Table of Contents
Executive Summary
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- The market
- A steep growth followed by a slow increase in value
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- Figure 1: Best- and worst-case forecast for tea shop drinks, by value, 2013-23
- A steady growth in volume
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- Figure 2: Best- and worst-case forecast for tea shop drinks, by volume, 2013-23
- Social media boosts new products promotion and sales
- Companies and brands
- Brands with varied status have different strategies
- Natural sweeteners get a chance in tea shop drinks
- Innovating by providing extra benefits
- The consumer
- More heavy users prefer offline purchase channels
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- Figure 3: Frequency and channels, China, August 2018
- Consumers with moderate consumption frequency prefer online channels
- Milk tea is the mainstream product followed by fresh juice
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- Figure 4: Product penetration, China, August 2018
- More people consume tea shop drinks when going out shopping
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- Figure 5: Consumption occasions, China, August 2018
- Bright prospect for work occasion
- Taste is essential for tea shop drinks followed by variety and price
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- Figure 6: Purchasing triggers, China, August 2018
- Fresh and natural ingredients motivate people to pay more
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- Figure 7: Premium factors of products, China, August 2018
- Spin-offs have the potential to generate incremental revenue
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- Figure 8: Attitudes towards tea shops, China, August 2018
- What we think
Issues and Insights
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- Younger consumers like blended drinks while older like pure drinks
- The facts
- The implications
- Potential collaboration with different service shops
- The facts
- The implications
- IP collaboration has potential to enlarge consumer scope
- The facts
- The implications
The Market – What You Need to Know
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- The market will keep growing
- Social media is the key marketing platform
- Freshness and nutrition stimulate consumption
Market Size and Forecast
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- Slow value growth in five years
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- Figure 9: Best- and worst-case forecast for tea shop drinks, by value, 2013-23
- Steady volume growth
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- Figure 10: Best- and worst-case forecast for tea shop drinks, by volume, 2013-23
Market Drivers
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- High frequency of product innovation
- Short video platforms help boost sales
- Nourishing body is deeply rooted in consumers’ daily lives
Key Players – What You Need to Know
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- Leading and smaller brands have different focuses
- Marketing strategies target female consumers
- Health always takes vital place in consumers’ minds
Competitive Strategies
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- Leading brands put efforts beyond the core products
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- Figure 11: Using fashion elements, by HEYTEA, China, 2018
- Figure 12: Enzymes and Seven-day tea leaves, by inWe, China, 2018
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- Figure 13: Membership card, by NAYUKI, China, 2018
- Figure 14: Innovative eating ways, by NAYUKI, China, 2018
- Crossover marketing
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- Figure 15: HEYTEA with Marie Dalgar and Pechoin, China, 2018
- Desserts enrich consumers’ experience in tea shops
- Secret menu drives curiosity
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- Figure 16: Hidden menu posted on Red by individual based on personal experience, China, April 2018
- Smaller brands concentrating on developing new products
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- Figure 17: Flowing shimmers in drink with natural ingredients, by Juice Cubi, China 2018
- Figure 18: Grapefruit enzyme rose cup, by Oritea, China, 2018
- Eye-catching is the key to become internet-famous
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- Figure 19: Northern lights, by The Alley, China
- Figure 20: Milk tea in perfume bottle, by TRIPLE P, China, 2018
- Figure 21: Window display borrowed idea from clothing and accessories, by KOI The, China
Who’s Innovating?
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- Using stevia instead of sugar
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- Figure 22: Stevia with fewer calories, by HEYTEA, China, 2018
- Chinese herbal functional tea for nourishing
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- Figure 23: BALANCE Lotus leaf Detox water, by Yan Yue Shan, China
- Figure 24: Donkey-hide gelatine and jujube milk tea, by Yan Yue Shan, China
- Figure 25: Freshly boiled donkey-hide gelatine and jujube milk tea, by Yan Yue Shan, China
- Drink for beauty
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- Figure 26: Rose water with Lumi collagen, by Yan Yue Shan, China
- Pairing with light meals or being meal replacements
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- Figure 27: Tea shop drink made of taro, brown rice and oat grain, by Mi Dou You Liao, China 2018
The Consumer – What You Need to Know
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- Opportunities in associating with working occasion
- Nut milk drinks have potential to grow further
- Premiums for consumers aged 30-49
Tea Shop Visiting Frequency
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- People visit physical stores more often than order online with one exception
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- Figure 28: Frequency and channels, China, August 2018
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- Figure 29: Purchase channels and frequency – less than once a month, by monthly personal income, China, August 2018
- Figure 30: Purchase channels and frequency – 1-3 times a month, by gender and age, China, August 2018
- Heavy users prefer to buy offline
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- Figure 31: Purchase channels and frequency – 3-4 times a week, by age, China, August 2018
- Figure 32: Purchase channels and frequency – 3-4 times a week, by region, China, August 2018
- More heavy users in tier one cities than lower tier cities
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- Figure 33: Consumption frequency and channels, by city tier, China, August 2018
Product Penetration
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- Milk tea has the highest penetration rate
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- Figure 34: Product penetration, China, August 2018
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- Figure 35: Penetration of milk tea, by city, China, August 2018
- Nut milk drinks have a strong growing momentum
- Consumers aged 18-29 and 30-49 have differences in choosing tea shop drinks
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- Figure 36: Product penetration, by age, China, August 2018
Consumption Occasions of Tea Shop Drinks
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- Shopping offline and hanging out are the main consumption occasions
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- Figure 37: Consumption occasions, China, August 2018
- Consumption occasions affect the purchase channels
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- Figure 38: Consumption occasions, by channels and frequency – less than once a month, China, August 2018
- More tier one cities’ residents have bought tea shop drinks at work
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- Figure 39: Consumption occasions, by city tier, China, August 2018
- Figure 40: Drinks from tea shops consumed in working occasion, by selected city tier, China, August 2018
- Popular tea shop drinks in entertainment occasions
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- Figure 41: Selected consumption occasions, by city tier, China, August 2018
Purchasing Triggers
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- Taste determines consumers’ purchase choice
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- Figure 42: Purchasing triggers, China, August 2018
- Not desired third place at present
Premium Factors of Products
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- Innovative flavours encourage more than half of consumers to pay more
- Freshness and naturalness are always the key things
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- Figure 43: Premium factors of products, China, August 2018
- Characteristics of premium tea drinkers
Attitudes towards Tea Shops and the Drinks
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- Half of consumers will not queue for hours...
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- Figure 44: Attitudes towards tea shops, China, August 2018
- …but females will queue for nut milk drinks
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- Figure 45: Selected attitudes towards tea shop drinks, by gender and product type, China, August 2018
- Two thirds of consumers like to buy spin-offs from tea shops
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- Figure 46: Attitudes towards tea shops, China, August 2018
- Most consumers think tea shops are good places for meeting up
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- Figure 47: Attitudes towards tea shops, China, August 2018
Meet the Mintropolitans
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- Tea shop drinks are indispensable for most Mintropolitans
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- Figure 48: Attitudes towards drinks from tea shops, by consumer classification, China, August 2018
- Figure 49: Consumption occasions, by consumer classification, China, August 2018
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- Figure 50: Attitudes towards drinks from tea shops, by consumer classification, China, August 2018
- Figure 51: Attitudes towards drinks from tea shops, by consumer classification, China, August 2018
- Mintropolitans have more requirements from drinks from tea shops
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- Figure 52: Purchase triggers, by consumer classification, China, August 2018
- Figure 53: Attitudes towards drinks from tea shops, by consumer classification, China, August 2018
Appendix – Market Size and Forecast
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- Figure 54: Sales value of tea shop drinks, China, 2013-23
- Figure 55: Sales volume of tea shop drinks, China, 2013-23
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Appendix – Methodology and Abbreviations
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- Methodology
- Fan chart forecast
- Abbreviations
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