Joe Simrany, President, US Tea Association
a conversation about where the industry has been, where it's going, and the pitfalls to avoid along the way.
Tea's conquest of America has often been predicted. Earlier expectation, unfortunately, proved greatly exaggerated. Are we now finally seeing the fulfillment of this prophesy?
The word "conquest" seems much too strong when talking about tea. Tea influences; tea suggests; tea invites new consumers to discover its wonders. Tea appeals to the intellect, to consumers sensibilities. Like its flavor profile, tea takes a more subtle approach to market expansion. Tea prefers gradual gains to explosive growth and it prefers to win over consumer's minds & bodies as opposed to attacking its competitors.
It is a strategy that is a bit more "plodding" (deliberate) than many would like but it is steady and it is lasting. Over the last decade or two, tea has made many inroads into America driven by new forms, new availability, the promise of health benefits, the appeal of its varied flavor profiles, the promise of profitability, and its tremendous versatility.
While significant gains have already been made, the industry remains under-appreciated by many consumers and the "fight" to expand its presence in America has a very long way to go.
Political Science students have a saying that Brazil is the country of the future, and always will be. Are you not worried that tea's "civilized" pace may consign it to a similar role?
It has long been my contention that if our competitors had only half as much going for them that tea has going for it then they would command the marketplace. The Tea Industry is a conservative industry and has been since the beginnings of recorded time. While this has served to slow down its rate of growth it should be noted, with a bit of surprise, that next to water - tea is the most popular drink in the world.
Over the last decade or so tea has become more popular in the US as well spurred by new product innovations, the promise of health benefits, as well as the discovery of myriad flavors and variations from around the globe. Growth is not explosive but it has been steady and promises to be long lived.
So while the Tea Industry has virtually unlimited potential, it is also making solid gains in the area of beverage popularity. As time passes the very nature of the Tea Industry will change as non-traditional tea companies begin to market tea beverages or use tea as an ingredient in other products. As these changes occur, the speed of progress will inevitably increase spurred by entrepreneurs and innovators who have few, if any, ties to the traditions or culture of the old-line industry.
The entrepreneurs and innovators you describe are primarily engaged in the specialty tea segment. How much of that energy and vigor is reflected among the industry's more traditional players?
The Specialty Tea segment is fortunate to have its share of innovators and entrepreneurs although it accounts for only about 10% of the volume of the total market. It is interesting to note that one of the fastest growing segments of the market for tea and the single largest segment of the mass market is Ready-To-Drink. It accounts for about 40% of the market with an impressive amount of innovation and marketing pizzazz coming from traditional players and their soft drink partners as well as newly formed companies seeking to come into the marketplace.
The efforts on the part of the traditional marketers to capitalize on the health message for tea far out-pace anything that is happening on the Specialty side of the business. In fact, the health effort, which is credited for the revitalization of the tea industry, is entirely due to the efforts of the traditional tea industry.
The traditional segment is also responsible for establishing a selling environment that is conducive for the entire tea industry to flourish including the appeal of specialty teas. Were it not for their stabilization effect, today's market for tea would not be nearly as vibrant.
The Tea Industry is made up of many parts and its overall success or failure is dependent upon each of the component parts contributing to the well-being of the total entity.
Are there any pitfalls that you would advise the industry to avoid in order to realize the glorious future that is so often predicted?
While the future looks very bright for the entire Tea Industry, there are certainly issues that must be addressed if it is to continue to gain sales momentum and consumer interest.
The first cautionary note concerns the tea & health message. It has multiple parts.
1. The trade must exercise restraint in how it communicates that message to consumers.
a. It is dangerous to over-promise. If ever the industries conservative nature could serve it well, it is here. By making extravagant claims about the health contributions attributed to tea the message becomes watered down and becomes unbelievable. Stick to the facts and, whenever possible, quote some other medical authority, the Association, a specific study, or a particular article as opposed to embellishing what you think you know.
b. Be very careful about what you say on your packaging. By law, the only thing that we can currently say is to factually state what the antioxidant levels are on a per saving basis. No other comments about the health benefits of tea are approved by the government for use on packaging other than some very generic comments about the role of antioxidants in the diet. Companies going beyond these limits do so at their own risk but, more importantly, they risk generating negative publicity which could affect the entire industry - not just their own company.
c. Don't convert tea from a pleasurable beverage into a medicine. Remember the primary reason why consumers drink tea is because they like the taste or how it makes them feel. In all of your marketing efforts, the sensory appeal of tea should be the priority message with health playing an important secondary role.
d. Don't attempt to diagnose your consumer's medical conditions or offer advice about how tea may play a role in alleviating any condition. The only advice that is suitable under these conditions is to suggest that they follow the advice of their own medical doctors.
e. Whenever possible let the medical professionals and scientists talk to the media about the health benefits of tea as the message is perceived to be much more credible than if coming from someone with a vested interest in selling tea.
2. The second concern is relative to tea being sold away from home. I am not talking about the quality of tea being served in tea rooms because presumably it is of high quality and properly prepared. I am referring to the quality, preparation, and presentation of tea sold in diners, restaurants, hotels, and institutions across the US. In many cases it is far from ideal and serves to constrain the consumption of tea in these outlets.
The entire tea industry needs to be concerned with this issue and needs to be part of the solution; either directly through educational materials or indirectly through their complaints as consumers.
3. The next issue is one of social responsibility. In the past, allegations of the abuses of the rights of workers, especially children, have been made by various authorities. While the allegations have never been proven they could generate negative publicity which is never good. The key here is to make sure you know who you are buying your tea from and that you have challenged your suppliers to certify that they are abiding by all applicable laws of their respective countries. This is one area where it pays to do your homework to ensure that each one of us and the industry in general is on solid ground.
This does not mean that you should necessarily obtain your tea from some sort of third party organization (this is more of a marketing decision than anything else) simply that you have an obligation to ensure that you are dealing with reputable suppliers.
4. The forth and final concern is one of education of the trade and consumers. Many people are coming into the tea industry with little or no formal training in the business of selling tea. True, they are bringing a passion which propels them forward and is transmitted to their customers but passion alone is not enough. It is important for each of us to be communicating the same information about tea whether we are talking about health benefits, types of tea, caffeine levels, preparation method, storage conditions, nuances of taste, or any other question that may come up. By communicating the wrong information or half information, consumers become confused which could easily translate into reduced consumption.
The Tea Association of the USA and the Specialty Tea Institute offer several opportunities throughout the course of the year for newcomers to tea to obtain a formal education through our Certification program. Now there is no excuse for anyone within the tea trade not to have at least a fundamental knowledge of tea to ensure that consumers will hear a consistent message.
No one coming into the industry should expect that these Certification Programs will entitle them to be called a Tea Master (a title which is probably properly applied to only a handful of people in the entire world). However, it will certainly help them to achieve a level of professionalism that will increase their credibility amongst the peers in the trade as well as their customers.
These are the major concerns that come to mind and the areas where the entire Tea Industry needs to pay close attention to ensure that positive momentum for tea continues uninterrupted.
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