The escalating prices prevent more active growth of the industry and lead to the change in preferences of many local consumers with more of them beginning looking for cheaper products. Euromonitor International analysts confirm this, noting that current negative economic factors may lead to stagnation of both tea and coffee sectors of Germany in the middle term.

Lina Sidorenke, a senior analyst with Euromonitor International, said, “[According to our data,] inflation, a prevailing concern in Germany, is exerting a considerable influence over consumer behaviour. The prices of daily essentials, including coffee, have witnessed upward spirals, prompting consumers to be more judicious in their purchasing decisions.”

She said that the impact of inflation is visible in coffee, where consumers are increasingly opting for cheaper brands and exploring discounters to address rising costs. “Rising prices have encouraged many brands and retailers to offer promotions and discounts to drive up volumes. Still, despite the increasing prices of food and beverages, German consumers remain loyal coffee drinkers, as coffee is part of their everyday routines, thereby supporting positive retail demand at present.” Euromonitor reports that sustainability in coffee remains a dominant theme both for consumers and brands. For example, single serve coffee capsules have come under scrutiny for their contribution to environmental waste. According to the global market research firm, several players have introduced compostable packaging solutions to address these concerns. Effectively communicating these sustainability features has become paramount, as consumers increasingly seek eco-friendly coffee products.

Sidorenke explained that “the demand for fresh coffee beans is on the rise in Germany and continues to pose a threat to coffee pods and/or capsule machines. There is increasing availability of fully automated coffee machines that can actually compete with single-serve solutions, both in terms of price and taste.” She said in the long term, an increasing number of consumers are expected to switch to fresh coffee beans, especially as they are perceived as offering a richer coffee experience.

Mintel, shares the same view, noting that due to cost issues more and more German customers prefer to consume coffee at home instead of visiting cafés. A recent report from the global market research firm states that given the current economic backdrop, the reintroduction of 19 percent VAT and the overall strained financial situation in Germany, many consumers are trying to bring the café feeling home.

According to Mintel, most local customers are turning to inexpensive products and blends that are based on barista-made coffee. Instant coffee and coffee blends are the perfect solution for coffee lovers who are careful with their money. Mintel analysts believe that in the short term, this ongoing financial pressure on households holds further potential for more cost-effective formats. Companies can take advantage of changing consumer behaviour. Younger target groups in particular respond to barista-made coffee drinks at home. Both analysts and local coffee companies said this may all be good news for coffee brands, but the situation is highly problematic for cafés.

Cafés had a tough time during the pandemic due to constant closures. And now they are once again feeling the pressure of rising living costs, which are being exacerbated by the reintroduction of 19 percent VAT in the hospitality industry of Germany.

At the same time, they are threatened by outlets that do not specialise in coffee. For example, percent of consumers actually buy their coffee from a bakery or retailer, not in a café. Due to ongoing income pressures, more local consumers have become disloyal to their coffee brands, which created serious problems even for some major local players. Furthermore, the market is highly competitive and highly fragmented.

Premium brands in particular have been hit hard. And even the market leader Nescafé, which continues to lead the instant coffee segment, has been faced with downward trend. Some leading representatives of the German coffee sector shared that the ever tightening regulations along with climate change may lead to the decline of production of some coffee varieties.

Thomas Eckel, coffee sommelier and owner of the Murnau Coffee Roastery, one of the largest roasteries in Bavaria, in an interview with German Meininger business paper, said the EU Deforestation Regulation (EUDR), which aims to keep products linked to deforestation off the European market will  oblige companies to prove that their supply chains do not contribute to deforestation and that environmental, labour and human rights are respected. That may create some problems for the industry, as all of the companies will require support from farmers.

Eckel has also expressed some serious concerns about the effects of climate change on the entire industry and German coffee producers. “Coffee is one of the agricultural products most affected by climate change. We should take this very seriously. In general, we will definitely not drink coffee the way we do today in 2050. Many cell-based coffee products are also coming onto the market. These will help to close the gap in coffee supply.”

The current market challenges are putting additional pressure on leading German coffee manufacturers and could be associated with serious losses for them already in the short-term. In contrast to previous years, they will be unable to increase prices for their products to compensate their losses due to recent
accusations in price fixing.

For example, at the beginning of the current year, the local trading company Bartels-Langness accused Melitta of having formed a Germany-wide coffee roasting cartel with competitors Dallmayr, Kraft Foods (now Mondelez) and Tchibo between 2002 and 2008, which agreed on coffee prices. During this period, Melitta is said to have charged prices that were around 11 percent too high. Most of the companies declined to comment, however all of them believe the pressure from regulators on the market will continue to grow in Q4 of this year and in 2025.

Tea Struggles but Shows Resilience

Euromonitor’s Sidorenke added that similar to coffee, inflation is impacting Germany’s tea sector. “As inflation drives up the cost of everyday essentials, including tea, local consumers are making thoughtful choices in an attempt to manage their expenses. One prominent shift is towards private label and
discounters, where cost savings become paramount. Established tea brands are
responding by offering competitive promotions and discounts to retain their share.”

She said that at the same time, it would appear that the medium-priced segment is struggling the most, as consumers either turn towards cheaper options or they can still afford their favourite premium brands. “Although the cost-of-living crisis is forcing many consumers to reduce their expenses, tea remains popular, especially as it is considered a natural remedy to strengthen one’s immune system or simply for staying hydrated throughout the flu season.”

Germany-based tea manufacturers also said the existing problems seriously complicate their further development. Dirk Wollenhaupt, managing director o, which imports and blends teas, said the current situation remains complex, however the company sees potential for its further growth that will be achieved by the rise of efficiency of

Due to escalating costs, more German consumers are drinking coffee at home rather than in cafés.  “The German tea market is currently restrained and challenging. However, we expect a positive development in the medium term. The market has changed and the challenges have increased. In order to meet these challenges, we have adapted our processes and implemented many measures to increase efficiency,” he said, adding that being a producer of tea blends, Wollenhaupt has pursued a strategy of operational excellence over the past few months and orientated all processes towards being able to optimally serve its customers.

“The aspect of rapid availability and reliable, punctual delivery is extremely important in the tea market. We have invested intensively in the training and development of our staff and optimised production processes. In addition to
these measures, we have strengthened our sales activities with a sales office in the USA for the North American tea market,” Wollenhaupt explained.

Despite the existing problems, in its latest report Tee Report 2024, the German Tea & Herbal Infusions Association (GTHIA) revealed that most of local players have been able to adapt to the current realities of complex economics. Per the report, most medium-sized and family-run German tea companies were able to
consolidate and some even expanded their economic success in 2023-2024. The GTHIA said this was mainly due to their high-quality and innovative range, which enjoys big demand both in the domestic market and abroad.

The report finds that even though per capita consumption fell slightly in 2023 versus 2022, tea manufacturers have been able to record increasing sales. The GTHIA believes that is a sign of the strength of the German tea industry, noting that new, innovative products such as cold brew teas or functional teas, manufacturers are arousing the desire, especially among younger target groups.

Optimism for Future Growth

Even with the tough economics, most local producers and analysts expect that both coffee and especially tea sectors of Germany will resume its growth in the mid-term. On the product side, Dirk Wollenhaupt said there is the ever increasing demand for functional teas, ie, teas with additives such as melatonin, minerals and vitamins, and have greatly expanded our range in this area. “Other trends that we are observing in the German tea market and can serve with our products are wellness teas, iced teas, milk teas and mocktails with tea. The demand for high-quality green teas is also increasing. Sales of matcha in particular continue to grow in Germany due to its wide range of applications. With our partner in Japan and an extensive, high-quality range, we are very well positioned and are now one of the largest suppliers in Germany.”

He added that even though tea consumption in Germany fell slightly in 2023 compared to 2022, it remains at a high level. “Due to numerous new applications as an ingredient, as a beverage base or as a cocktail, we firmly believe that tea consumption will continue to rise in the medium term.”

As for coffee, most of local analysts expect the segment of caffeine-free coffee will provide a serious impetus for growth for the entire German coffee sector already during the period of 2024-2025. Mintel analysts report that more than half of 16 to 24-year-olds would welcome a larger range of caffeine-free products and would also be willing to pay more for such alternatives. This offers companies and brands opportunities for innovation in the area of low-caffeine and caffeine-free alternatives, for example in thecdrinking chocolate and tea segment.

The post Germany’s Tea and Coffee Industries are Growing Despite Tough Economics appeared first on Tea & Coffee Trade Journal.

The Camellia sinensis plant, from which matcha originates, was first cultivated for use in tea in China in the 3rd century BCE, but it wasn’t until the 7th to 10th centuries that the practice of consuming the leaves in the form of matcha was first documented. Matcha, unlike the infusion process of its black and green tea sisters, is made by finely grinding the tea leaves into a powder that is mixed with hot water and consumed in its entirety. It is thought that a Japanese Buddhist monk brought matcha to Japan
sometime around the 12th century, where it was considered highly valuable and coveted and therefore necessitated a careful preparation method, and so its consumption and preparation developed into a spiritual practice by the 16th century, the whisking of powdered green tea into hot water a meditative ritual. Since matcha began as a rare and premium product, the ceremony of its preparation became
entrenched in its consumption. In modern day Japan, matcha tea ceremonies are still widely practiced, and while it is no longer reserved for the elite or ‘ruling class’, it is still deeply ritualistic with specific implements such as the bowl and bamboo whisk, and even particular whisking motions or patterns.
Meanwhile, elsewhere in Japan, the matcha latte has become extremely popular, commercialised
and readily available, and co-existing alongside its traditional consumption in the country.

Matcha Migrates West

Western countries have long since been discovering and adopting Japanese culture and cuisine, and matcha is no different, with it seeing a marked rise, particularly in the US. Future Market Insights (FMI) reports that the matcha market in 2023 was worth USD $2.7 billion and is expected to reach $7.1 billion by 2033 — a CAGR of 10.2 percent. FMI attributes this growth to the interest in its health benefits, use in skincare and culinary applications such as confectionery. The latter of which is driving
its popularity in the Indian market, according to Fact MR , while the health benefits are driving the market in the US.

Japanese tea company, Ippodo, was founded in 1717, “when the [matcha] tea ceremony had begun to be enjoyed by other elites like warrior families and high-class townsfolk,” said Tomoko Honda, head of global operations, Ippodo. In 2001,Ippodo began selling its matcha overseas as the number of international visitors to its Kyoto shop had begun to increase.

The growing interest in matcha was also noted by Germany-based tea supplier, Wollenhaupt, which had previously only been including matcha in its catalogue as a ‘marginal phenomenon’, said Marco Sinram, head of tea trading and sustainability, Wollenhaupt, but recognised that demand was developing ‘dynamically’, and therefore now offer three different types of matcha to its customers.

“Ten years ago, very few people had heard of matcha and now the market is absolutely exploding. So many new matcha brands have popped up in the last couple of years and you can find matcha on menus in more cafés and restaurants. The UK is now following in the steps of places like New York and Los Angeles with matcha bars popping up across the country,” said Katherine Swift, founder and CEO
of OMGTea, a UK-based specialist matcha green tea company.

One such place is Blank Street coffee chain, which began in Brooklyn, New York, in August 2020, and now has locations across New York; Boston, Massachusetts; Washington, DC; and in 2022 debuted in London. While Blank Street serves an array of café and coffee shop offerings, some of its most distinguishable and popular products are its matcha beverages.

When Blank Street launched in London in Summer 2022 ,matcha wasn’t a widely accessible drink. There were limited places to get matcha on the high street, but most of those places offered either expensive or low-quality matcha. We wanted to disrupt the market by launching exciting flavour combinations that made a niche category into one that is more fun and accessible for everyone,” explained Ignacio Llado, UK managing director at Blank Street. “In Spring of 2023 we launched our Blueberry Matcha, joining the classic Matcha Latte on our menu. This drink was the first of its kind in London, and […] immediately caused a huge buzz, with TikTok and word of mouth helping it to quickly climb to become a Blank Street best seller.”

Matcha’s vibrant green colour affords it a social-media-ready aesthetic for consumers, fuelling its popularity among influencers and the younger generation. Blank Street has recognised this in its marketing strategy, making use of clear cups and contrasting colours to bring its matcha drinks to life.

While many of the high-street iterations of matcha lattes and frappés may be heavy on sugar or cream, matcha itself is considered a remarkable health food, with this being another, perhaps the largest, draw to the product for consumers. “Matcha aligns well with overall wellness trends and appeals to those looking for more specific benefits such as a healthier alternative to coffee or energy drinks, detox,
increased antioxidant intake, weight management, etc,” said Swift.

A Healthy Shade of Green

The way in which the Camellia sinensis plant is grown in order to produce matcha, allows for the accumulation of catechins, (−)-epigallocatechin-3 -gallate (EGCG) in particular is most abundant in matcha. It is these catechins that provide high antioxidant properties and give matcha its reputation as a health drink. It has been found that “regular consumption of matcha may have a positive effect on both physical and mental health,” according to the report Health Benefits and Chemical Composition of Matcha and Green Tea: A Review by Joanna Kochman, Karolina Jakubczyk, Justyna Antoniewicz, Honorata Mruk, and Katarzyna Janda, published on PubMed Central.

It is the health benefits of these antioxidants found in matcha that encouraged Swift to establish OMGTea. She began researching its benefits after her mother was diagnosed with breast cancer, then both she and her mother began routinely drinking matcha green tea. Five years later, Swift launched OMGTea, and a year after that she founded The Healthy Life Foundation, a charity that funds research into age-related diseases, including cancer.

Swift emphasised, however, that the quality of the matcha consumed is essential to reaping its health
benefits. While matcha is generally considered a premium product, there are more affordable blends
available; these are the kind often used as ingredients in confectionery or desserts where the matcha taste need not be so refined. Matcha can be tested for its quality by examining the colour and texture, as well as the taste. She explained that they quality check their matcha regularly using the ‘finger/stroke test’, whereby matcha powder is placed on a white piece of paper and, using a finger, is pulled across the page to observe its colour and texture alongside others. The brighter the green colour, the higher quality the matcha, also the particle size of high-grade matcha ought to be between five and ten microns, as fine as baby powder, said Swift.

This essential colour and texture gauge all comes from the farming process, which has specific methods to ensure these attributes. “For around three weeks before harvest, shades are put over the tea fields to block out the sunlight, which increases the amount of flavourful, umami-rich components in the tea leaves. After the leaves are harvested in the beginning of May, the leaves are steamed, cooled and dried, baked, and sorted. […] The leaves are then ground with stone mills to produce the fine powder called matcha,” explained Honda. Shading the tea leaves is a traditional characteristic of matcha production, and is a method invented centuries ago in Kyoto, Uji, Japan, and is now widespread, she noted.

It is the shading that boosts the leaves nutrient levels, causing an overproduction of chlorophyll, contributing to its bright green colour, added Swift. The stone mills are also what produce the silky, fine texture of quality matcha, whereas lower grades are cut and blended using steel, which, she noted, reduces the flavour and bio availability of the matcha’s nutrients.

The location where the matcha is grown is also crucial to its quality and flavour. There are specific areas that are known for their matcha production, such Uji, Japan, “one of the most renowned regions for matcha growing in the world,” said Llado, and it is around this area that Wollenhaupt, Blank Street and Ippodo source their matcha. The region of Kagoshima, Japan, is also particularly suited to matcha production, benefitting from its volcanic soil and climate, commented Swift, and is where OMGTea sources its products.

Sustaining Production

With such specific regions and fastidious productions techniques, are matcha’s producers prepared to meet the surging global demand from the product, not just domestically in Japan, but as far away as the US and UK? Sinram explained that, while Wollenhaupt believes that the highest and most authentic quality of matcha can be found only in Japan, it is possible to source it from other producing countries,
depending on the requirements of the customer.

Meanwhile, Swift noted that in the Kagoshima region, practices are being undertaken to increase production in order to meet demand, “Farmers in Kagoshima have been adopting advanced agricultural techniques to enhance matcha. These innovations help increase yield and improve the quality of the tea leaves. Some tea farms are converting or expanding their fields specifically for the cultivation of tencha, the raw material used to make matcha. Local government initiatives and support for the tea industry have also played a role in encouraging the growth of matcha production in the region.”

Honda added that as global climates change, areas that are suitable for production are shifting and will continue to shift. “Areas where tea can be grown will likely change or expand as well, whether inside or outside of Japan. We are not sure what the future will bring, but it is key to plan for and adapt to changes.”

This growth in demand has created a broad market for matcha with varying requirements and uses. Where it has historically and traditionally been an exceptionally premium and ceremony-bound product, it is now a commercialised and accessible product for many consumers, posing the question of how far it can be removed from its origins and cultural significance? “While it’s great that matcha is going more mainstream, we want to make sure that it still feels special and comes with the holistic experience that has been central to Blank Street since we first launched,” noted Llado.

So where perhaps the ceremonial aspect of matcha may no longer be a necessity, it still can add something to the experience of consumers, if they engage with it, encouraging more mindful consumption, said Swift.

Honda added that, while consumers may not know of its ceremonial or spiritual origins, “during the tea ceremony and in Japanese society in general, when drinking matcha it is considered important to feel gratitude for the person who made the matcha for you and for those who produced it. We think it would be wonderful if that sentiment grew alongside the increasing popularity of matcha worldwide.” Therefore, its marketing is crucial, to not only offer consumers a brightly coloured health drink, but also a moment of reflection on both the beverage and the process that went into every sip.

• Kathryn Brand is an associate editor with T&CTJ, while still writing for several of Bell’s
  other magazines. She joined Bell Publishing at the beginning of 2022 after graduating from
  the University of East Anglia with a degree in English Literature and Creative Writing.

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The post-Covid surge in the popularity of functional beverages is ongoing and has significantly bolstered the consumer spend and interest for such products, or rather ‘the wellness economy.’ As this movement has matured, it has, by extension, expanded and brought to the forefront wellness teas specifically catered towards women. This, combined with a growing feeling of disempowerment of women’s health needs, has resulted in a strong market demand in the women’s wellness tea category.
There is an ever growing group of companies that offer women’s wellness tea products, whether they are tea companies that have expanded their product portfolio to meet the demand, or companies which have founded themselves on the premise of supporting women through tea. HotTea Mama falls under the latter. Founded by Bethan Thomas and Kate Achilles, the brand offers consumers a selection of products to support different stages of women’s reproductive life, from menstruation, pregnancy, nursing, and menopause.

Thomas, co-founder and tea scientist at HotTea Mama, explained the premise behind the company’s founding, “It wasn’t until I got pregnant that I realised the majority of the herbal blends that I was creating, weren’t suitable for pregnancy due to many of the ingredients inside. This triggered the idea for HotTea Mama, as my best friend [and I] went through motherhood and suffered with morning sickness, struggles breastfeeding and sleeping… We wanted to make teas that were suitable for this life stage, to be both delicious and supportive. As we grew, our customers started to ask if any herbs or teas could support periods and perimenopause, and I used my tea biochemistry knowledge to create blends for this time of life too.”

Similarly, Poorvi Chordia, founder of Herbs & Kettles, which sells premium single-origin Indian teas, was inspired to create teas for women’s wellness due to personal and professional experience. “As a woman and a frontline physician, I experienced firsthand the importance of self-care and stress management, especially in the face of life’s challenges. Tea played a significant role in keeping me grounded and providing moments of solace during stressful times.”

Wollenhaupt offers a large variety of herbal teas, including a ‘Women’s Power’ blend. Image credit: Wollenhaupt

Meanwhile, Smith Tea recognised its high number of female-identifying customers and wanted to offer a product with health and wellness and “functional nourishment” as a priority, commented Sara Kaufman, product development manager and lead tea maker for Smith Tea’s Empower Mint blend, which was specifically designed with holistic women’s health in mind.

A demand for holistic wellness

Tea companies are noting and building on the idea of women as individual and important consumers with significant purchasing power. “Women’s health is a priority for Traditional Medicinals because we recognise the unique needs and experiences of women throughout their lives. We believe in providing natural and effective support for women’s health concerns, from menstrual health to pregnancy and lactation support,” shared Kristel Corson, chief marketing officer, Traditional Medicinals.

But why is it that women are turning to teas for their health needs in the age of modern medicine? It is part of the growing consensus that the Covid-19 global pandemic inspired, that self care and holistic wellness is something that should be prioritised and sought after in everyday products through functional food and drinks. “During the pandemic, we have learnt that many people have taken more time for themselves again […] People are living more consciously and paying more attention to their health and diet,” noted Michael Görres, head of product development at Wollenhaupt.

Smith Tea’s Kaufman added that “the pandemic highlighted a long-forgotten (or perhaps just overcomplicated) need for finding holistic wellness in our lives. From work-life balance to cleaner eating, the wellbeing economy supports wellness across the board and functional teas sit at the pinnacle of that.” At a time when people felt a need to have some control and agency over their health, a functional beverage market blossomed and remains a strong category even still.

But taking power and control over one’s own health, in the ways that one is able, is something particularly pertinent to women. Thomas explained that “women’s wellness and health has been hugely neglected in society and in medicine for a very long time, which has made women more open to looking at their health holistically.”

Smith Tea’s Empower Mint tea contains four herbs that cover systematic health for women of all ages and demographics. Image credit: Smith Tea

Some medical professionals cite concerns, however, that women are turning to alternative therapies “at the expense of engaging with proven medical approaches, and with conditions such as endometriosis affecting around one in ten women of reproductive age, this kind of marketing can be dangerous,” wrote Dr James Brown, senior lecturer in biology and biomedical sciences, Aston University, in a Guardian article titled “Women: beware teas with a gender agenda.”

However, this perspective overlooks the fact that many women do seek professional medical intervention, but use holistic healthcare, such as herbal teas, alongside it, or as a last resort when doctors are not able to help. “The truth is, that there is a huge medical gap in the UK, and all other countries. Women are often not recognised or heard by their doctors. Especially with conditions like endometriosis, PCOS (polycystic ovary syndrome) and adenomyosis — these are hard to diagnose and women on average have to wait 7.5 years for a diagnosis. In this time, they are forced to take charge of what they can in their diet and lifestyle to support,” added Thomas.

Studies and traditions

While it is true that women cannot necessarily expect a cure for their female-related ailments through wellness teas, there is a growing portfolio of scientific evidence and studies that show an amount of benefit can be seen from regular consumption. An example of this is an article titled “Herbal Infusions and Women’s Health: A Review of Findings with a Focus on Human Studies on Specific Infusions with Studies on Extracts to Evaluate Mechanisms,” by Gill Jenkins, Christopher John Etheridge and Pamela Mason, from the Journal of Nursing and Women’s Health sourced via Gavin Publishers. The paper demonstrated that German chamomile, rosehip and spearmint are all shown to give women health benefits in human trials. German chamomile was found to improve aspects of sleep in postnatal women, as well as being beneficial for pre-menstrual syndrome (PMS), anxiety, stress, and metabolic control.

Rose hip was associated with improved symptoms of menstrual pain, and spearmint improved hormone control. “These infusions contain a range of phytochemicals, including flavonoids, which help to explain their health outcomes. Most of the human studies indicated that 1-3 cups daily with brewing times of 5-15 minutes provided the health benefit in question,” the study noted.

Raspberry leaf, red clover, ginger and turmeric are also routinely favoured in women’s wellness tea offerings and are among those that have been used as herbal remedies stretching back generations. Companies endeavouring into women’s wellness teas have to choose how to balance verifiable scientific evidence with anecdotal and traditional uses. “We’re careful to only use ingredients that have historical use but are also backed up with research in more recent years. While the research studies are often small scale, we work with a technical agency to review new research regularly and ensure that there is as much evidence as possible to suggest that the majority of women will benefit,” said Thomas.

It is this deeply rooted historical practice that also may also be bolstering the attraction of wellness teas for women, observed Corson. “The appeal of these teas to women may be rooted in their historical connection to nature and traditional herbal practices that have long been passed down through generations of women.”

Chordia also noted that women tend to be more open to “an integrative approach towards health.” She added that “they are also more [receptive to] trying Eastern medicine which has a multitude of health benefits and often functional teas and tinctures play an important role in these alternative approaches. Women more often form communities that empower each other, and that often helps them take charge or ownership of their health and wellbeing than men.”

HotTea Mama offers a range of wellness teas for different stages of women’s reproductive life. Image credits: HotTea Mama

While many companies stress that their wellness teas can benefit both men and women, they are overwhelmingly finding that their consumer base is dominated by women and as such, are marketing their teas with this in mind. However, some view gendering teas as a marketing strategy in itself. Görres explained, “In the herbal tea sector, it can make sense to develop gender-specific teas for the respective needs and with a target-group orientated approach.”

On the whole, people tend to drink herbal teas for their health benefits as well as just their flavour, and since men- and women-identifying individuals often have different wellness needs, especially in relation to reproductive health, it makes sense for teas to be targeted in this way. Corson noted that this must be done with some care; “gendering teas can be a marketing strategy to target specific demographics and highlight the relevance of certain products to their unique needs. However, it’s essential to ensure that gendered marketing does not reinforce stereotypes or exclude potential consumers. Ultimately, the effectiveness of marketing strategies depends on the authenticity of the brand’s message and its ability to resonate with consumers’ values and experiences.”

Market movements

With herbal tea market sales expected to grow at a CAGR of 7.3 percent to USD $7,693.5 million between 2023 to 2033, according to market research company, Future Market Insights, there is no doubt a driver of this is consumers’ search for products to improve their health and play a functional role in their beverage consumption. The trend for customisation is expected to influence this market with consumers wanting tea formulations for their specific health concerns, including women’s wellness. These are also anticipated to grow in the organic and ‘natural’ space as “people are making a conscious decision to drink better quality teas that are organic, directly sourced and fresh, farm to cup,” said Chordia.

While some may consider women’s wellness teas a trend or marketing gimmick, and for some companies that may be true, but there are equally companies that are investing in the research and utilising centuries old traditions of herbal remedies to give women comfort, relief, relaxation, or even just a moment of pause to enjoy a delicious cup of tea. And with the functional market and ‘wellbeing economy’ ever-growing, this category is not expected to go away any time in the foreseeable future.

• Kathryn Brand is an associate editor on T&CTJ, while still writing for several of Bell’s other magazines. She joined Bell Publishing after graduating from the University of East Anglia with a degree in English Literature and Creative Writing. She may be reached at: kathryn@bellpublishing.com.

The post Gendered teas: a marketing strategy or women’s reprieve? appeared first on Tea & Coffee Trade Journal.

More scope and agency lie with both the farmer and the brands selling the tea to define the grade of the tea they produce or sell, whether that be specialty, premium, commodity, or the infinite distinctions in between. And this largely is centered around pricing; if the tea costs more to produce it needs to be priced higher and is therefore generally considered a higher grade tea, but there may also be a discrepancy between how the brand positions itself and the quality of the tea it is selling.

Premium and specialty tea, most would agree, is of an elevated quality, and the consumer will recognise this at the point of purchase by factors such as its price point, packaging (loose leaf, specialty tins, pyramid tea bags etc), origin information, sustainability credentials, or how and where it is sold. But the question remains, how much overlap is there between the two segments, and is there a way of distinguishing one from the other? Are there certain attributes only associated with specialty tea, for example? Without the clear distinction of coffee available, it is easy for the segments to blend into one another, or as Marco Sinram, head of tea trading and sustainability at Wollenhaupt commented, for the premium label to be a mere marketing tool rather than a differentiation from its commodity grade cohort.

Attempting to distinguish specialty and premium

Wollenhaupt, a wholesaler that also provides blending, flavouring and packaging services, operates across all grades of tea, commodity through premium and specialty. “We are catering, on the one hand side, to large industrial customers with very commercial qualities. And on the other hand, we are also supplying, to very specialised kinds of customers, high-end teas which can be called a real specialty rather than premium,” explained Sinram. Therefore, where Wollenhaupt crosses the spectrum of tea, it is in a unique position that necessitates dividing the tea it processes into segments, and translating somewhat arbitrary distinctions into something it can put a value against.

Sinram marked the distinction between specialty and premium as such; “Premium certainly is defined as high quality, but it can also be, for example, a blend of various types of tea or various origins of tea. Whereas the true specialty tea we would rather define as a single origin tea, or even to be more defined, which is located from a single tea estate, or even more specific in our case, which is being produced from a special type of tea plant cultivar.” He added further that it can also come down to the specific method of production that makes a tea unique, and therefore specialty. However, Sinram agrees there can be overlap between premium and specialty.

There is concurrence with Sinram’s perspective and that of Hälssen & Lyon, which trades, refines, blends, flavours and packages teas from the world’s leading tea-producing countries. The company’s spokesperson defined premium tea products as “orthodox produced whole leaf or broken Camellia sinensis products, as well as fruit or herbal products with visually appealing flowers and a wide range of high quality flavourings.” Whereas specialty tea comes “from specific regions or growing areas and is often inaccessible to the average consumer due to their limited availability and high price. In comparison, premium teas are much more accessible due to the unlimited variety of flavours that are available in each tea category.” The region where the tea is grown remains crucial in defining the category, as does the availability, which both drives the price and is a symptom of it.

Image: Wollenhaupt

Similarly, Sandra Nikolei, a member of Kloth & Köhnken’s (K&K) tea department/corporate social responsibility team, emphasised the production method, “specialty tea means it is a special tea, it was not produced a ‘normal’ way. The shape or the leaf size must be special, formed or like a Pai Mu Tan, just sun dried and not formed. [Whereas] Premium tea can be made by normal production but the taste must be special. The taste must be unique or extra ordinary.” K&K wholesales, blends and packages some of the world’s finest teas.

This suggests that, while the precise distinction can verge into the realm of vague, it is possible to pinpoint distinct and tangible attributes that separate specialty tea from premium, and indeed most importantly, set specialty on a level above that of premium. However, this viewpoint is not universal, and is not shared by all corners of the tea industry. Mark Donovan, head of botanicals, flavours & innovation at Tata Consumer, which includes five tea brands under its umbrella (teapigs, Tetley, Tata Tea, Good Earth, and Vitax), commented, “The term specialty tea is a construct of the industry. […] I would define specialty tea as any tea (whether leaf or fannings) that is not a straight black or green tea. Within all three sectors there is premium tea, which consumers equate to price point rather than actual quality or type of tea.”

Donovan’s point is reiterated by Bala Sarda, founder & CEO of Vahdam Tea. “Specialty teas encompass a broader category of teas that have been enhanced or infused with additional ingredients, flavours, or production techniques. These teas, also known as value-added teas, include blends incorporating herbs, spices, flowers, or fruits to create unique and innovative flavour combinations. Specialty teas may also encompass limited edition blends or signature blends developed for special occasions,” he noted.

Whereas premium teas, Sarda explained, “are defined by their exceptional quality and often command higher prices in the market. These teas are typically sourced from specific regions known for producing high-quality leaves, such as select invoices of first or second flush from renowned tea-growing regions like Assam and Darjeeling. Premium teas are prized for their distinct flavour profiles, aromas, and superior craftsmanship, making them sought after by tea connoisseurs who value excellence and authenticity.” In other words, how Hälssen & Lyon’s spokesperson, Sinram and Nikolei define specialty tea.

It is evident that even for actors within the tea supply chain, there is confusion and discordance about what exactly specialty tea is when compared to premium tea and whether they can even be distinguished from one another. However, both categories are distinct from commodity or mass produced tea and their origins and production reflect this.

Higher quality tea at origin

Premium and specialty teas are generally grown on smaller farms, with less land and therefore lower yields, not only due to the land size but also due to the very nature of the tea. “You cannot use every leaf. Mostly you use only two leaves and one bud or even less,” explained Nikolei, resulting in the cost of raw materials on a weight basis, being much higher, added Donovan. Further, such teas require gentle handling and additional training when being harvested, increasing the labour costs at the farms. “It’s more labour intense, because to maintain specialised types of tea plant cultivars, it definitely takes more time and labour to look after,” said Sinram. The quality requirements are just that much higher.

“Quality control stands as a paramount aspect, necessitating meticulous oversight at every stage of production. This involves not only the careful selection of tea leaves but also the implementation of precise processing techniques and stringent quality control measures to ensure consistency and excellence in the final product,” stated Sarda. And this quality control can also include adherence to certifications such as Fairtrade, Rainforest Alliance, or organic, which involves further cost from the producer, as well as specialised processing techniques to preserve the best flavours. It is a much more cost intensive process for the farmer, which they hope to offset by being able to charge a higher price.

And this is normally the case, with the cost being transferred along the supply chain and resulting in a higher priced tea at point of sale. This is a higher price in relation to commodity grade tea, however it can vary widely from only a little higher, to a lot higher, depending on the tea, and quite how premium or specialty it is, as well as how the company selling it chooses to market it.

Selling premium & specialty tea

It is becoming increasingly common to see higher quality or premium-grade tea in supermarkets and grocery stores, brands such as teapigs or certain ranges of Twining’s and Pukka, being the major UK ones. But in order to find the truly the most premium or specialty teas, Sinram said the number one place they are best sold is in dedicated tea shops.

Image: teapigs

“Some of the most outstanding quality teas we sell end up in specialised tea shops because you need to give the consumer who buys high quality tea, a specialty type of tea at a fancy price. [However,] you need to [offer] this consumer a lot of information, otherwise they will not accept the high price unless they understand the reason why the product [is so pricey],” said Sinram, adding, “and with the understanding and with knowledge, the consumer is more [willing] to pay a [high] price for such a product. And in my personal opinion, that works best in the shop where you have a face-to-face kind of experience between the knowledgeable shopkeeper and the consumer. I think this is still the best way to sell a specialty tea; either tea shop or specialty food shop.”

Sinram explained that the next best option for selling specialty or premium teas is online, where a lot of information about the teas can be provided; origin, background knowledge, special ways of preparation. There are myriad possibilities for brands to showcase this online, whether it be text, images, graphics or videos.

It is the additional information that is provided about premium and specialty teas that also sets them apart. In the same way as coffee, if a consumer is paying a higher price, they want more information for that price; they want to truly understand what it is they are paying the extra cost for and why. If one is to accept Sinram, Nikolei and Hälssen & Lyon’s spokesperson’s distinction of premium and specialty, whereby specialty tea is that step above premium and exceptionally contingent on specific regions and cultivars, it is in these tea shops where this kind of tea is best appreciated and sold, and the information supplied with it is essential.

The demand for quality

The appetite from consumers for higher quality teas is on the rise. “Based on Nielsen Market data, American consumers are showing declining demand for commodity grade teas and are more than willing to pay a little more to get a significantly better beverage experience,” revealed Darren Marshall, CEO of Smith Teamaker.

Vahdam Tea’s Sarda also noted an uptick in demand for higher quality tea, and credits this to consumers’ heightened interest in the nutritional value of the products they consume; “Higher quality teas, known for their rich antioxidants and other wellness-promoting properties, are becoming increasingly sought after by consumers seeking to enhance their overall well-being.” He also referenced the growing emphasis on origin and authenticity, and as a result the sustainability of such products, as well as the desire for indulgence and sensory pleasure which has prevailed, along with demand for wellness, since the Covid-19 pandemic.

While there may be growth in the premium segment, Sinram argued that for the especially high-end, or what he defines as specialty tea segment, there is some growth, but it is expected to remain a niche market. “I think it’s natural that these types of products will never be a mass type of market product.”

Nevertheless, there is some growth, and a reason for that, Sinram noted, is due to Western consumers, especially the younger demographic, being attracted by Asian culture, Asian food and Asian rituals. And this especially involves tea. Sinram said that they are “interested in preparation of high quality tea, the Asian way. Which is a very specific type of tea preparation compared to what we do in the UK, and what we do in Germany and so on. And it’s appealing to consumers.” Sinram added that specialised tea courses are becoming popular, where consumers can learn about tea production and especially preparation, much like is common in the wine segment with tastings and vineyard visits.

This knowledge is so much more readily available to consumers with the dominance of the internet and social media. Rituals and expert preparation techniques can be learnt freely and readily across the world. Highly premium and specialty tea is something, as Sinram noted, that is still a niche market in the Western world. However, this is not the case in specialty tea-producing countries such as China, Japan and Taiwan. He explained that the “main ratio of their production, and specifically also the high quality part of their production, is tending to remain in country for internal consumption,” because the demand as well as understanding and knowledge for high quality teas is so much higher and consumers are willing to spend a lot more money for such teas. So, a lot of highly premium and specialty teas are not being exported to reach the Western market as there is such a good internal requirement.

Yet with the desire for knowledge surrounding specialty and premium teas in consuming countries growing, it will not be surprising to begin to hear more calls for a universal definition of specialty tea, as in the specialty coffee world. If large players in the tea industry remain ambiguous and even discordant on how to differentiate and articulate tea quality, then how can consumers be expected to fully engage with and understand the information companies give them about their premium or specialty teas, or make informed decisions about their purchases? An accepted definition would be useful and would help clarify the difference between premium and specialty tea in the eyes of consumers, as well as bringing the specialty tea world up to the lofty success of specialty coffee.

• Kathryn Brand is an associate editor on T&CTJ, while still writing for several of Bell’s other magazines. She joined Bell Publishing at the beginning of 2022 after graduating from the University of East Anglia with a degree in English Literature and Creative Writing. She may be reached at: kathryn@bellpublishing.com.

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