Changing tea tastes offer prospect of further category growth, says John Nevens, co-founder of category, customer and shopper management specialist Bridgethorne.
Research showing the extent to which the UK is embracing herbal teas and fruit infusions at the expense of traditional English breakfast tea reveals potential for significant category growth for those suppliers able to deliver insights on how to take advantage of our changing tastes.
The research revealed year-on-year growth in value of speciality tea and fruit & herbal infusions of 6% and 5% respectively. This compares to a 5% decline in value for the mainstream tea sector. (Source: Kantar World Panel, 52 w/e 20 July 2014.)
It reflects what we see around us: cafes and coffee shops are having to offer more than just standard black tea, and brands such as Twinings, Teapigs and Clipper have grown in popularity. Even the bigger brands like PG Tips and Tetley have introduced fruit, green, herbal and decaffeinated teas into their ranges. This is attracting younger drinkers who perceive them as having health and well-being benefits, something that has also underpinned the 5% growth in sales of decaffeinated tea in the last year.
There’s no evidence to suggest that this growth in the speciality tea market is going to slow down. Far from it. In fact, with new formats, including biodegradable pyramid bags and loose leaf teas and new blends, the category offers strong prospects for growth for suppliers who do what it needed to understand the category. Yet, suppliers need to have an effective category strategy in place to discuss with retailers, which reflects the expectations and goals of the supplier and the retailer.
Suppliers must regard it as their responsibility to help grow categories, increase margins and help the retailer deliver on its KPIs, but it seems that while retailers are crying out for the data, analyses and reports that help them build the category as a whole, many suppliers continue to fail to carry out even these routine category management tasks.
This means crunching the numbers, completing the analyses, building the reports, undertaking the range reviews and using the insights from the data to show how to grow the category for the benefit of both themselves and the retailer, and how best to channel investment.
Simply supplying great products may no longer be enough. From our regular conversations with retailers and their buyers, we know that there is frustration that, when it comes to trying to get products listed, suppliers are often missing solid category based rationales. They often don’t know how to extract the best insights from their data, or turn it into a selling story that resonates with the buyer. What we do helps grow categories and by leveraging objective insights, suppliers and retailers may also benefit by developing joint initiatives for category growth and creating mutually beneficial trade investment plans.
John Nevens is director of Bridgethorne, a specialist in customer and category management and shopper marketing. This is a personal blog and views expressed are his own.
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