Tea and Ready-to-Drink Tea in the U.S., 4th Edition

Chapter 1: Executive Summary

Scope and Methodology

Scope of Report

Report Methodology

Varieties of Tea

Market Trends

Tea Grow Despite Tough Economy

Table 1-1: U.S. Retail Sales of Tea, 2007-2011 (in millions of dollars)

Supermarkets at 28% Share

Table 1-2: Share of U.S. Retail Sales of Packaged Tea by Channel, 2011 (percent)

SymphonyIRI-tracked Sales Show Solid Growth

Table 1-3: SymphonyIRI-tracked Sales of Tea: Overall and by Segment, June 2011 (dollars and volume)

RTD Tea Going Strong in Natural Foods Channel

Table 1-4: Sales of Leaf and RTD Tea Products in Natural Supermarket Channel, 2009-2011

Varieties of Tea Purchased by Type

Table 1-5: Tea Drinkers by Types of Tea Purchased, 2011

Tea Is Good For You, But Be Careful How You Say That

All’s Fair in the Tea Trade

Merger Mania

K-Cup Craze

How Sweet It Is for Foodservice

More Robust Tea Sales Growth on the Horizon

Table 1-6: Projected U.S. Retail Sales of Tea, 2011-2016 (in millions)

The Marketers

The Power of Tea Concentrated Among a Few

Table 1-7: Top Marketers of Tea at Food, Drug and Mass Merchandisers, 2010-11 (dollar sales and market share)

Many Big Players in Foodservice

Tea Retailers Take Center Stage

New Product Trends

Tea Leads All Beverages in Innovation

Tea Begins Rebound from Recessionary Lows

Table 1-8: Number of U.S. Tea Product Introductions: Reports and SKUs, 2007-2011

“Natural” the Top Claim, “Upscale” Recedes

Table 1-9: Top Marketing Claims/Package Tags for U.S. Tea Product Introductions: 10-year vs. 1-year Trend for Period Ending July 2011

Marketers Emphasize Functional Benefits

Kombucha Creates a Stir

New Products from Celebri-Teas

Foodservice Chains Bet Big on Tea

Consumer Trends

Tea Remains a Consumer Favorite

Figure 1-1: Household Purchasing of Retail Tea Products, 2010 (percent and number)

Table 1-10: U.S. Households Purchasing Retail Tea Products, 2006-2010 (number in millions and percent)

Regular vs. Decaf

Figure 1-2: Household Purchasing of Leaf Tea: Regular vs. Decaffeinated and Bagged vs. Loose, 2010 (percent)

41% of Households Buy Lipton Leaf Tea

Figure 1-3: Top Brands of Leaf Tea by Household Purchasing Levels, 2009 (percent)

Purchasing Patterns Emerge

Chapter 2: Market Trends

Retail Market Size and Composition

Retail Tea Sales Rise to $6.5 billion

Table 2-1: U.S. Retail Sales of Tea, 2007-2011 (in millions of dollars)

A Multi-Channel Champion

Table 2-2: Share of U.S. Retail Sales of Packaged Tea by Channel, 2011 (percent)

SymphonyIRI-tracked Sales Show Solid Growth

Table 2-3: SymphonyIRI-tracked Sales of Tea: Overall and by Segment, June 2011 (dollars and volume)

RTD Tea Going Strong in Natural Foods Channel

Table 2-4: Sales of Leaf and RTD Tea Products in Natural Supermarket Channel, April 2009 - April 2011

Medicinal Tea Leads the Leaf Tea Category

Table 2-5: Sales of Leaf Tea in the Natural Supermarket Channel, April 2009 - April 2011 (dollars)

Tea Remains One of the Beverage Industry’s Bright Spots

Table 2-6: Beverage Dollar Sales and Market Share by Category, June 2011

Table 2-7: Fastest-Growing Beverage Categories, June 2011

Foodservice Composition

House Wine of the South Spurs Foodservice Growth

“Money in a Cup”

Foodservice Fast Facts

Vending a Key Tea Channel

Fast-Growing Tea Companies

Tea Behaviors

Varieties of Tea Consumed and Single-Serve Purchase Behavior

Table 2-8: Tea Drinkers by Types of Tea Purchased, 2011

Market Dynamics

FDA Cracks Down

Health Studies Abound

Fair Trade Shows Big Jump

Tea Companies Marry and Divorce

Single Cup Platforms Become New Growth Drivers

Tea Marketers Get Creative

Tea 2.0

Looking Ahead

More Robust Tea Sales Growth on the Horizon

Table 2-9: Projected U.S. Retail Sales of Tea, 2011-2016 (in millions)

Chapter 3: The Marketers

Competitive Overview - Packaged Goods

A Handful of Marketers Dominate

Table 3-1: Leading Marketers of Tea at Food, Drug and Mass Merchandisers, April 2011 (dollar sales and market share)

Lipton Has Leaf Tea in the Bag

Table 3-2: Top Marketers and Brands of Bags/Loose Tea by SymphonyIRI-tracked Sales and Volume, April 2011

RTD Marketers Forge Ahead

Table 3-3 Top Marketers and Brands of RTD Tea by SymphonyIRI-tracked Sales and Volume, April 2011

Instant Provides Little Gratification

Table 3-4: Top Marketers and Brands of Instant Tea by SymphonyIRI-tracked Sales and Volume, April 2011

Refrigerated Tea Makes a Case for Itself

Table 3-5: Top Marketers and Brands of Refrigerated Tea by SymphonyIRI-tracked Sales and Volume, April 2011

Competitive Overview - Foodservice

Many Foodservice Tea Suppliers

Competitive Overview - Tearooms and Specialty Stores

A Highly Fragmented Market

The Teavana IPO

Table 3-6: Teavana’s product mix, 2009-2011

The Marketing of Teavana

Chapter 4: Brand Profiles

AriZona (AriZona Beverage Co.)

A Leader in RTD

Growing and Sought After

Capitalizing on a Legendary Golf Drink

Caught in an Immigration Controversy

AriZona Expands Its Packaging Options

A Straightforward Strategy

Bigelow Tea (R.C. Bigelow, Inc.)

A Constant Contender

Partnering with The Great One

Healthy Introductions Abound

Celestial Seasonings (The Hain Celestial Group)

Herbal Leader Experiences Solid Growth

Celestial Seasonings and K-Cups

Couponing, In-store and Social Media

Gold Peak (The Coca-Cola Company)

Pushing for More Share

New Packaging and Delivery Systems Drive Growth

Lipton (Unilever and PepsiCo)

Despite Weak Sales, Lipton Still Dominates

How Pepsi-Lipton Segments the RTD Market

Brisk Takes on the Year’s Biggest Audience

Partnering with Green Lantern and Stickybits

New Products Make a Splash

Nestea (Coca-Cola and Nestlé)

Slipping Sales in RTD

Nestea Emphasizes Online

Red Diamond

Rising Star in Refrigerated Tea

Snapple (Dr. Pepper Snapple Group)

A Turnaround Story

The Northeast Is Snapple’s Stronghold

The Importance of Packaging

Capitalizing on TV Tie-Ins

Turkey Hill

The Big Chilled

Twinings

By Appointment to Her Majesty

Chapter 5: New Product Trends

Overview

Tea Product Launches Pace All Categories

Table 5-1: Number of U.S. Non-Alcoholic Beverage Product Reports/SKUs, July 2011

Tea Begins Rebound from Recessionary Lows

Table 5-2: Number of U.S. Tea Product Introductions: Reports and SKUs, July 2007 - July 2011

What’s in a Claim?

Table 5-3: Top Marketing Claims/Package Tags for U.S. Tea Product Introductions: 10-year vs. 1-year Trend for Period Ending July 2011

Packed Full of Flavors

Table 5-4: Top Flavors in U.S. Tea Product Introductions: 10-years vs. 1-year Trend for Period Ending July 2011

Same Players Introduce New Products

Table 5-5: Top Companies in U.S. Tea Product Introductions, July 2001 - July 2011

Table 5-6: Top Companies in U.S. Tea Product Introductions, July 2011

Packaged Goods Trends

Functional Benefits Popular in New Tea

Coca-Cola’s “Teavolution of Water”

The Curious Case of Kombucha

Bigelow’s Healthy Offerings

Could’ve Had a V8

Tulsi Touches Down

Celebrities Jump on the Tea Bandwagon

My Country Tis of Tea

New Product Trends in Foodservice

The Big Chains Emphasize Tea

Starbucks Gets Bigger

Teavana Unveils New Teas for the 2010-11 Season

Popeyes Gets Sweet

Other New Products Debut in Foodservice

Notable Products at the World Tea Expo

2011 World Tea Expo Best New Product Award Winners

Tea as an Ingredient Winner (Tie)

TEAS' TEA Low-Calories by ITO EN

Packaging Winner (Tie)

Tiesta Tea Tins by Planet Canit

Packaging Winner (Tie)

C+SWISS by Chill Drinks

Innovation Winner

Drip Tea by Sugimoto America, Inc

Open Class Winner (Tie)

Chaitea by Gourmetti Brands Inc.

Open Class Winner (Tie)

Incredible Lid V2 for Hot Beverage by Idea House International, Inc.

Chapter 6: Consumer Trends

Overview

Note on Experian Simmons and Packaged Facts Surveys

Household Purchasing Rates for Retail Tea Products

Figure 6-1: Household Purchasing of Retail Tea Products, 2010 (percent and number)

Table 6-1: U.S. Households Purchasing Retail Tea Products, 2006-2010 (number in millions and percent)

Retail vs. Restaurant Purchasing Rates

Figure 6-2: Tea Drinker Purchasing Patterns: Retail vs. Restaurant, February 2009 (percent)

Figure 6-3: Tea Drinker Purchasing Patterns: Retail or Restaurant Purchasing Patterns for Selected Specialty Tea Products, February 2009 (percent)

Consumer Demographics and Psychographics: Leaf Tea

Overall Usage Patterns for Leaf Tea

Table 6-3: Demographic Indicators for Purchasing Leaf Tea, 2010 (percent, total number and index)

Table 6-4: Household Usage of Leaf Tea by Purpose: Hot Tea vs. Iced Tea, 2010 (percent and number)

Hot vs. Iced Tea

Table 6-5: Select Demographic Indicators for Purchasing Leaf Tea to Make Hot Tea, 2010 (percent, total number and index)

Table 6-6: Psychographic Indicators for Using Leaf Tea to Make Hot Tea, 2010 (percent, total number and index)

Table 6-7: Demographic Indicators for Purchasing Leaf Tea to Make Iced Tea, 2010 (percent, total number and index)

Table 6-8: Psychographic Indicators for Purchasing Leaf Tea to Make Iced Tea, 2010 (percent, total number and index)

Bagged vs. Loose Tea

Table 6-9: Household Purchasing of Leaf Tea by Type: Bagged vs. Loose, 2010 (percent and total number)

Table 6-10: Demographic Indicators for Using Bagged Tea, 2010 (percent, total number and index)

Table 6-11: Demographic Indicators for Using Loose Leaf Tea, 2010 (percent, total number and index)

Table 6-12: Psychographic Indicators for Purchasing Loose Leaf Tea, 2010 (percent, total number and index)

61% of Households Buy Regular Tea

Table 6-13: Household Purchasing of Leaf Tea: Regular vs. Decaffeinated, 2009 (percent and total number)

Figure 6-4: Household Purchasing of Leaf Tea: Regular vs. Decaffeinated and Bagged vs. Loose, 2010 (percent)

Flavor Preferences

Table 6-14: Household Purchasing of Leaf Tea by Flavor, 2010 (percent and total number)

Figure 6-5: Retail Tea Purchasing Patterns by Flavor, February 2009 (percent)

Figure 6-6: Restaurant Tea Purchasing Patterns by Flavor, February 2009 (percent)

Regular Blend Drinkers

Table 6-15: Demographic Indicators for Flavors Used: Regular Blend Tea, 2010 (percent, total number and index)

Green Tea Drinkers

Table 6-16: Demographic Indicators for Flavors Used: Green Tea, 2010 (percent, total number and index)

Table 6-17: Pyschographic Indicators for Flavors Used: Green Tea, 2010 (percent, total number and index)

Herbal Tea Drinkers

Table 6-18: Demographic Indicators for Flavors Used: Herbal Tea, 2010 (percent, total number and index)

Table 6-19: Pyschographic Indicators for Flavors Used: Herbal Tea, 2010 (percent, total number and index)

Fruit/Spice-Flavored Tea Drinkers

Table 6-20: Demographic Indicators for Flavors Used: Fruit/Spice-Flavored Tea, 2010 (percent, total number and index)

Table 6-21: Pyschographic Indicators for Flavors Used: Fruit/Spice-Flavored Tea, 2010 (percent, total number and index)

14% of Households Are Heavy Consumers of Leaf Tea

Table 6-22: Household Consumption Levels for Leaf Tea, 2010 (percent and total number)

Table 6-23: Demographic Indicators for Heavy Household Consumption of Leaf Tea, 2010 (percent, total number and index)

Table 6-24: Psychographic Indicators for Heavy Consumption of Leaf Tea, 2010 (percent, total number and index)

41% of Households Buy Lipton Leaf Tea

Figure 6-7: Top Brands of Leaf Tea by Household Purchasing Levels, 2009 (percent)

Table 6-25: Demographic Indicators for Purchasing Leaf Tea: By Brand, 2010 (index)

Table 6-26: Psychographic Indicators for Purchasing Leaf Tea: By Brand, 2010 (index)

Consumer Demographics and Psychographics: Ready-To-Drink Cold Tea

45% of Households Purchase RTD Cold Tea

Figure 6-8: Household Purchasing of RTD Cold Tea, 2010 (percent and number)

Table 6-27: Demographic Indicators for Purchasing RTD Cold Tea, 2010 (percent, total number and index)

Table 6-28: Psychographic Indicators for Purchasing RTD Cold Tea, 2010 (percent, total number and index)

Regular vs. Diet RTD Tea

Table 6-29: Demographic Indicators for Purchasing Regular RTD Cold Tea, 2010 (percent, total number and index)

Table 6-30: Psychographic Indicators for Purchasing Regular RTD Cold Tea, 2010 (percent, total number and index)

Table 6-31: Demographic Indicators for Purchasing Diet RTD Cold Tea, 2010 (percent, total number and index)

Table 6-32: Psychographic Indicators for Purchasing Diet RTD Cold Tea, 2010 (percent, total number and index)

22% of Households Buy RTD Lipton

Figure 6-9: Top Brands of RTD Cold Tea by Household Purchasing Levels, 2010 (percent)

Patterns by Brand

Table 6-33: Demographic Indicators for Purchasing RTD Cold Tea: By Brand, 2010 (index)

Table 6-34: Psychographic Indicators for Purchasing RTD Cold Tea: By Brand, 2010 (index)

Consumer Demographics and Psychographics: Instant Iced Tea Mix

27% of Households Buy Instant Iced Tea Mix

Figure 6-10: Household Purchasing Instant Iced Tea Mix, 2010 (percent and number)

Table 6-35: Demographic Indicators for Using Instant Iced Tea Mix, 2010 (percent, total number and index)

Table 6-36: Psychographic Indicators for Using Instant Iced Tea Mix, 2010 (percent, total number and index)

Patterns by Sweetened/Unsweetened Formula Type

Table 6-37: Demographic Indicators for Using Sugar-Sweetened Instant Iced Tea Mix, 2010 (percent, total number and index)

Table 6-38: Psychographic Indicators for Using Sugar-Sweetened Instant Iced Tea Mix, 2010 (percent, total number and index)

Table 6-39: Demographic Indicators for Purchasing Unsweetened Instant Iced Tea Mix, 2010 (percent, total number and index)

Table 6-40: Psychographic Indicators for Using Unsweetened Instant Iced Tea Mix, 2010 (percent, total number and index)

Table 6-41: Demographic Indicators for Purchasing Sugar-Free Sweetened Instant Iced Tea Mix, 2010 (percent, total number and index)

Table 6-42: Psychographic Indicators for Using Sugar-Free Sweetened Instant Iced Tea Mix, 2010 (percent, total number and index)

6% of Households Are Heavy Consumers of Instant Iced Tea

Figure 6-11: Household Consumption Levels for Instant Iced Tea: Number of Glasses, 2010 (percent and total number)

Table 6-43: Demographic Indicators for Heavy Household Consumption of Instant Iced Tea, 2010 (percent, total number and index)

Table 6-44: Psychographic Indicators for Heavy Consumption of Instant Iced Tea, 2010 (percent, total number and index)

13% of Households Buy Lipton Instant Iced Tea

Figure 6-12: Top Brands of Instant Iced Tea Mix by Household Purchasing Levels, 2010 (percent)

Table 6-45: Demographic Indicators for Purchasing Instant Iced Tea Mix: By Brand, 2010 (index)

Table 6-46: Psychographic Indicators for Using Instant Iced Tea Mix: By Brand, 2010 (index)

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