest boost to the market
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- Figure 12: UK retail value sales of tea, by segment, 2013-15
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- Figure 13: UK retail volume sales of tea, by segment, 2013-15
- Decline in sales of hot chocolate and malted drinks
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- Figure 14: UK retail value and volume sales for the hot chocolate and hot malted drinks market, 2011-21
- Figure 15: UK retail value sales and forecast for the hot chocolate and hot malted drinks market, 2011-21
- Need for more marketing activity to encourage drinking
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- Figure 16: UK retail value sales of hot chocolate and hot malted drinks, by segment, 2013-15
- Figure 17: UK retail volume sales of hot chocolate and hot malted drinks, by sector, 2013-15
Market Drivers
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- Long-term decline in tea but more drinking of coffee
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- Figure 18: UK household purchases of tea, coffee and cocoa, hot chocolate and malt drinks, 2001-14
- Competition from soft drinks and waters
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- Figure 19: UK household purchases of mineral and spring waters and soft drinks, 2001-14
- Younger people need encouraging to drink more tea
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- Figure 20: Trends in the age structure of the UK population, 2010-20
Key Players – What You Need to Know
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- PG Tips’ lead over Twinings narrows
- Yorkshire Tea and Pukka see sales growth
- Mondelēz has nearly half of hot chocolate sales
- Big focus on flavour extensions in tea
- Increasing choice of green and speciality teas
- Confectionery brands extend hot chocolate offer
- Darker or more indulgent hot drinks and different formats
- Increase in 2015 advertising for teas
- PG Tips the most trusted brand
- Twinings stands out for innovation and high quality
- Typhoo has more lapsed users
Market Share
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- PG Tips’ market lead over Twinings is narrowing
- Yorkshire Tea and Pukka see sales growth
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- Figure 21: Top brands’ sales and shares in the UK tea market, by value and volume, 2014/15 and 2015/16
- Mondelēz accounts for nearly half of hot chocolate sales
- Tassimo benefits from popularity of pod machines
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- Figure 22: Leading brands’ sales and shares in the UK hot chocolate market, by value and volume, 2014/15 and 2015/16
- Horlicks and Ovaltine dominate hot malted drinks
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- Figure 23: Leading brands’ sales and shares in the UK malted drinks market, by value and volume, 2014/15 and 2015/16
Launch Activity and Innovation
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- Tea bags dominate launch activity
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- Figure 24: New product launches in the UK tea market, by format type, 2011-16
- Twinings leads launch activity with flavour extensions
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- Figure 25: Examples of new flavour launches in the UK tea market, 2015 and 2016
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- Figure 26: Further examples of new flavour launches in the UK tea market, 2015 and 2016
- Tetley puts focus on added health benefits
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- Figure 27: Examples of Tetley’s super’ fruits and green tea launches in the UK tea market, 2015 and 2016
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- Figure 28: New product launches in the UK tea market (top 12*), by company, 2011-16
- Increasing choice of green teas available
- Packaging revamp for PG Tips and more blends to choose from
- Ethical claims prominent in the tea market
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- Figure 29: New product launches in the UK tea market, by claims (top 15*), 2011-16
- Chocolate confectionery brands extend hot chocolate offer
- Options was the focus of launch activity for Ovaltine
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- Figure 30: Examples of launches in the UK hot chocolate market, 2015 and 2016
- More indulgent hot chocolates and added flavours
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- Figure 31: Examples of launches in the UK hot chocolate market, 2015 and 2016
- Figure 32: New product launches in the UK malt and other hot beverages market, by company, 2011-16
- ‘Light’ products prominent and low-sugar claims growing
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- Figure 33: New product launches in the UK malt and other hot beverages market, by claims (top 12*), 2011-16
Brand Communication and Promotion
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- Big increase in 2015 advertising
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- Figure 34: Recorded above-the-line, online display and direct mail total advertising expenditure on tea and other hot drinks, 2012-16
- Taylor’s Yorkshire Tea biggest spender
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- Figure 35: Recorded above-the-line, online display and direct mail total advertising expenditure on tea, by advertiser, 2012-16
- Twinings benefits from encouraging everyday drinking
- Unilever’s PG Tips launches ‘Keep It Tea’ campaign
- Tetley looks to mix of new products and nostalgia
- Clipper Teas pushes green tea range
- Return to major advertising for Typhoo
- Nielsen Media Research coverage
Brand Research
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- What you need to know
- Brand map
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- Figure 36: Attitudes towards and usage of selected brands, May 2016
- Key brand metrics
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- Figure 37: Key metrics for selected brands, May 2016
- Brand attitudes – PG Tips the most trusted brand
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- Figure 38: Attitudes, by brand, May 2016
- Brand personality – Pukka stands out for being vibrant and ethical
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- Figure 39: Brand personality – Macro image, May 2016
- Authenticity – A key strength for Yorkshire Tea
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- Figure 40: Brand personality – Micro image, May 2016
- Brand analysis
- Twinings stands out for consistently high quality
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- Figure 41: User profile of Twinings, May 2016
- Yorkshire Tea the most authentic brand
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- Figure 42: User profile of Yorkshire Tea, May 2016
- Pukka has a vibrant, fun and ethical image
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- Figure 43: User profile of Pukka, May 2016
- PG Tips the most refreshing and accessible brand
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- Figure 44: User profile of PG Tips, May 2016
- Tetley among the most trusted and accessible brands
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- Figure 45: User profile of Tetley, May 2016
- Typhoo lacks standout and brand commitment
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- Figure 46: User profile of Typhoo, May 2016
The Consumer – What You Need to Know
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- Half of people drink standard black tea daily
- Younger, more affluent bias to drinking of other teas
- Room to encourage more drinking of hot chocolate
- Drinking standard black tea spread throughout most of day
- Strong brand loyalty in tea buying
- Low price and promotions exert a big influence
- Strong interest in tea with added health benefits
- A wider variety of flavours can increase the appeal of tea
- Speciality teas can appeal as a treat and encourage trading up
- Being unhealthy or too sweet limiting drinking of hot chocolate
Drinking of Tea and Other Hot Drinks
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- Half of people drink standard black tea daily
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- Figure 47: Frequency of drinking different types of hot drink, May 2016
- Younger, urban and affluent bias to drinkers of other teas
- Half of people drink hot chocolate but most do so no more than once a week
- Half of people drink more than one type of tea
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- Figure 48: Number of different types of tea drunk in last month, May 2016
- Number of cups of standard black tea drunk
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- Figure 49: Number of cups of standard black tea drunk per day by drinkers of standard black tea, May 2016
Times of Day for Drinking Hot Drinks
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- Drinking black tea spread throughout most of the day
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- Figure 50: Times of day people typically drink different types of hot drinks, May 2016
Factors Influencing Choice of Tea
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- Strong brand loyalty when shopping for tea
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- Figure 51: Sticking to one tea product vs buying different tea products, May 2016
- Strong interest in free samples
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- Figure 52: Prompts that would encourage people to buy a different tea type/brand, May 2016
- Price has a big influence on decision making
- Regional British heritage more important to older tea drinkers
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- Figure 53: Most important factors influencing choice when buying one tea type/brand over another, May 2016
- Being ethically sourced a significant consideration
Interest in Trying Different Products
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- Strong interest in tea with functional health benefits
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- Figure 54: Interest in trying different products, May 2016
- Added flavours can increase interest in standard black tea
- Tea capsules/pods have limited appeal
- Room for added-value hot chocolates
Attitudes towards Hot Drinks
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- Room for more indulgence in tea market
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- Figure 55: Attitudes towards tea and other hot drinks, May 2016
- Caffeine content only a limited barrier to drinking tea
- Healthy living limiting the drinking of hot chocolate
- Flavour of hot malted drinks a barrier to purchasing
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Consumer research methodology
Appendix – The Market
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- Figure 56: Best- and worst-case forecast of total UK retail volume sales of tea*, hot chocolate and hot malted drinks, 2011-21
- Figure 57: Best- and worst-case forecast of total UK retail value sales of tea*, hot chocolate and hot malted drinks, 2011-21
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- Figure 58: Best- and worst-case forecast of total UK retail volume sales of tea*, hot chocolate and hot malted drinks, 2011-21
- Figure 59: Best- and worst-case forecast of total UK retail volume sales of tea*, 2011-21
- Figure 60: Best- and worst-case forecast of total UK retail value sales of tea*, 2011-21
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- Figure 61: Best- and worst-case forecast of total UK retail volume sales of tea*, 2011-21
- Figure 62: Best- and worst-case forecast of total UK retail volume sales of hot chocolate and hot malted drinks, 2011-21
- Figure 63: Best- and worst-case forecast of total UK retail value sales of hot chocolate and hot malted drinks, 2011-21
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- Figure 64: Best- and worst-case forecast of total UK retail volume sales of hot chocolate and hot malted drinks, 2011-21
- Fan chart forecast
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Appendix – Key Players
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- Figure 65: Top manufacturers’ sales and shares in the UK tea market, by value and volume, 2014/15 and 2015/16
- Figure 66: Top manufacturers’ sales and shares in the UK hot chocolate market, by value and volume, 2014/15 and 2015/16
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- Figure 67: Top manufacturers’ sales and shares in the UK malted drinks market, by value and volume, 2014/15 and 2015/16
- Figure 68: New product launches in the UK tea market, by launch type, 2011-16
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- Figure 69: New product launches in the UK tea market, by branded vs private label, 2011-16
- Figure 70: New product launches in the UK malt and other hot beverages market, by branded vs private label, 2011-16
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- Figure 71: New product launches in the UK malt and other hot beverages market, by launch type, 2011-16
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