By Art Lopez, Director of Marketing, Tea for Finlays Americas
Tea has had a complicated history in America. Beginning with the Boston Tea Party, a profound moment in the origin story of our nation, and one that has defined America’s relationship with tea ever since. That event distorted Americans view of tea as a pro-British good and drinking tea became seen as unpatriotic. Years later, tea started to reposition itself. The 1893 Columbian Exposition and the 1904 World’s Fair took place during summer months with crowds seeking cold, refreshing beverages. Quick-thinking entrepreneurs cooled hot tea through an iced pipe, ultimately creating iced tea, which rapidly began to dominate US tea consumption. This preference for iced tea still lives on today, with over 80% of the tea consumed in the US being iced.
Iced tea has become an increasingly popular drink with Americans but currently the U.S. tea market is in a state of flux. Due to lifestyle changes brought on by the pandemic, there has been a shift in consumer consumption habits. While these changes have highlighted growth in some areas of the category, it has at times, been a detriment to other channels. The most obvious example of this is the short-term increase in at-home consumption. However, this growth was not organic and was cannibalization from on-premise foodservice consumption of tea.
The industry is now at a place where there is an opportunity for the foodservice sector to gain back on-premise consumption. After living through two years of the pandemic, consumers are thirsty for new experiences and seeking out interesting and exciting products in food and beverage. This desire presents a chance for foodservice operators to help attract consumers back into stores over the next year.
Recreate the coffeehouse experience: Foodservice and c-stores can gain back customers by utilizing the familiar and comforting experience that consumers have with coffee and mirroring that to enhance the tea experience. Tea is often not as prevalent on menus as other beverages within foodservice in the United States. During the summer months, there may be some lighter, refreshing iced teas highlighted on menu, but the cultural experience within foodservice weighs heavily towards coffee.
This cultural experience with coffee has engrained itself as a morning time ritual for most Americans. It will be extremely difficult for tea to overtake coffee during the morning rush, yet tea has the chance to find its place within other parts of the day. Foodservice establishments have found success running promotions during lunch time, afternoon, and evening to facilitate traffic during off-peak hours. Tea lends itself well to these occasions and, if operators can capitalize on these marketing efforts and utilize tea with intriguing flavor profiles or formats, it can be used as a key driver to get customers into their stores.
- Dispensing Innovation: Forward thinking foodservice establishments can choose to invest in dispensing equipment that allows for easy, quick service and will not put stress on an already strained labor force. Tea companies, such as Finlays, have created bag-in-box concentrates that easily plug into dispensing units. The outcome is a tea beverage that is on par with hand-crafted beverage offerings. The additional benefit of these types of systems is the ability to get even more creative by adding mouthfeel with nitrogen or carbonation. These beverages would offer an elevated experience without the additional need to train the labor force on how to create crafted teas.
- Get Ahead of the Trend: Lastly, a big draw for consumers in foodservice are stores that offer products that are on or ahead of the trends.Sometimes the most compelling trends are not the newest or most exciting ones. For example, a trend that is anticipated in foodservice tea is inspired by the global relationship between tea and dairy. The U.S. market tends to be drawn toward indulgent, dairy based food and beverages. Combine this preference with global tea consumption habits in India, Thailand, Japan and even Europe and there is opportunity for very indulgent possibilities. Chai lattes, Thai lattes, matcha lattes or even a “London Fog” are all beverages that have been around for centuries, yet many American consumers still are unaware of their existence. However, amid rising green coffee prices, these types of indulgent, dairy-based tea beverages may emerge as a new option for traditional coffee customers, particularly in foodservice.
The US tea market is primed and ready for innovation. The category has become relatively flat over the past few years, which provides an opportunity to explore new possibilities for tea. With a robust history of harnessing our expertise to support the development of tea and coffee products, Finlays is uniquely positioned to support your exploration into tea and coffee innovation.
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