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World Tea News asked tea industry influencers about tea trends in 2019. Here are their insights.
We have experienced significant shifts in the premium tea market since starting The Tea Spot almost 15 years ago. During the past one-two years, we are witnessing a strong dichotomy in tea buying habits. Whereas previously the market showed strong preferences for traditional breakfast blends and flavored black teas with some steady growth in the green tea category, we now see the most significant expansion coming from two very distinct market segments: functional botanical blends and single estate artisanal teas.
The rise of the educated tea consumer
This latter segment points to the evidence of a more educated consumer base, something which was previously limited to a smaller number of higher end tea connoisseurs. Our sales of pure single estate organic teas have increased more rapidly than other categories. Many of these are amongst our pricier selections, which used to have difficulty gaining traction against more affordable lower end teas. While 3rd wave coffeeshops are educating their clientele on origin and terroir, so are we as a specialty tea retailer, with premiumization. Our newer tea customers crave authenticity and the story which can connect them to the tea masters who craft our top shelf, traditionally produced teas.
Continued trend of tea as a healthy beverage
Our other major source of growth is in functional botanical tea and herbal blends. This comes as no surprise to anyone who scans the grocery shelves regularly for tea trends. There are almost no single estate teas to be found in grocery any longer, no matter how upscale the store. In fact, the more premium the retail shopping environment, the higher the likelihood of finding only functional blends. This trend shows that the consumer’s desire for tea to make them feel better, ward off ills or manage stress and energy levels continues to be a major driver in the market. This transition from traditional specialty to more of a lifestyle view of tea in retail dovetails with trends in wellness, self-care and yoga.
Green tea was a rarity in the U.S. and had never even been tasted by most Americans when I started our business in 2004. Many of those who had tried a cup of green tea hadn’t enjoyed the experience, and didn’t care to repeat it, as it was poorly prepared more often, than not. Then came the emergence of the tea health wave, which significantly spurred the acceptance of green tea. Blended and flavored green tea products, which were easier on the American palate, multiplied. Green tea sales soared in the latter part of the first decade of the new millennium. Matcha, a powdered green tea which quickly developed a reputation for even stronger health benefits as well as promises of natural cleansing and weight loss, followed on its heels experiencing a significant growth spurt over the past decade. What started as a fad has since left green tea and matcha as staples in the tea market, where they comprise more than 10 percent of overall specialty tea sales.
Digging down a level deeper in the analysis of what we saw in 2018 and making some predictions for trends 2019, here are some additional characteristics we’ve observed in consumer behavior this past year: For many, the natural sweetness in tea is not enough. Flavored teas are very popular. People may choose tea because it’s an unsweetened beverage, but still want something that tastes like it’s sweetened. Not only are bold flavors in favor, but color draws consumers as well. It’s interesting how often a beautiful, deep color of a tea can influence a customer’s selection. Tea in 2019 might not strongly resemble your grandma’s cup of tea, but many consumers are drawn to either classical or fanciful tea blends which remind them of something from their childhood.
The main reasons we see customers looking for functional teas are to help with inflammation, digestion and cleansing, energy management (either for a lift to aid in sleep) and to release stress. Probiotic teas make up a very small fraction but are growing rapidly. Plant power is going strong, with new herbs and even vegetable ingredients being added as well as ayurvedic and adaptogenic blends using moringa, ashwagandha, maca and funghi.
Starbucks-Teavana closed their 300+ tea retail stores across the country this past year. What’s left of their brand includes almost no pure and unsweetened teas, and the Teavana brand is now synonymous with craft blended and sweetened iced teas. Innovation in both iced tea recipes and delivery is strong, as well as tea being used as an ingredient in artisanal sparkling drinks, mocktails, cocktails and craft beer. Consumers are interested in recipes which use tea as an ingredient, and in adapting these to their own functional needs and culinary tastes.
Cold brewing is still a trend on the rise. Tea as a flavor and functional enhancement to water is changing the face of healthy hydration. We have seen a shift in our Steepware sales from more traditional teaware to water bottles and hydration flasks which can be used with tea. Yoga and fitness buffs are looking more and more frequently to tea as for natural hydration, energy and restorative qualities both pre-and post workout.Traditionally produced teas, authenticity.
Much like wine, coffee and chocolate connoisseurs have developed an appreciation for different regions, tea consumers are becoming increasingly savvy and aware of the nuances of origin and terroir in traditionally produced teas. Conscious consumers crave transparency in information and authentic stories surrounding the cultivation and production of specialty teas.
In our home state of Colorado, cannabidiol (CBD) tea is beginning to be seen in spas and wellness lifestyle retail establishments. CBD is the non-psychoactive counterpart to THC, derived from hemp. It is legal in all 50 states and is being used more and more as a wellness and relaxation ingredient. Herbal and traditional teas are thought to be a natural fit for CDB as a relaxant, and tea-based products are a rapidly growing niche in the cannabis wellness industry.
In total, 2019 promises continued opportunity in innovation in premium tea, as the bulk of the growth in the specialty tea segment will come from new serving and use methods as well as consumer education and sophistication.
Founder and CEO of The Tea Spot, author of Cancer Hates Tea
The matcha trend may be easing, which is a good thing because I was starting to see matcha showing up in literally everything, sometimes in products that were neither food nor drink. While the matcha bubble may be slowing down, I think we’re going to land in a world where Americans drink 10 times more matcha than they did a decade ago – yes!
Tea Master, Mighty Leaf Tea
I believe “transparency” will still be a buzz word in 2019 and moving forward as more and more consumers will want to know the actual source and the stories of the producers. With many big brands revealing their sources and their impact on the tea farmers and garden, other companies will follow through which will mean better understanding of the origins and true connections with the farmers.
While the RTDs, new botanicals will still be dominating the market, I am curious how the legalization of Cannabis in Canada will roll out for 2019. I believe some new innovations with the CBD infused teas etc. might start hitting the market in a commercial way pretty soon.
Regarding Nepal, I am looking forward to an uptick in the export volume and on the quality and consistency of the tea produced. The government is phasing out new rules and policies to favor the primary producers and assist more in the exporting procedures through subsidies. Furthermore, we’re expecting to see a lot more gardens certified organic and many young tea entrepreneurs gaining momentum locally.
Founder, Nepal Tea
Transparency will play a larger part in the tea industry in 2019. The rise in organic regulations outsourced to private agents continues to grow and it will inevitably lead to more misrepresentation and misleading labels. Consumers are looking for ethically sound and environmentally conscious companies, but the U.S. organic tea trade relies on certifications issued by 3rd party agents. Unfortunately these agents are known for being private independent companies that are not well regulated. As a result this leads to tea trade being inconsistently misrepresented and negatively effecting both local and international trade tea.
Founder & CEO Zen’s Tea House
There is still a huge opportunity for innovation in our industry with examples like cold brew, sparkling teas, wellness herbals etc. I feel the biggest challenge, however, is to build a more solid foundation for new tea companies to ensure their sustainable survival.
We are facing a retail apocalypse, one of the biggest this country has ever seen. Rents are rising, the number of customers traveling by stores “on foot” is going down. It is a retail crisis where the owners of small tea companies discover they are losing money before they even know it. They are then faced with the economic burden of restructuring their sales channels towards online markets while they negotiate fair agreements with their distributors.
There is much more to tea retailing these days than creating a product. Complying with regulatory changes, navigating the market to offer a safe, sustainable yet competitive and innovative product mix that will scale is just the start — and all this without loosing focus on managing cash. There are many trends and new products, and countless new recipes and wellness trends, but please let’s not forget the “one-on-one” of running a business.
In 2019 we see a big opportunity for younger brands to gain traction in both online and brick-and-mortar retail featuring quality tea. This benefits the world of tea as consumers are going to be the winners in this game. The pyramid bag, for example, is the vehicle to consume quality loose tea in the U.S. today and has manifested its position as the convenient choice of quality, whether we like it or not.
CEO, Haelssen & Lyon North America Corp, New York, NY