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Cold, bottled and 'ready to drink,' the new face of tea consumption A variety of ready-to-drink tea beverages, including YES's 681/4C Healthy Tea Comes (insert), are displayed on convenience store shelves June 15. (Courtesy of YES)

Publication Date:06/22/2007 Section:Economy     By Edwin Hsiao

With the approach of summer, the peak season for soft-drink consumption, beverage companies in Taiwan are gearing up to wage their intense annual marketing campaigns.

In March 2005, Young Energy Source Co. Ltd. became the first Taiwanese beverage manufacturer to launch "fat-reducing" green and oolong tea drinks bearing the names "Healthy Tea Comes," in Chinese. Two years to the month later, YES launched two new unsweetened green tea and high-altitude tea products called "681/4C Healthy Tea Comes," which, the company claimed, used state-of-the-art low-temperature technology to retain a more authentic flavor.

Taiwan's tea-beverage market was highly competitive, Judy Chen, special assistant to the YES chairman, confirmed in a June 12 e-mail interview. The latest trend, she added, was that consumers now chose products that were increasingly healthy and contained no artficial flavoring, as well as those that quenched their thirst.

"YES has exclusively brought Japanese technology that uses far infrared rays to treat tea leaves at 68 degrees Celsius," Chen said, claiming that "the lower temperatures overcome problems associated with traditional tea-producing technologies, and thus preserve 100 percent of the tea's polyphenols and 100 percent of its aroma. This makes our teas more healthy and taste better."

Taiwan's beverage market was worth almost US$1.5 billion in 2006, representing a 3.1-percent growth over 2005, according to Taiwan Beverage Industries Association statistics quoted in a Chinese-language Commercial Times report May 16. Of these various beverages, tea products were unquestionably most popular, with sales of more than US$600 million or 42 percent of the total market, the report continued.

Thirty-two beverage manufacturers launching new products in 2006 focused on tea drinks, a news release posted March 28 on the Web site of the privately run Food Industrial Research and Development Institute indicated, and, out of 327 new "ready-to-drink" products introduced last year, 119 were tea drinks, predominantly green, milk and fruit-flavored teas.

In addition to stressing the origins and qualities of their products, beverage companies attempted to add new ingredients, such as polyphenols extracted from guava leaves, which were claimed to reduce absorption of starch and other carbohydrates, FIRDI stated.

This health-conscious trend away from stimulant sodas and toward teas and juice drinks--a market opportunity for beverage manufacturers--could be the result of life-style changes, National Sun Yat-sen University business management graduate student Hung Ying-chen wrote in her June 2006 master's thesis, "The Future Trend of Fast-Moving Consumer Goods in Taiwan." Hung particularly identified the aging of Taiwan's population, increasing number of women in the work force, growing number of people dining out, smaller family size and faster paced lives as contributing factors.

"Mine Shine," a black-tea product made by Uni-President Enterprises Corp., may have started the trend toward ready-to-drink tea products in the 1980s, suggested an article titled "Gee it's hot. I need a cold drink" in the March 2007 issue of American Chamber of Commerce in Taipei's Taiwan Business Topics magazine.

In those early days, such products were little more than tea-flavored drinks, however, and the fad did not take off in earnest until Sinn Si Industrial Co. Ltd. launched Kaisi Oolong Tea in 1990. This product was marketed as an intimate part of Taiwanese culture; its television commercial, for example, emphasized "the need to place a bottle of chilled oolong tea on every table at wedding banquets," the Topics article continued. At its peak in 1991, sales of Kaisi Oolong Tea totaled US$181 million a year, and contributed to growth of the tea-sector value from US$218 million in 1991 to US$351 million in 1993.

Although black-tea drinks started the trend, the spotlight subsequently moved on to semi-fermented oolong teas, floral teas, milk teas and now, influenced by the Japanese, green teas, the article continued. In line with the greater attention to health, there was increasing acceptance of non-sweetened green tea drinks, with the sugar-free or low-level of added sugar clearly marked on the packaging.

Special marketing channels and advertising were seen as key to these developments, the Commercial Times reported, citing ACNielsen Taiwan statistics. Convenience stores, it stated, commanded more than 50 percent of market shares for many categories of ready-to-drink products, especially chilled beverages including coffee, juice and teas.

Catechin, an antioxidant present in green tea, captured people's attention, Esther Lin, manager of Corporate Communications Department of the convenience store chain FamilyMart, wrote in a June 11 e-mail interview that items making pledges to be "unsweetened" or "fat-reducing" were especially popular. During Taiwan's hot and windless summers, when the need for iced drinks spiked, tea drinks therefore satisfied consumers in a variety of ways, she added.

As for future developments, even though unsweetened was the current trend, Lin predicted that tea-drink manufacturers would have to balance ingredients against taste, referring to the astringent quality of unsweetened teas. "They won't buy the product simply for health reasons," Lin stressed.

A second trend was the "specialization" of tea drinks, she said, noting two major directions under this heading: emphasizing the tea's functions or origins. She gave as examples AGV Products Corp.'s "Mitsuba Kanten White Tea," which claimed slimming attributes, and Wei Chuan Foods Corp.'s Kyoto Uji Green Tea, which used Japanese leaves.

Yet another trend Lin pointed to was "authenticity." Japanese brands already claimed to reproduce almost exactly the real taste of freshly brewed tea, and Taiwanese teas were trying to close that gap.

Uni-President was the nation's largest tea-beverage maker, with sales of US$293 million in 2006, representing a 44.7-percent market share, according to ACNielsen Taiwan's figures. These also indicated that, from January to April 2007, three out of the company's seven tea brands were among the island's top 10 brands.

Uni-President does not currently focus on tea drinks with special functions, Yeh Hsi-ping, vice director of the company's Tea Beverage Division, stated in a June 11 e-mail interview. Yeh added, however, that Uni-President still took "health-orientation" as one of the fundamental concepts considered when developing new products. Using the company's 2002 "King among Teas" brand as an example, Yeh said all products under that brand were either unsweetened or lightly-sweetened, and, moreover, in 2005, the brand's unsweetened Japanese-style green tea was granted with the health food permit by the Cabinet-level Department of Health, becoming the first tea drink so certified.

Regarding targeting of consumers and advertising, Yeh said, "Since consumers of ready-to-drink tea beverages are ordinary people who do not belong to one specific demographic group, we focus advertisements on the mass media for wide promotion, in the aim of creating good images and high recognition of our brands in the minds of many consumers."

"Because green tea is healthy and makes the perfect after-meal drink, the preference for green tea would continue to be the main trend in years to come," Ewing Lin, marketing and planning division manager of beverage manufacturer Kuang Chuang Diary Co. Ltd., said June 20.

Write to Edwin Hsiao at edwinhsiao@mail.gio.gov.tw

Taiwan Journal

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