Table of Contents
Executive Summary
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- The issues
- Bagged/loose leaf tea sales decline
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- Figure 1: Total US retail sales and forecast of tea and RTD tea, by segment, at current prices, 2011-21
- Tea remains second to coffee consumption
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- Figure 2: Mintel Beverage Tracker – Recent coffee/tea consumption at and away from home, trended December 2014 to April 2016
- High bagged tea consumption rates do not translate to sales gains
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- Figure 3: Tea consumption – Any consumption, June 2016
- Need to expand usage occasions among US drinkers
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- Figure 4: Attitudes toward brewed tea – Hot tea is only good when I am sick, June 2016
- The opportunities
- Brewed tea premiumization opportunity
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- Figure 5: Attitudes toward brewed tea – Premiumization, June 2016
- Brewed tea consumers believe health benefits
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- Figure 6: Attitudes toward brewed tea – Health, June 2016
- RTD innovation featuring health, functionality, and specialty preparation methods
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- Figure 7: Ready-to-drink tea innovation, June 2016
- Expand usage occasions for brewed and RTD teas
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- Figure 8: Tea drinking occasion, June 2016
- What it means
The Market – What You Need to Know
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- Tea and RTD tea grows 5.6% in estimated 2016
- Canned/bottled RTD teas leading segment performer
- Bagged/loose leaf tea competes with RTD varieties, and tea with coffee
Market Size and Forecast
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- Category sales forecast to grow 5.6% in 2016
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- Figure 9: Total US retail sales and fan chart forecast of tea and RTD tea, at current prices, 2011-21
- Figure 10: Total US retail sales and forecast of tea and RTD tea, at current prices, 2011-21
- Figure 11: Total US retail sales and forecast of tea and RTD tea, at inflation-adjusted prices, 2011-21
Market Breakdown
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- Canned/bottled tea segment dominates the category
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- Figure 12: Total US retail sales and forecast of tea and RTD tea, by segment, at current prices, 2011-21
- Canned/bottled, refrigerated teas expected to grow through 2021
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- Figure 13: Total US retail sales and forecast of tea and RTD tea, by segment, at current prices, 2011-21
- Supermarkets, “other” channels dominate in tea sales
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- Figure 14: Total US retail sales of tea and RTD tea, by channel, at current prices, 2011-16
- Natural channel tea sales outpace the overall category
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- Figure 15: Natural supermarket sales of tea, at current prices, rolling 52 weeks April 2014 to April 2016
- Bagged/loose leaf teas leading segment at natural channels
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- Figure 16: Natural supermarket sales of tea, by segment, at current prices, rolling 52 weeks ending April 2016
Market Perspective
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- RTD tea versus bagged/loose leaf tea
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- Figure 17: Tea consumption – Any consumption, June 2016
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- Figure 18: Tea consumption – Bagged/loose leaf/single cup tea, by Tea consumption - RTD tea, June 2016
- Figure 19: Tea consumption – RTD tea, by tea consumption – Bagged/loose leaf/single cup tea, June 2016
- Coffee more popular than tea
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- Figure 20: Mintel Beverage Tracker – Recent coffee/tea consumption at and away from home, trended December 2014 to April 2016
- At-home tea consumption dominates foodservice consumption
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- Figure 21: Mintel Beverage Tracker – Recent tea consumption, by at-home and away from home usage, trended December 2014 to April 2016
Market Factors
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- US tea imports has steady rise
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- Figure 22: U.S. imports of tea and mate, 2010 to 2014
- iGeneration, Millennial populations have positive growth
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- Figure 23: Population by generation, percentage change, 2011-21
- Hispanic, Asian populations expect to see growth
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- Figure 24: Population by race and Hispanic origin, percent change, 2011-21
- Overlap between Millennials, acculturated Hispanics, and parents
- Millennials as parents
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- Figure 25: Households with own children, by age of householder, 2013
- Hispanics as parents
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- Figure 26: Households with own children, by Hispanic origin of householder, 2013
- Hispanics as Millennials
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- Figure 27: Generations, by Hispanic origin, 2016
Key Players – What You Need to Know
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- Leading companies experience MULO growth thanks to RTD teas
- RTD canned/bottled tea remains category segment leader
- Leading bagged tea brands struggle, affect overall segment sales growth
- Functionality, cold brews leading innovation opportunities
Company and Brand Sales of Tea and RTD Tea
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- Leading companies experience MULO growth thanks to RTD teas
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- Figure 28: MULO sales of tea, by leading companies, rolling 52 weeks 2015 and 2016
- Company and brand sales of tea and RTD tea
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- Figure 29: MULO sales of tea, by leading companies, rolling 52 weeks 2015 and 2016
What’s Working?
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- RTD canned/bottled tea remains category segment leader
- RTD refrigerated popularity continues to produce positive sales gains
- Kombucha continues to thrive
- English, herbal, and specialty bagged tea brands see growth
What’s Struggling?
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- Leading bagged tea brands struggle, affect overall segment sales growth
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- Figure 30: MULO sales of bagged/loose leaf tea, by leading companies and brands, rolling 52 weeks 2015 and 2016
- Keurig single-cup teas experience hefty sales losses
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- Figure 31: Total US retail sales and forecast Keurig cups, at current prices, 2011-21
What’s Next?
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- Functionality for all needs and occasions
- Packaging updates for RTD and brewed teas
- Matcha mania
- Brewed teas rebrand, redesign bagged/loose leaf offerings
- Premiumization hits in the form of flavors, tea house style drinks
- Preparation methods hit on current trends, consumer interaction
- RTD teas expand past black, white, and green tea varieties
The Consumer – What You Need to Know
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- Older Millennials consume greatest variety of teas
- 76% drink bagged/loose leaf tea
- Green tea leading brewed tea type
- Sugar, lemon, honey leading brewed tea additions
- One third believe in brewed teas’ long term, therapeutic health benefits
- Brand more important than natural, organic claims
- More than a quarter finds premium brewed teas worth the price
- More than a third of consumers drink RTD tea at least weekly
- Health benefits most important in RTD tea innovation
- Antioxidants leading functionality
- Bagged tea for relaxation, RTD tea for hydration
Multiple Tea Consumption
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- Older Millennials consume greatest variety teas
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- Figure 32: Repertoire analysis – Any RTD tea consumption, June 2016
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- Figure 33: Repertoire analysis – Any bagged/loose leaf tea consumption, June 2016
Brewed Tea Consumption
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- 76% drink bagged/loose leaf tea
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- Figure 34: Tea consumption – Bagged/loose leaf tea, June 2016
- Older Millennials heaviest consumers
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- Figure 35: Tea consumption – Bagged/loose leaf tea, by generation, June 2016
- Consumption increases among fathers
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- Figure 36: Tea consumption – Bagged/loose leaf tea, by parental status with/without children under 18 in the household, June 2016
- Hispanics, Asians over index for bagged/loose leaf/single cup tea
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- Figure 37: Tea consumption – Bagged/loose leaf tea, by race/ethnicity, June 2016
- Income influences consumption, premiumization
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- Figure 38: Tea consumption – Bagged/loose leaf tea, by income, June 2016
Brewed Tea Types and Attributes
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- Green tea leading tea type
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- Figure 39: Brewed tea types/attributes, June 2016
- Consumers drink multiple brewed tea types
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- Figure 40: Brewed tea types, by brewed tea types, June 2016
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- Figure 41: Brewed tea attributes, by brewed tea attributes, June 2016
- Women over index for majority of tea types
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- Figure 42: Brewed tea types/attributes, by gender, June 2016
- Older Millennials drive white, Roobios, mate tea consumption
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- Figure 43: Brewed tea types/attributes, by generation, June 2016
- Medicinal teas leading bagged/loose leaf type at natural channels
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- Figure 44: Natural supermarket sales of bagged/loose tea, by type, at current prices, rolling 52 weeks ending April 2016
Brewed-Tea Additions
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- Sugar, lemon, honey leading tea additions
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- Figure 45: Brewed tea additions, June 2016
- Consumers add in multiple additions
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- Figure 46: Brewed tea additions, by brewed tea additions, June 2016
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- Figure 47: Brewed tea additions, by brewed tea additions, June 2016
- Baby Boomers, women, Asians most likely to drink plain
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- Figure 48: Brewed tea additions – “I drink it plain”, June 2016
- Blacks, Hispanics over index for leading add-ins
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- Figure 49: Brewed tea additions, by race, June 2016
Attitudes toward Brewed Tea
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- One third believe in teas’ long term, therapeutic health benefits
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- Figure 50: Attitudes toward brewed tea – Health, June 2016
- Brand more important than natural, organic claims
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- Figure 51: Attitudes toward brewed tea – Brand and claims, June 2016
- More than a quarter find premium teas worth the price
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- Figure 52: Attitudes toward brewed tea – Packaging and attributes, June 2016
RTD Tea Consumption
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- More than a third of consumers drink RTD tea at least weekly
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- Figure 53: Tea consumption – Ready-to-drink (RTD) tea, June 2016
- Older Millennials and younger leading RTD tea consumers
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- Figure 54: Tea consumption – Ready-to-drink (RTD) tea, by generation, June 2016
- Fathers heaviest RTD tea consumers
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- Figure 55: Tea consumption – Ready-to-drink (RTD) tea, by parental status with/without children under 18 in the household, June 2016
- Hispanics drive RTD tea consumption
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- Figure 56: Tea consumption – Ready-to-drink (RTD) tea, by race/ethnicity, June 2016
RTD Tea Innovation
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- Health benefits most important in RTD tea innovation
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- Figure 57: Ready-to-drink tea innovation, June 2016
- Interest in RTD functionality declines with age
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- Figure 58: Ready-to-drink tea innovation, by generation, June 2016
- Fathers drive interest in RTD tea innovation
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- Figure 59: Ready-to-drink tea innovation, by parental status with child(ren) under 18 in the household, June 2016
Tea Functionality
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- Antioxidants leading functionality
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- Figure 60: Tea functionality, June 2016
- iGeneration drives interest in functional attributes
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- Figure 61: Tea functionality, by generation, June 2016
Drinking Occasions
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- Bagged tea for relaxation, RTD tea for hydration
- Brewed teas
- RTD teas
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- Figure 62: Tea drinking occasion, June 2016
Appendix – Data Sources and Abbreviations
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- Data sources
- Sales data
- Fan chart forecast
- Consumer survey data
- Abbreviations and terms
- Abbreviations
- Terms
Appendix – Market
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- Figure 63: Total US retail sales and forecast of canned/bottled tea, at current prices, 2011-21
- Figure 64: Total US retail sales and forecast of canned/bottled tea, at inflation-adjusted prices, 2011-21, 2011-21
- Figure 65: Total US retail sales and forecast of refrigerated tea, at current prices, 2011-21
- Figure 66: Total US retail sales and forecast of refrigerated tea, at inflation-adjusted prices, 2011-21
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- Figure 67: Total US retail sales and forecast of bagged/loose leaf tea, at current prices, 2011-21
- Figure 68: Total US retail sales and forecast of bagged/loose leaf tea, at inflation-adjusted prices, 2011-21
- Figure 69: US supermarket sales of tea and RTD tea, at current prices, 2011-16
- Figure 70: US convenience store sales of tea and RTD tea, at current prices, 2011-16
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- Figure 71: US sales of tea and RTD tea through other retail channels, at current prices, 2011-16
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Appendix – Key Players
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- Figure 72: MULO sales of canned and bottled tea by leading companies and brands, rolling 52 weeks 2015 and 2016
- Figure 73: MULO sales of refrigerated tea, by leading companies and brands, rolling 52 weeks 2015 and 2016
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- Figure 74: MULO sales of bagged/loose leaf tea, by leading companies and brands, rolling 52 weeks 2015 and 2016
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