Aside from tap water tea is the most popular drink in the UK according to Kantar, with 87% of households buying tea.

Besides being great for hydration and a good fit with healthy lifestyles, tea is good for sales too. Of everyone buying hot beverages, tea buyers are more likely to buy complementary products with their tea purchase. Milk, bread, cakes and biscuits are all perfect to enhance that time for me moment.

“Tea shoppers like brands, so it’s important to know the top sellers in each sector and ensure you stock these for your customers,” says Peter Dries, Director Of Customer And Shopper Marketing, Tata Global Beverages.

Tetley continues to have the highest number of buyers of all tea brands with buyer numbers up 3.2% (Kantar).

Overall value sales of tea have increased across a number of sectors within the tea category, value sales of everyday black decaf are up 6.4%; redbush up 3.6%, fruit and herbal up 4.8% and speciality up 10%.

Changes in consumer preference have impacted sales of everyday black teas, but this doesn’t mean that they have lost their importance. Core everyday black still accounts for around 78% of all teas sold, so remain a critical backbone of the category.

“Better returns will come from having a strong black tea offering, balanced by a mix of non-black teas selected to appeal most to your customers,” adds Dries.

Today the tea category is full of choice with a wide range of teas to suit all tastes, needs and moments.

“There are strong opportunities in tea. The challenge is to keep pace with changing tastes and what drives purchase and use this knowledge to adapt your tea range,” comments Dries. “Getting it right can result in greater sales and profits in tea and benefit sales in other categories too.”

Big brands account for just over 75% of total everyday black tea sales, so when making your selection consider the top brands that are selling most.

“It’s a good idea to complement every day black tea with a decaf option,” adds Dries. “Decaf drinkers won’t choose an alternative, so if one isn’t available, a sale won’t be made. With decaf taste is all important and Tetley is the dominant decaf brand.”

Tea shoppers are often looking for something a little bit different, whether a different taste experience or products that meet their desire for health. This is reflected in sales.

Tea’s good fit with health continues to be a draw. Impulse stores in particular are benefiting from this fit, with volume sales for speciality teas up 25% yoy, fruit and herbal up 9.2% and green up 2.5% (Nielsen).

Within Green, Tetley has 4 of the top 10 SKUs in Impulse including Tetley Pure Green 20s and Tetley Green and Lemon 20s – both are available in price mark packs of £1.49.

Tetley Super Green Boost with added vitamin B6 in Strawberry and Raspberry flavour and Tetley Super Green Immune with added vitamin C in Mango and Pineapple flavour are among the top 10 best sellers in Impulse and worth considering.

With more and more shoppers wanting to take the additional vitamins they need through their diet, functional food and drink with added vitamins has become a major trend.

Functional teas have become a big draw and are bringing something very different to the shelf.

Tetley Super teas have added vitamins and EFSA approved health claims, ranging from Immune System support to Reducing Tiredness and Fatigue.

The role of wholesalers to advise customers of the opportunities to grow tea sales is increasing in importance and a good partnership with manufacturers can be a real benefit here.

Tetley has a team dedicated to the wholesale channel working to guide depot managers on the best ways to stimulate sales and benefit from the growth areas in tea.

By sharing knowledge and understanding with its customers Tetley is working to affect positive change in the tea market.

Tetley’s support programme includes materials to market new teas and highlight margins to be made on RSP for different teas; high impact visual tools; marketing strategies and plans for optimum layouts for single and multiple bays; and separate plans for caterers and other out of home locations.

In January, PG tips, the nation’s favourite tea brand (Nielsen), launched a new brand purpose initiative ‘Cuppas Taste Better Together’ – its biggest campaign in five years. The Unilever brand is working alongside mental health, community and wellness charities, Samaritans, Time To Change and The Big Lunch, to help reduce loneliness by bringing people together over a cuppa.

With over nine million people in the UK feeling lonely according to British Red Cross, PG tips wants to inspire the nation to reach out and share a cuppa with those who may need a bit of extra company. The Cuppas Taste Better Together campaign will see activities throughout the year, and began with Samaritans’ ‘Brew Monday’ on Monday 20 January – which is cited as the most depressing day of the year, Blue Monday. This was followed by ‘Time to Talk Day’ on 6 February, with The Big Lunch planned for 6 – 7 June.

The campaign is being supported by a £3m media investment, including VOD, radio and social activations and a TV advertisement. This investment in the brand will help to drive sales and category growth for wholesalers – with heightened brand awareness throughout the year.

Fiachra Moloney, Tea Director, Unilever UK&I said: “There are at least 9 million people feeling lonely on any given day and we will all experience it at some point in our lives. We want everyone to be open in talking about loneliness, and at PG tips we know that something as simple as inviting someone for a cuppa can make a huge difference. We want our new TV, radio and social media campaign to help break the stigma around loneliness and encourage people to reach out to their friends, relatives and neighbours.”

Tea sales are soaring towards £329m with a growth of nearly 9% this year (Allegra) and consumer expectations for drinking their favourite beverage are increasing.

“Tea out of home needs to be premium and offer something different to a cuppa at home,” says Claire Fluen, Shopper Marketing Executive at Twinings Foodservice.

According to the Speciality Coffee Association (SCA), the top two most popular beverages in a coffee shop are a latte and tea, with the after-lunch slot of 1pm seeming to be the most well-liked time for a cuppa. “Operators need to capitalise on tea drinkers and provide an exceptional experience to encourage sales in this area,” suggests Fluen.

Recent research from Allegra found that giving consumers an individualised quality tea experience, just by letting them brew it exactly how they like it, generated around an extra £0.60p cash margin.

Taste is still the number one driver for purchase out of home and with consumers now driving the market towards a focus on health and wellbeing (24% intend to increase their tea consumption due to this according to Allegra), Twinings has responded with a new range for the foodservice sector – SUPERBLENDS.

For cafe operators, DIGEST and FOCUS are two perfect teas that are ideal for a breakfast, after lunch or mid-afternoon beverage. The new SUPERBLENDS help to overcome the barrier that many other healthy beverages face, great tasting drinks with the benefit of an added vitamin or mineral.

FOCUS would be a perfect morning or mid-afternoon drink with its mango and pineapple fruit tea with ginseng and added Vitamin B6 to help fight fatigue. As a drink after a meal, DIGEST offers a twist on the popular mint tea with a rooibos tea base, apple and Baobab and spearmint to support digestion.

With descriptive names such as DIGEST, FOCUS, CALM, GLOW and SLEEP customers will find it easy to understand the benefit of the product and select a tea that is perfect for their current need.

“Operators need to create an amazing tea event for customers, with adventurous serving styles, encouraging them to try new blends,” Fluen comments. “There’s been such a huge increase in competition in the tea space and operators have the opportunity to really drive sales in this area by offering an extensive range of specialty herbal and fruit teas alongside the more traditional black and green options.”

A fully displayed and prominently listed tea menu will encourage customer engagement and with many industry professionals believing that the most important trend affecting tea beverages out of home is healthier consumption driven by the increasing range of herbal and fruit teas available, it’s time for tea to take centre stage.

Coffee shop trends are leading both out of home and at home consumption.

Consumers are increasingly motivated to seek out a luxurious, quality experience and for the first time ‘indulgence’ has overtaken ‘functionality’ when it comes to coffee consumption, rising to 59.8% in 2019 (Allegra). Coffee trends in retail are led by demand in out of home coffee consumption, as consumers seek to bring the coffee shop experience to a quick, convenient home format.

Despite a demand from shoppers for more premium coffee types, such as pods, many retailers are failing to stock this (HIM).

“Stocking a full range of coffee solutions is key to reach all customers to suit their coffee needs,” says Martyn Bell, Category Marketing Manager – Convenience Coffee, Jacobs Douwe Egberts. “Consumers are looking for quality experiences in convenient formats.”

Single serve coffee penetration has also continued to increase, with value sales seeing growth of +27.1% MAT in the impulse channel vs last year (Nielsen).

The flat white is the fastest growing beverage in coffee shops and cafés in the UK to 53%, with cold brew also growing fast with a significant rise of 34% (Allegra).

“With the growth of iced beverages and speciality coffee in the out of home market, both retailers and wholesale managers should be updating their stock to tap into these consumer trends,” advises Bell.

In high street coffee shops, latte remains the number one menu choice accounting for 57% of the market, followed closely by Americano at 26.1% and Cappuccino at 33.8% (Allegra).

This demand for speciality style coffees has led to the development of the fast-growing category of “Instant Speciality” coffees, combining the simplicity of instant coffee with the indulgence of a luxurious latte, or frothy cappuccino.

“This opens up a fantastic opportunity for traditional ‘black or white’ coffee caterers to add value into the category by offering a range of indulgent instant speciality coffees, which only need a kettle to prepare,” adds Bell.

With Kenco speciality ranging from 750g to 1.2kg catering tins, Jacobs Douwe Egberts has extended its offering to support operators without the time or space for a machine, to offer an indulgent, high quality, frothy coffee.

“Kenco Cappuccino and Latte are part of the range, adding on-trend strength to any hot beverage menu,” claims Bell. “Offering independent caterers and operators the ability to serve the coffee shop style beverages consumers are looking for – with the quality assurance of the respected Kenco brand.”

Kenco Instant Specialities are massively outperforming in retail, experiencing double-digit value sales growth of +31.3% in the MAT (Nielsen).

This demonstrates a continued demand for frothy, indulgent styles in a convenient offering and, coupled with a rapidly growing interest in the Cold and Iced Coffee category that saw iced coffee becoming the sixth most popular drink ordered in coffee shops (Allegra).

Available from April, the Kenco Instant Specialities range is growing with the addition of two new variants 1kg Instant Flat White and 1.2kg Instant Iced Latte.

Recognising that 82% of small businesses already have access to a kettle (Datlinq), the Kenco ‘coffee shop favourites’ catering range will make it possible for operators to introduce and emulate full coffee indulgence in out of home environments to venues with more limited capacity. The specialities range enables operators to serve a selection of the top five coffee shop favourite coffee drinks.

“Coffee trends in retail are led by demand in out of home coffee consumption, as consumers seek to bring the coffee shop experience to a quick, convenient home format,” suggests Bell. “Stocking a full range of coffee solutions is key to reach all customers to suit their coffee needs.”

Merchandising stock by sub-category is an effective technique increasing visibility of products is key to increasing demand, for example through POS/ ads in depot. With the fast-paced nature of the hot beverage category, it is important that operators keep on top of the ever-changing trends within the out of home market.

“There’s a genuine opportunity for outlets and shops of all kinds to maximise the opportunity by better meeting the needs of consumers,” Bell believes. “To maximise sales further, it’s important that wholesalers provide a selection of top-quality products, and offer variation to cater to a selection of coffee preferences, boosting overall sales and giving consumers more to choose from. With more than 265 years’ coffee expertise, Jacobs Douwe Egberts knows and understands the category and can advise wholesalers on the latest trends and consumer preferences.”

The £2.2bn Hot Beverages category continues to see strong growth with a 5 year CAGR of +2.1% in Value, led by Coffee (+3.8%), Hot Chocolate saw decline (-1.6%) according to IRI and Kantar.

Premiumisation has been a key driver of success as consumers continue to seek better quality cups at home and more convenient solutions.

Coffee has a 62% share of Hot Beverages sales and historically tea has always taken the largest share of cups (51% in 2019), but this is set to change very soon. Tea volumes are down -2.6% (5 year CAGR), while Coffee is up 1.4%. If these trends are extrapolated, coffee volumes will overtake tea within the next 2 years.

Taka Ota, Senior Brand Manager at Nestle, comments: “The UK is becoming a nation of coffee lovers and wholesalers should review their ranges to ensure they stock the right balance of coffee options in light of this behaviour change and to take advantage of the premiumisation that coffee can bring to the category.”

Within tea it is Everyday Black tea that is driving the decline, with Value -4.9% in 2019. Green tea also saw decline at -5.0% in Value, while fruit and herbal tea delivered some growth at +3.9%, with consumers valuing the added health benefits that this segment can offer. Cold tea infusions also delivered growth, but from a small base.

Soluble coffee accounts for 60% of in-home coffee sales and saw volume growth of 0.7% in 2019. NESCAFÉ accounts for 50.3% of this segment across its range of sub brands, up by 50 base points YoY. While pure soluble coffee (black coffee, typically sold in jars or tins) provided volume growth +0.5% in 2019, soluble mixes (white coffee, typically sold in convenient sachets) drove value at +1.9%, selling at a much higher pence per cup than pure soluble.

Within pure soluble coffee, NESCAFÉ Original is the nation’s favourite soluble coffee by volume and sold 3.7bn cups in 2019. NESCAFÉ Gold is the biggest selling coffee brand by value, worth £145m +2.5% YoY. NESCAFÉ Azera is the UK’s favourite Super Premium coffee, worth £56.8m and with over 1bn cups sold in 2019. NESCAFÉ Gold Origins also saw strong growth (Volume +15.5%) in 2019 with an expanding range of products that is right on the trend for provenance within food and drink.

Ota added: “Wholesalers should also ensure they stock a range of Price-Marked-Packs (PMPs) for convenience store customers. According to HIM* 42% of convenience store shoppers buy PMPs and 44% would be more likely to shop in a local that stocks them. PMPs are particularly important to London and younger shoppers 25-34. Shoppers value clear pricing in stores.”

Soluble Mixes’ volume growth of 5.8% was driven by NESCAFÉ (+7.4%) in 2019. The range of NESCAFÉ Gold frothy coffees continued to go from strength to strength with the addition of NESCAFÉ Gold Dairy Alternative Lattes. Available in Almond, Oat and Coconut, the new range fulfils a growing consumer need for non-dairy. 7m UK households buy milk alternative products, of which 84% do so as part of a lifestyle choice, rather than due to intolerances. Convenient NESCAFÉ Original In1’s also show growth.

Coffee Pods continue to become an increasingly important part of the coffee market, now worth £235m, +5.7% YoY and with a 16% share of total coffee. Furthermore, as we continue to see the rise of artisanal coffee shops out of home, growth of the Roast and Ground segment (Value +5.2% in 2019) is evidence of consumers’ desire to recreate the same quality, freshness and variety at home. The addition of the Starbucks range to the NESTLÉ portfolio in 2019 across Roast and Ground, Starbucks by NESCAFÉ Dolce Gusto and Starbucks by Nespresso has allowed consumers to enjoy the premium coffee shop taste at home.

Ready to Drink Cold Coffee is the fastest growing segment within the Soft Drinks category in +29% value growth in 2019. This reflects trends seen in coffee shops of younger consumers buying into cold coffee and coffee on the go formats. Ready To Drink Coffee is predicted to be the fastest growing segment in the next 3 years, growing +69% by 2023, and Ready to Drink Coffee £sales contribution in Convenience will be more than 10x that of Ambient coffee by 2023 (HIM!). NESCAFÉ Azera Nitro RTD now comes in three flavours – Latte, Double Shot Flat White and Salted Caramel, all of which are 94 calories or under (IRI). To support this, there is a multi-million pound brand investment.

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