CUPPA TEA

Tea is reported to be the second most widely consumed beverage in the world after water. In 2023, Americans consumed almost 86 billion servings of tea, or close to 4 billion gallons. About 86% of all tea consumed was black tea and 13.6% was green tea, according to the Tea Association of the U.S.A. Inc¹. UK’s 2023 Product of the Year survey² with over 10,000 shoppers found that the majority of Brits drink three or more cups of tea a day (35%), with 20% saying they drink an impressive five to 10 cups a day. Asian teas including Boba, Matcha, and Kombucha are growing, hard tea is expanding, and white tea and Hojicha are emerging.

According to Circana’s U.S. data for the 52 weeks ending May 19, 2024³:

Canned and bottled tea sales reached $4.6 billion
Refrigerated tea achieved $1.6 billion in sales, an increase of 6.3%
Loose/bagged tea saw sales of $1.4 billion

Consumers associate tea as healthy with a natural and functional healthy halo. Globally, tea comes in many varieties, flavors, and applications. Black tea, green tea, white tea, oolong tea, and pu-erh tea all originate from the Camellia sinensis tea plant. The variation of nuanced tea flavors comes from the growing conditions and fermentation processes. Herbal tea, also known as herbal infusions or tisanes, is made from herbs, flowers, and grains such as peppermint, chamomile, and hibiscus. According to Innova Market Insights⁴, tea accounts for one-third of the global hot beverage market valued at $150 billion. Lemon is the fastest-growing of the top five tea flavors while floral, fruit, and spice flavors are growing in popularity. In the hot tea category, 30% of consumer purchase decisions are most influenced by the claim “made with natural/real ingredients.” Natural and no additives/preservatives claims show a CAGR of +11% and +6% respectively over the past three years. “The many different functional benefits of teas align with consumer needs for mental, physical, and emotional well-being,” states Sally Lyons Wyatt of Circana.

Whether your customers seek a hot or cold cuppa tea, Trilogy offers an assortment of tea flavors for multiple applications. Reach out to us here and request your samples here.

THE ASIAN INFLUENCE – RISE OF BOBA, MATCHA, AND KOMBUCHA

According to the UK Tea and Infusions Association⁵, tea originated in China in 2737 B.C. Boba, Matcha, and Kombucha all have roots in Asia and are making inroads in the U.S. Boba are the small, chewy tapioca spheres or popping bubbles found in Bubble tea, often called Boba tea. Boba originated in Taiwan and came to the U.S. in the 1990s. It has steadily been gaining momentum. A 2021 CLSA consumer survey⁶ found that 94% of individuals aged between 20 and 29 had bought boba tea in the preceding three months. Datassential⁷ reported that 46% of the U.S. population knows boba, and 26% have tried it, with awareness highest among Gen Z and Asian consumers. Based on IBISWorld research⁸, there are 5,555 Bubble Tea shop businesses in the U.S. as of 2023, an increase of 27.4% from 2022. According to Mintel⁹, Europe and North America collectively account for 41% of tea and RTD tea launches with boba in 2023, up from just 12% five years ago. The global bubble tea market reached $2.6 billion in 2023 and is forecast to reach $4.6 billion by 2032, with a CAGR of 6.5%, per the IMARC Group¹⁰.

In 2015, Matcha specialty tea shops in New York City started popularizing the vibrant tea made from ground Japanese green tea leaves¹¹. Now matcha is a global sensation known for its health properties including antioxidants and L-theanine. According to Tastewise¹², social conversations about Matcha have increased by 16.64% over the past year. In addition to tea, matcha commonly appears in baked goods and ice cream. Mintel’s research¹³ found that matcha is popular among consumers aged 16-34. However, the data also uncovered that the high price is a barrier to consumption. Within the iced coffee segment, Mintel’s data¹⁴revealed that Gen Z consumers are flavor-curious and over index in their interest for matcha-flavored RTD options. The global Matcha tea market is expected to reach $6.86 billion by 2033 with a CAGR of 9.9%, according to Fact.MR¹⁵.

Kombucha, fermented and sweetened tea, originated in Northeast China around 220 B.C. and gained popularity in the 1990s due to its digestive health properties¹⁶. It has a complex taste often described as “effervescent, tart, tangy, and sour.” Rich in probiotics, Kombucha’s rise stems from consumers’ interest in immune health and now appeals to a broad consumer base. According to Mintel¹⁷, 38% of U.S. consumers have tried kombucha, and 21% are interested in doing so again. Research and Markets¹⁸ estimates the global kombucha market will be worth $2.4 billion in 2024 and is projected to reach $5.9 billion by 2029, at a CAGR of 19.4%.

Quench your customers’ thirst for Asian-inspired tea beverages such as Boba, Matcha, and Kombucha. There is no need for a passport. Stay rooted and reach out and request your flavor samples here.

HARD TEA

Tea is spilling into the Ready-To-Drink cocktail space with hard tea introductions. Twisted Tea by Boston Beer debuted in 2001 and has dominated the hard tea segment. The brand accounted for 91% of hard tea sales as of May 2023, according to Bump Williams Consulting¹⁹. Circana data²⁰ shows that dollar sales for Flavored Malt Beverages (FMB) reached nearly $4.4 billion, a 16.1% increase, for the 52 weeks ending January 28, 2024, in total U.S. multi-outlets. Hard teas were up 25.2% in value and up 19.2% in volume versus a year ago. According to IWSR²¹, hard tea is experiencing significant growth as a number of new brand entries look to gain share and premiumize the segment. For example, in 2023, tea brands like Arizona and Lipton entered that hard tea market. This year several new players such as High Noon Vodka Iced Tea, Jack Daniel’s Country Cocktails Hard Tea, and TEABIRD Hard Sweet Tea launched. Voodoo Ranger released Hard Charged Tea with a 7% ABV compared to the typical 5% ABV. The global hard tea market reached $2.1 billion in 2022 and is expected to reach $8.7 billion by 2030 growing at a CAGR of 19.5%, per DataM Intelligence²².

For Distilled Spirits and Beer, Trilogy offers an array of TTB-Approved flavors. Request your samples here.

WHAT’S BREWING?

Black and green tea currently dominate the market. For example, in RTD, black tea accounted for over 50% of launches in 2023, and green tea 30% in the North American market, according to Finlays²³. Consumers continually seek new products and new flavor profiles. Hojicha and white tea are being explored. Hojicha is Japanese green tea roasted over charcoal. The distinct taste is described as having a smoky flavor with nutty undertones and notes of cocoa²⁴. According to Spate²⁵, Hojicha searches grew 54.6% YoY growth compared to the previous year, while Hojicha latte grew +173.9% in searches compared to last year, and 2.4K average monthly searches. White tea is also on the radar. In 2024, 7.7% of RTD tea launches contain white tea up from 4.2% in 2023 and 1% in 2022, per Finlays. Spate’s data found consumer interest in Silver needle tea also known as Baihao Yinzhen. It is an expensive, delicate white tea produced in Fujian Province in China. Its search popularity grew +138.5% compared to last year, reaching 1.8K average monthly searches. Yellow tea, primarily available in China, is considered rare and expensive²⁶. It is also from the Camellia sinensis plant. It is processed similarly to green tea but includes a unique step called “sealing yellow.” The tea has a smoother, mellower taste and is less grassy than green tea. Watch to see if Yellow tea is the next to brew.

Let Trilogy read the tea leaves and create tea flavors for multiple applications including hot and cold beverages and alcoholic drinks. Reach out to us here to partner on your next tea project and request your samples here.

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