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Tea Bag Segment Is Growing At 50 Per Annum

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The Goan |  GOA |  18-07-2016

Tea bag segment is growing at 50% per annum

TE-A-ME recently launched a unique mobile teacart, which it calls a `flavour station`, at Taj Vivanta in Panaji. The proponents of the brand believe that its unique flavours in tea bags will be a huge hit among young Indian consumers. The Goan spoke to Sunil Parikh, India head, TE-A-ME Teas about the growing popularity of the tea bag segment and the company`s future plans
Q: Could you tell us why have you chosen Goa for launching your first flavour station in India?
Sunil Parikh: Well, one of the reasons is definitely that a lot of tourists come to Goa and then our concept is we make people have our tea so that they realise its quality. Plus, I have to say that we found a great partner in Taj Vivanta in Panaji. Partnering with Taj gives a lot of credibility to our brand.
Q: How is this flavour station going to operate at Taj Vivanta?
SP: The flavour station will be either stationary or mobile in a tea room, café or a restaurant of the hotel. It`s a composite station that has a built-in inverter with an induction plate that allows for serving the flavour of choice live to guests. We have 20 flavours in India, which we will offer at this flavour station as well.
Q: What do you have to say about people in Goa in terms of their preference for tea?
SP: For us, Goa, in that sense, is a relatively newer market. But, I believe with the variety of tea flavours we have, we should be able to offer
something for all kinds of palate. Besides, a lot of foreign tourists also come to Goa, who like consuming tea. Russians come to Goa in huge numbers and they drink a lot of tea.
Q: Since you mentioned flavours, could you shed some light on TE-A-ME`s various flavours?
SP: We have split our tea flavours broadly into two groups. One is blacks, which is more traditional tea. In this, we have flavours like Assam, Early Grey, Darjeeling and English Breakfast. Then, we have greens and we realized that a lot of people don`t like the taste of plain green tea as it`s a tasteless product. The Indian palate wants flavour and taste. So, our experts in blending worked on creating flavours of green tea with mint, and also with lemon & honey. We have a wonderful Kashmiri Kahwa, which is green tea with Indian spices, and consists of natural ingredients. Then, we also have infusions, which are served in tea bags, but they aren`t tea. Within infusions, we have flavours like apple cinnamon, cranberry apple and chamomile infusion.
Q: The tea market is rather stagnant in India growing at just 2-3 per cent per annum. Don`t you think it will be difficult for an upcoming brand like TE-A-ME as the market itself isn`t really growing at a high rate?
SP: When we talk about tea market in India, we mostly refer to the bulk packet tea and that is growing at the rate you mentioned. But, the tea bag segment is growing at 5o per cent plus rate annually for last 3-4 years, and TE-A-ME is present in the tea bag segment. The total tea market in India is upwards of Rs.30,000 crore but that includes loose tea, bulk packaged tea, tea bags, etc. Tea bag is a newer concept in India. It is a Rs.500-600 crore market in India, all brands put together. As consumers are getting busier, the tea bag is becoming the format of convenience for them. And, a bulk of this tea bag segment is led by green tea. The younger generation out there wants a quick cup of tea. Besides, a tea bag gives a consistent taste with every cup of tea.
Q: So, are you only present in the tea bag segment in India?
SP: Yes, we are, as of now, only in tea-bag segment in India. Over a period of time, we would definitely look at the packaged bulk tea segment, but we will always stay with our company ethos of offering unique, flavourful value-added products for the young Indian population.
Q: How do you position yourself in terms of pricing in the tea bag segment? Other brands like Twinings are quite expensive for an average Indian consumer.
SP: I`d say that we are in the economy plus segment in India in terms
of price. We don`t want to be only an affluent segment product. We are a tea drinking nation and tea originated here, so our products are relatively more affordable. We are proud to be a made-in-India brand. We are not a multinational brand. In fact, we have made our brands and launched them in the international market. We don`t have tea estates. We buy tea from all over the world as that allows us to select the right kind of tea, which will eventually suit the palate of our customers. We buy tea from India, Kenya, Sri Lanka, South Africa, Zimbabwe and many other countries.
Q: You are targeting young consumers, but they love having coffee these days.
SP: I have a different opinion there. It`s not really the coffee they love, but rather the format and the place where coffee is served. To my mind, it is the lifestyle which comes along with having coffee in a café, which is making coffee very popular. We are a tea drinking nation. We should have chai cafes. I am not saying young population doesn`t like coffee, but it is really selling coffee through cafes which has resulted in a sudden growth. Tea is also beginning to gain popularity among young people with brands like us making efforts.
Q: There is a huge lack of awareness in the tea market. People have their own perceptions. What can companies like you do to tackle this?
SP: You are right. There is a lack of awareness in this market. We are making efforts to deal with it. Unfortunately, on ground, India is a very fragmented market and the cost of reaching out to such a vast spread-out population is very high. But, we think over a period of time it can be handled by our initiatives like wet-sampling, wherein we make people have our teas at sampling kiosks and flavour station. We believe that when they taste our product, they will realize the difference.

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