2022
9
UK Tea and Other Hot Drinks Market Report 2022
2022-09-03T04:05:42+01:00
OX1102579
2195
155399
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Report
en_GB
“Tea holds a comforting constancy for people. The cost-of-living crisis will boost the appeal of this perception, as consumers seek out emotional support during stressful times, while cost-saving efforts fuelling…

UK Tea and Other Hot Drinks Market Report 2022

£ 2,195 (Excl.Tax)

Description

The UK Tea and Other Hot Drinks Market Report identifies consumers’ attitudes towards purchasing and consuming tea and other hot drinks, the impact of inflation and future innovation in the UK hot drinks market. This report covers the UK tea market size, market forecast, market segmentation and hot drinks market trends.

 

Current Landscape of the UK Hot Drinks Market

Rapidly rising inflation is putting household budgets under growing pressure in 2022. This looks set to curb the growth of out-of-home food and drink occasions, supporting retail sales in the UK tea market and other hot drinks. The low-value image of leading brands, however, points to the retail segment too being exposed to trading down.

 

 

UK Tea Market Share and Key Industry Trends

Mintel’s hot drinks and tea market research indicates reveals that while standard black tea continues to be the top value segment in the UK tea market, younger consumers are turning away from the traditional brew. To support long-term sales, the UK tea market will need to innovate ways to engage with younger consumers or ensure a presence in other tea segments that they show more interest in.

  • 77% of UK consumers agree that they drink tea to feel less stressed.
  • 26% of UK adults would be interested in truing fruit/herbal tea that was made with ingredients made in the UK.
  • 49% of UK consumers believe that tea is a good alternative to an alcoholic drink.
  • 43% of UK adults agree that hot malted drinks are good for helping get them to sleep.

 

Future UK Tea Market and Hot Drinks Market Trends

Mintel’s tea market research indicates that tea has the potential to benefit from the alcohol moderation trend; 48% of over-18s who buy and drink tea sometimes turn to the brew as an alternative to alcoholic drinks.

In the longer term, consumers’ focus on health and wellbeing will continue to support the UK tea market. However, the intense competition from coffee and various soft drinks will see volume sales fall further. If the current younger generation retains their tea habits, the slow shift away from traditional black tea and towards other segments will continue.

To discover more about the UK Tea and Other Hot Drinks Market Report 2022, read our UK The Future of Tea 2022, or take a look at our extensive Tea Market Research.

 

Covered in this Report

Products: Black tea, decaffeinated tea, speciality tea, fruit and herbal teas, green tea, instant tea, hot chocolate powder, cocoa powder, and hot malted drinks.

Brands: Yorkshire Tea, Twinnings, PG Tips, Tetley, Pukka, Clipper, Teapigs, Tick Tock, Scottish Blend, Mondelez (Green & Black’s, Cadbury’s), Options, Mars (Galaxy), Jacob Douwe Egberts (Tassimo), Nestle (Milo), Associated British Foods (Ovaltine), Aimia Foods (Horlicks), Greenpeeps, Mighty, Tesco, Selfridges, Kokoa, Kib, Starbucks, Waitrose & Partners, Co-op, Diplomat, Dairyfine, Poundland.

 

Expert Analysis from a Specialist in the UK Hot Drinks Market

This report, written by Angharad Goode, a leading analyst in the beverages industry, delivers in-depth commentary and analysis to highlight current tea and other hot drinks market trends and add expert context to the numbers.

Tea holds a comforting constancy for people. The cost-of-living crisis will boost the appeal of this perception, as consumers seek out emotional support during stressful times, while cost-saving efforts fuelling at-home occasions should prevent a steeper drop in tea retail sales. Localism and alcohol moderation trends represent potential areas of growth in the longer term.”

Angharad Goode - Research Analyst Goode
Research Analyst

Table of Contents

  1. Overview

    • Key issues covered in this Report
    • Market context
    • Products covered in this Report
  2. Executive Summary

    • The five-year outlook for tea and other hot drinks
      • Figure 1: Category outlook, 2022-27
    • The market
    • Market size and forecast
      • Figure 2: Market forecast for value sales of the UK tea and other hot drinks retail market, 2017-27
    • Fruit and herbal tea continues to grow value as volume stagnates
      • Figure 3: Retail value sales of tea, by segment, 2020-22
    • Companies and brands
    • Yorkshire Tea and Pukka buck downward trend
      • Figure 4: Leading brands’ sales and shares in the UK retail tea market, 2019/20-2021/22
    • Launches centre on packaging, seasonal editions and emotional support
    • Adspend drops slightly
      • Figure 5: Total above-the-line, online display and direct mail advertising expenditure on tea and other hot drinks, by month, 2019-22*
    • The consumer
    • Overall usage of tea is almost universal
      • Figure 6: Types of tea and other hot drinks drunk, 2022
    • Supermarkets main channel for purchase
      • Figure 7: Where people bought tea, 2022
    • Over half interested in switching to more ‘eco’ tea varieties
      • Figure 8: Behaviours related to tea, 2022
    • A quarter interested in UK-grown tea
      • Figure 9: Interest in concepts for tea and other hot drinks, 2022
    • Tea is widely seen as a source of emotional support
      • Figure 10: Attitudes towards tea and other hot drinks, 2022
  3. Issues and Insights

    • Consumers’ financial wellbeing takes a hit, tea faces threat of volume curbs
    • Sustainability, UK sourcing and transparency on production processes can pay off for brands
    • Opportunity calls for teas offering relaxation benefits, or pivoting to tap into alcohol moderation
  4. Market Size and Performance

    • Sales dip in 2021, further volume decline expected in 2022
      • Figure 11: Retail market size for tea and other hot drinks, 2017-22
  5. Market Forecast

    • Inflation to replace COVID boost in 2022
      • Figure 12: Category outlook, 2022-27
    • Volumes to fall, inflation will drive value sales growth over 2022-27
      • Figure 13: Market forecast for value sales of the UK tea and other hot drinks retail market, 2017-27
      • Figure 14: Market forecast for volume sales of the UK tea and other hot drinks retail market, 2017-27
    • Learnings from the last income squeeze
      • Figure 15: Annual growth in the UK value and volume retail sales of tea and other hot drinks, 2008-12
    • Forecast methodology
  6. Market Segmentation

    • Fruit and herbal continues to grow value as volume stagnates
      • Figure 16: UK retail value and volume sales of tea, by segment, 2020-22
    • Hot chocolate declines further
      • Figure 17: UK retail value and volume sales of hot chocolate and malted drinks, by segment, 2020-22
  7. Market Drivers

    • COVID adds to focus on sustainability
    • The conflict in Ukraine is hurting the UK economy in a number of ways
    • Employment has held up better than expected
    • Inflation is the key concern in 2022 for consumers and brands…
    • …and will weigh down the post-COVID recovery
    • Consumer spending power will be curbed
    • Consumers’ financial wellbeing has fallen from the heights of 2021…
      • Figure 18: Household financial wellbeing index, 2016-22
    • …and most people are feeling the effects of price rises
    • Tea should avoid worst impacts of income squeeze
    • Tea prices begin to climb
      • Figure 19: RPI average price for tea bags, 2017-22
    • Tea can benefit from health trends
    • Alcohol moderation is mainstream
    • The income squeeze is likely to heighten stress
    • HFSS restrictions can open up opportunities for tea
  8. Market Share

    • Typhoo Tea secures investment
    • Unilever sells Ekaterra to CVC
    • Yorkshire Tea and Pukka buck downward trend
      • Figure 20: Leading brands’ value sales and shares in the UK tea retail market, 2019/20-2021/22
      • Figure 21: Leading brands’ volume sales and shares in the UK tea retail market, 2019/20-2021/22
    • Hot chocolate brands see sales drop
      • Figure 22: Leading brands’ value and volume sales and shares in the UK retail hot chocolate market, 2019/20-2021/22
    • Horlicks and Ovaltine neck-and-neck
      • Figure 23: Leading brands’ value and volume sales and shares in the UK malted drinks retail market, 2019/20-2021/22
  9. Launch Activity and Innovation

    • Biodegradable claims continue to climb
      • Figure 24: Share of tea product launches in the UK market with environmentally friendly packaging, recycling and biodegradable claims, 2017-22*
    • Brands explore refill schemes
    • Seasonal launches leap ahead in 2021
      • Figure 25: Share of seasonal products in tea, hot chocolate and hot malted drinks product launches in the UK market, 2017-22*
    • Easter sees hot chocolate melt launches boom
      • Figure 26: Hot chocolate melt/bombe product launches, 2022
    • Brands mark Platinum Jubilee
      • Figure 27: PG Tips Platinum Jubilee edition Original tea bags, 2022
    • Stress and sleep remain focus of functional claims
      • Figure 28: Share of product launches in the UK tea market with functional claims, by claim, 2017-22*
    • Twinings continues to broaden herbal offering
      • Figure 29: Twinings Superblends Sleep product launch, 2022
    • Supermarket own-labels lean into wellness teas
      • Figure 30: Own-label tea product launches with a functional claim, 2022
    • Tetley introduces new Discovery teas
      • Figure 31: Tetley Discovery black tea with red berries and English Breakfast Tea packaging, 2020-22
    • Horlicks introduces functional malted drinks
  10. Advertising and Marketing Activity

    • Adspend drops slightly
      • Figure 32: Total above-the-line, online display and direct mail advertising expenditure on tea and other hot drinks, by month, 2019-22*
    • Yorkshire Tea launches ‘golden hour’ campaign
      • Figure 33: Total above-the-line, online display and direct mail advertising expenditure on tea and other hot drinks, by brand, sorted by 2022, 2019-22*
    • Pukka continues its Unwind With Nature campaign
    • Tetley campaign celebrates brand love
    • Twinings campaign focuses on emotional benefits
    • Teapigs releases first TV campaign
    • Clipper focuses on taste and eco credentials
    • PG Tips celebrates Platinum Jubilee
    • Typhoo debuts first brand campaign in five years
    • Cadbury on-pack competition looks to Make January Better
    • Nielsen Ad Intel coverage
  11. Brand Research

    • Brand map
      • Figure 34: Attitudes towards and usage of selected brands, 2022
    • Key brand metrics
      • Figure 35: Key metrics for selected brands, 2022
    • Brand attitudes: Cadbury leads on perceptions of trustworthiness
      • Figure 36: Attitudes, by brand, 2022
    • Brand personality: Brands stand neck-and-neck on perceptions as ethical
      • Figure 37: Brand personality – macro image, 2022
    • Pukka leads group on perceptions of style
      • Figure 38: Brand personality – micro image, 2022
  12. Drinking Habits – Tea and Other Hot Drinks

    • Overall usage of tea is almost universal
      • Figure 39: Types of tea and other hot drinks drunk, 2022
    • Standard black tea remains most used, other types lag behind
    • Half drink standard black tea every day
      • Figure 40: Frequency of drinking tea and hot drinks, by type, 2022
  13. Where People Buy Tea

    • Supermarkets are the main channel for purchase
      • Figure 41: Where people bought tea, 2022
    • Two-fifths buy tea online
  14. Behaviours Related to Tea

    • Over half interested in switching to more ‘eco’ tea varieties
    • Green packaging provides little standout
    • Greenypeeps offers cues on transparency
      • Figure 42: Behaviours related to tea, 2022
    • Biodiversity claims warrant attention
      • Figure 43: Mighty M.lkology drink with “eco impact” details, 2021
    • Tea is widely seen as an option for alcohol moderation
    • Relaxation cues can boost appeal
    • Health benefits can reinforce tea’s position as an alcohol alternative
  15. Interest in Concepts for Tea and Other Hot Drinks

    • A quarter are interested in UK-grown tea
      • Figure 44: Interest in concepts for tea and other hot drinks, 2022
    • Single-origin hot chocolate interests a third
      • Figure 45: Hot chocolate product launches with a single-origin ingredient claim, 2020-21
  16. Attitudes towards Tea and Other Hot Drinks

    • Tea is seen widely as a source of emotional support
      • Figure 46: Attitudes towards tea and other hot drinks, 2022
    • Understanding production processes appeals to two-fifths
      • Figure 47: Kib Tea, 2022
  17. Appendix – Data Sources, Abbreviations and Supporting Information

    • Abbreviations
    • Consumer research methodology
  18. Appendix – Forecast Methodology

    • Market forecast and prediction intervals
      • Figure 48: Market size and forecast for UK retail value and volume sales of tea and other hot drinks, 2017-27
      • Figure 49: UK value sales of tea and other hot drinks, best- and worst-case forecast, 2022-27
      • Figure 50: UK volume sales of tea and other hot drinks, best- and worst-case forecast, 2022-27
    • Market drivers and assumptions
    • Forecast methodology
  19. Appendix – Where People Bought Tea

      • Figure 51: Buying of tea and other hot drinks, 2022
  20. Appendix – Market Share

      • Figure 52: Leading brand owners’ sales and shares in the UK retail tea market, 2019/20-2021/22
      • Figure 53: Leading brand owners’ sales and shares in the UK retail hot chocolate market, 2019/20-2021/22
      • Figure 54: Leading brand owners’ sales and shares in the UK retail hot chocolate market, 2019/20-2021/22

About the report

This market report provides in-depth analysis and insight supported by a range of data. At the same time, introductory and top-level content is provided to give you an overview of the issues covered.

Market

Mintel provides a range of market information, frequently through the category level, including market size and forecasting, complete with market drivers that illustrate the forces that shape a category or market.

Consumer

Mintel’s proprietary consumer research provides our analysts with the attitudinal and behavioral data used to provide valuable insight to topical issues.

Brand/Company

Mintel provides overviews of the top brands and manufacturers, and uses consumer research to explore attitudes and reactions to brands, as well as insight into what will resonate with consumers.

Data

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*databooks not available with UK B2B Industry reports.

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