"The world's first black tea brand" can not stand up?
On November 9, 2021, FMCG giant Unilever officially announced the sale of its global tea business Ekaterra to PE giant CVC Capital for 32.7 billion yuan, including 34 brands including Lipton.
In 2008, a xinhua news agency reported that "70,000 tea companies are not as good as one Lipton", which shows lipton's influence. According to Tianyancha data, in 1999, Lipton's marketing volume was close to 3 billion US dollars, and the sales were still outstanding today more than 20 years later, and the "world's first black tea brand" was worthy of the name.
Lipton is worthy of unilever and is a "humerus minister". Unilever's tea business began with the acquisition of Lylton, and since then it has become the current Ekaterra by continuously absorbing and developing more brands. It can be said that Unilever's tea business can become the world's first, and Lipton's contribution is indispensable.
Since 2019, the news that Unilever is going to sell Lipton has been circulated on the Internet, and since then, the rumors have continued, and today, Lipton has officially been "abandoned". At the same time, the five flavors are mixed and old, and it is inevitable to sigh: a generation of tea kings, dying of old age. Was Lipton sold as a business strategy? What is the reason behind the decline in its business? Has the spring of domestic tea brands arrived?
First, why was the 130-year-old tea giant abandoned?
Lipton was sold for early indications. According to Tianyancha data, from 2014 to 2019, Lipton's global sales decreased by about 8%. For its old club, Unilever, Lipton has lost its growth momentum, which means losing the value of the invested funds.
According to Unilever's usual business strategy, it is inevitable to "cut fat and raise thin", cut off the sector with insufficient strength and develop a more profitable sector, such as skin care products and cosmetics. Lipton is not the only one that was cut off, in 2018, Unilever sold its slow-growing margarine and spread business to another PE giant, KKR, for $8 billion.
The reason lipton was sold is also obvious.
One is that the brand is aging and cannot catch up with the trend of tea development. In terms of taste and quality, Lipton usually uses tea powder after crushing, shredding and rolling, although it can quickly produce a taste, but the taste is not good, for the discerning tea customers who pay attention to "one water, two teas, three or four are the essence", this is only a low-end tea drink.
In addition, as early as April 2012, Lipton was exposed to the use of Sino-European double standards, and the samples of "Lipton" green tea, jasmine tea and Tieguanyin sent for inspection all contained the banned highly toxic pesticide antidovir, and the pesticide residue heavy metals seriously exceeded the standard, which pushed Lipton to the forefront. Although there were few quality problems later, the brand image was compromised.
From the appearance point of view, Lipton has always used the traditional yellow brand black tea packaging, although it has laid a brand identity, but it lacks novelty and cannot cater to the preferences of young people.
From a marketing perspective, Lipton's presence is low when it comes to social media and private domain traffic. Although wu lei, a traffic star, was signed in 2018, reached a cooperation with the popular variety show "Please the Refrigerator" in 2020, and officially announced Ouyang Nana as a spokesperson in 2021, the effect was not good, and it could not reverse the counter-trend of insufficient sales momentum.
The second is that the tea market is huge, and competitors are emerging in an endless stream, dividing the track. The Unilever chief pointed out that consumers' shifting more attention to coffee has led to a slowdown in the growth of its tea business. From the perspective of global consumption trends, with the continuous growth of consumer demand for coffee, the coffee industry has soared in recent years, directly affecting the market share of tea and making the tea market more competitive.
Of course, because the tea industry has joined many new players, such as the main tea bag tea, tea holes, etc., as well as the newly emerging tea yan yue color, hi tea, Nai Xue tea and other new tea drinks, these brands are not only rich and diverse in taste, but also packaging and publicity are more in line with the aesthetics of young people, which undoubtedly brings a greater impact to Lipton.
Second, the tea bag market is surging and the oriental tea leaves usher in spring
Even Lipton, which makes black tea the world's first brand, cannot escape the fate of being sold, which brings a huge impact to the tea market, but behind Lipton's "people walking tea cool" is an important opportunity for the development of China's tea bag market.
According to the data, the average proportion of global tea bag tea in the total consumption of tea category is 23.5%, but only 5% in China, far below the global average, which shows that there is still a large room for development in China's tea bag market.
China has a thousand years of tea history, tea culture is deep, many consumers still hold the stereotype of "poor quality of tea bags", but this has nothing to do with the quality of tea bags themselves.
However, driven by the Internet, many tea bag merchants have poured into the field of e-commerce, further expanding the scale of the online market for tea bags, and also showing many development trends, Oriental Tea is about to usher in spring.
According to the survey, the top five types of tea bags preferred by Chinese consumers are: herbal tea (55%), original tea (49.5%), functional tea (40.3%), mixed tea (27.8%), and grain tea (25.8%). The rich product range provides consumers with more choices, among the many types of tea bag products, peach or grape plus oolong tea in fruit tea is especially loved by young people, and the sales volume has ranked first in Tmall tea bags for many times.
The abundance of raw materials and patchwork varieties makes the taste of tea bags diversify and develop youthfully. Moreover, in order to meet the needs of consumers for low sugar and low fat, "0 calorie 0 fat" tea bags have also come into being, and tea bags have become healthier and healthier.
From the product side, the reason why domestic tea brands are gradually moving towards the "year of the fight" is that the quality has begun to improve visible to the naked eye, and there are broken teas in the tea bags in the early years, and there are also whole teas, and the quality is uneven. As far as broken tea is concerned, its source is mostly unknown, and there are some practices of using low-grade tea and scraps to crush into shards and put them into bags to make tea.
However, the current tea bags have made significant improvements, such as the use of transparent packaging bags, so that consumers can clearly see the tea leaves in the bags. And with the expansion of the domestic tea market and the rise of local tea bags, the market has produced a series of standards to ensure the quality of products.
From the marketing side, online young product marketing has increased publicity. On social platforms where young people are more gathered, such as Xiaohongshu, Weibo, B Station and Douyin, there are a large number of videos and notes to retrieve tea bags, with a wide variety of types, and they are overwhelmed, which shows the heat of tea bags.
Many tea bags are good at using social media for publicity, such as tea, tea color, etc., which interact with fans through platforms such as Weibo and WeChat, which can not only understand the needs and psychology of consumers, so as to improve products, but also attract consumers to continue to consume and improve user stickiness. Similarly,
Third, the fiercely competitive tea bag market who can laugh to the end?
Although Lipton was sold by Unilever due to insufficient development momentum, the data shows that lipton's market share of offline channel tea bags in 2019 exceeded 70%, and the market share of China with inspection in 2020 still occupies the first position, coupled with Lipton's continuous attempts to innovate in recent years, it has saved some people's hearts, and with the blessing of CVC capital, the future development potential cannot be underestimated.
At present, the tea bag track is hot, new brands are constantly emerging, competing for high, although compared with Lipton, sales are not in an order of magnitude, but it is highly sought after and loved by young people.
It is worth noting that China's tea-producing areas and tea brands have long been in a highly unequal situation, many tea brands often "rely on" tea origin, by geographical segmentation, regional taste distribution is also more obvious, such as Fujian, Guangdong tea culture is strong, the northern region is more cold, whether it is tea culture or tea brand, in the vast Chinese market, want to grow into a "super" tea brand like Lipton, still need more cultivation.
Resources:
Data source: Ai Media Consulting, Tianyancha
Image source: Network
Ai Media Consulting | the survey and analysis report on the current situation and consumption trend of China's tea bag industry in the first half of 2021
How does Lipton leverage the 10 billion-level tea market?