Mintel said the UK tea market grew 8 per cent in volume terms between 2008 and 2010 but dismissed the rise as a blip in the long term trend.
Jonny Forsyth, senior drinks analyst at Mintel, said: “The recent economic climate has played a big part in consumer attitudes to tea and two of the worst winters on record have also assisted the market, not to mention heavy discounting activity.”
Youth problem
However, the analyst said that in the long run the tea market in the UK suffers from its reliance on traditional tea and failure to convert younger consumers to the drink
Tea is failing to win over the next generation even if it remains the preferred drink among older consumers. Tea drinking is a ritual that 88 per cent of British people over 65 indulge in, but among the younger 15-34 age group, that figure drops to 73 per cent.
“Tea is capitalising on the short-term increase in the share of over-65s but failing to convert the younger generations in significant enough numbers to replace those falling out of the market,” said Forsyth.
Mintel attributed the 5 per cent decline in tea volumes between 2005 and 2008 to the failure of traditional tea to attract young people.
Herbal growth
But this is not all bad news for the tea industry for young people are much more likely to be among the 23 per cent of the population who drink herbal or specialty teas.
For example, Herbal tea sales are growing fast - up 11 per cent last year to hit the £80m mark. More work though is needed on the marketing side to attract people to these products.
According to Mintel’s research almost a third of standard tea drinkers do not believe in the health benefits of herbal/fruit teas. And seven in ten say they do not taste as good as traditional tea.
Forsyth said the tea sector “needs to do more to attract new consumers to the health benefits of herbal tea and the premium tasting benefits of speciality.”