Special edition: Botanicals

Wellness teas are driving botanical beverage growth

Wellness teas are driving botanical beverage growth

Savvy product differentiation and strong consumer demand are driving growth in specialist tea sales, but botanical drinks such as tree waters have yet to find favour, according to retailers and analysts.

Fruit and herbal teas are having a strong showing across Europe, according to Euromonitor, with sales of €1.6bn in western Europe and €591m in eastern Europe in 2016.

Stronger consumer demand for healthy drinks as well as the expansion of tea specialists has boosted sales of fruit/herbal teas in many developed markets,” said Virginia Lee, senior analyst for beverages at Euromonitor, in an analysis published late last year.

Fruit/herbal tea sales have also grown strongly in multiple emerging markets as tea producers increasingly emphasise the functionality of their products,” she added.

Producers target wellness segments

Lee gave the example of Pukka Herbs, which grew sales by 19% in Norway and 10% in the UK in 2015, on the back of new tea varieties, including a detox-branded offering.

Brands like Pukka, Heath & Heather, Dr Stuart’s or Yogi, our predominant brands, are becoming more sophisticated by mixing new botanicals to fulfil the consumer’s requirements,” said Gary Trickett, chairman of the UK National Association of Health Food Stores and owner of three health food shops in England.

We’re now seeing an increase in teas that are branded for specific requirements – for example you could have a camomile tea, but you could also have a night-time tea that’s predominantly camomile. You could have a tea that has ginseng in it, but now we have ones that say ‘wake up’ or ‘morning time’ or ‘rise and shine tea’ with ginseng in.

The manufacturers are becoming a little more market-orientated in creating niches. And the consumer likes that, as they come in with a specific mind-set – say they can’t sleep at night, so they want something that helps them sleep better,” he added.

Turmeric tea sales ‘through the roof’

Trickett said Indian-influenced Ayurvedic products were also very popular.

Turmeric is the obvious example. If we’re looking at our tea offering over just the last 12 months, the amount of turmeric teas we’re selling has gone through the roof.

Two years ago maybe, we didn’t have any tea with turmeric in it – now we have turmeric capsules, tablets and tinctures, we sell turmeric in our superfood powders, we sell turmeric tea, mixed with other things but also on its own,” Trickett added.

Other European markets are seeing similar trends, with Lee citing Tata’s Vitax brand in Poland and Dodagan in Turkey using wellness claims to grow sales.

More fruit/herbal tea producers are expected to follow Tata and Dogadan's lead and turn their focus to fortified/functional teas within this segment by introducing more products with specific wellness claims, such as immunity, digestive health and slimming,” said Lee.

In addition to Poland and Turkey, … manufacturers' initiatives to highlight functionality should boost fruit/herbal tea sales in other markets, to help fruit/herbal teas become the fastest-growing tea category at the global level over the 2015-2020 period,” she added.

Tree waters ‘the next wave’?

Beyond teas, and superfood powders for home smoothie concoctions, Trickett said the main botanical drink category with reasonable demand currently was kombucha. But for other categories, such as tree waters, there is not yet any particular market buzz.

Personally, I’ve not seen an uptake yet in tree waters, such as maple water or silver birch water. We did very well with coconut water a few years ago – although that market has, ironically, been diluted, and coconut water is available everywhere, and our sales have disappeared,” he said.

Trickett noted that the market was highly fickle, and said tree waters might yet have their moment: “Maybe we’re starting to see that wave building out to sea – and in another 12 months it might be the next wave we’re trying to catch. And we’ll ride that for a couple of years, until that eventually fades out.”

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