The tea industry is waking up to wellness

More than four in five consumers drink tea, according to the U.S. Tea Association. The category is getting more popular and is beginning to focus on wellness as a key hook.

Tea is the second most widely consumed beverage in the world after water. Americans drank more than 85 billion servings in 2021, with roughly half of the population enjoying it on any given day, according to the Tea Association. Even more remarkable is that Americans drink 50 per cent less of it than people in Canada do. Its popularity is huge.

Among all age groups, millennials are the most likely to drink tea, with 87 per cent consuming it.

While marketing to younger consumers was not a wide strategy a few years ago, it has become evidently important.

Hain Celestial, for example, has expanded its marketing to younger demographics while also accelerating the expansion of a newer line of wellness teas, reports Food Dive.

“It was absolutely part of the inspiration and it kind of made us believers in addressing this demographic with a benefit-forward platform,” said Tim Collins, the general manager of Hain’s Celestial Seasonings tea business. “We really started to see the opportunity … that maybe we didn’t realize prior.” 

Packaged tea sales have been flat or slipping in recent years, with the exception of a spike in 2020 which, according to NielsenIQ data, was down to more people staying at home drinking tea and keeping a closer eye on their health during the pandemic. However, U.S. packaged tea sales resumed their downward slide last year, dropping 4.8 per cent.

As people limit their intake of sugary drinks and focus on boosting health, wellness teas with attributes like probiotics and relaxation, energy, and immune support have grown in popularity.

Packaged teas with probiotics, for example, have risen each of the last four years to nearly US$29 million for the year ending Jan. 29, 2022. Those with immune health benefits have jumped for three consecutive years to just under $34 million during the same period, NielsenIQ data showed. 

The likes of Hain Celestial and Twinings, the ubiquitous name in the tea market, are optimistic that the market can capitalize, and are trying to help that happen.

Twinings debuted its own line of wellness teas in 2018 and Hain Celestial did so in 2019. Since then, both companies have expanded and pivoted that strategy to maximize their offerings.

Twinings relaunched its new line of wellbeing teas last year under the Superblends banner in Sleep+, Energy+, Immune Support+ and Heartea+ varieties. Many of these offerings also include vitamins, adaptogens, and flavourings to differentiate the brand from the organic and natural manufacturers who are reluctant to include anything non-plant-originated in their products.

It’s working, too. Twiningss’ Superblends banner has grown 31.2 per cent on average month-over-month since September 2021.

Others, from CPG tea providers to independent cafes, may want to follow suit.