Sugar-free tea “Dongfeng” is blowing strong, and beverage merchants are accelerating the launch of new products.2024The year was also evaluated by beverage industry insiders as a 'battle of a thousand teas'. Dayaoyao, which has always been centered around cola as its core feature, recently announced its launch3The new products of the Camellia series include Golden Osmanthus Oolong, White Orchid Oolong, and Oolong Tea. The formula emphasizes0sugar,0fat,0energy. Can Dayao make good sugar-free tea? What is your opinion on the trend of "water substitution" in sugar-free tea? Is it necessary? How do you view the "thousand teas battle"? Is it beneficial to the industry's development? Will it affect the industry pattern? What will be the "main battlefield" for future competition in sugar-free tea?
Frost & SullivanFrost & Sullivan,Guan Mengying, a consulting analyst at Frost & Sullivan's Greater China region and referred to below as 'Frost & Sullivan', was interviewed by Blue Whale News to discuss the future development of the sugar-free tea industry.
Blue Whale News
*Click at the end of the article Read the original text View the full report
Q: The main business of Dayao is soda. Do you think it can make sugar-free tea well?
Dayao can make sugar-free tea well. Firstly, Dayao's existing extensive sales channels and mature marketing network are significant advantages for its entry into the sugar-free tea market. By seamlessly connecting these resources from the soda business to sugar-free tea products, Dayao can quickly penetrate into the target consumer group while maintaining brand influence. This channel reuse strategy can greatly reduce the market entry threshold and accelerate market acceptance.
Furthermore, with the continuous enhancement of public health awareness, the sugar-free beverage market, especially sugar-free tea drinks, is in a state of high demand but still lacking in supply. Dayao's timely launch of sugar-free tea products can just fill the market gap and meet the needs of consumers who seek healthy drinks but are unwilling to compromise on taste.
Finally, the differentiated strategy of Dayao in product positioning is also a key to its success. Whether it's soda or sugar-free tea, Dayao is committed to creating product images that are closely connected with dining scenarios, emphasizing a unique experience paired with delicious food. This not only strengthens the brand's differentiated positioning but also makes full use of its expertise in creating dining culture.
Q: What's your opinion on the trend of 'water replacement' in sugar-free tea? Is it necessary?
With the improvement in consumer power in first- and second-tier cities, the user base of sugar-free tea has expanded from those who control their sugar intake and exercise to a broader range of general consumers. For white-collar consumers in these cities, sugar-free tea is convenient to obtain and has a taste similar to flavored water, thus gradually replacing daily drinking water. Although the price of sugar-free tea is higher than that of regular drinking water, considering the rapid development of Luckin Coffee, consumers in these cities are less sensitive to the prices of low-price fast-moving beverages, so sugar-free tea still has the potential to further replace bottled water.
The trend of sugar-free tea as a 'water substitute' is becoming increasingly significant, mainly driven by the heightened health awareness, deepening market education, product diversification, and changes in lifestyle. The public's increased attention to sugar intake has made sugar-free tea an ideal choice for those seeking a healthy lifestyle due to its health benefits. Market education and the introduction of diverse products, such as cold brew tea and fruit-flavored tea, have not only enriched consumers' choices but also attracted the interest of younger groups. In the fast-paced modern life, convenient and refreshing sugar-free tea meets the thirst for hydration and is gradually becoming a 'water substitute'.
This trend is of great significance in two aspects: guiding the public to form healthier living habits and promoting industrial upgrading. Firstly, from a public health perspective, high-sugar diets are closely linked to health problems such as obesity, diabetes, and cardiovascular diseases. Promoting sugar-free tea as a 'water substitute' helps reduce sugar intake and improve public health conditions. Secondly, from the perspective of industrial upgrading, this trend encourages enterprises to innovate and develop more low-sugar and sugar-free products, promoting industrial upgrading, enhancing competitiveness, and also bringing new growth points to agriculture, especially tea cultivation.
Q: What's your opinion on the 'Thousand Teas Battle' and whether it is beneficial to the industry's development? Will it affect the industry landscape?
The 'Thousand Tea Battle' is an inevitable result driven by the convergence of health trends and consumption upgrades. With the awakening of public health awareness and the increasing demand for quality of life, sugar-free tea, as a beverage that combines health and taste, has seen a surge in demand. This has not only spawned a vast market blue ocean but also attracted many brands to compete for a share.
The 'Thousand Tea Battle' is beneficial for the development of the industry. It has stimulated innovation within the sector, with brands competing to launch new products, not only enriching their product lines but also promoting technological progress and quality improvement in healthy beverages. Competition forces companies to strengthen brand building and market segmentation, effectively enhancing consumers' awareness and acceptance of sugar-free tea and broadening market boundaries.
The 'Thousand Tea Battles' accelerated the reshuffle process in the sugar-free tea industry, with market resources gradually concentrating on leading enterprises with brand influence, technological innovation capabilities, and efficient supply chain management, leading to an increase in industry concentration. In addition, market differentiation is evident, with brands that are distinctive and capable of meeting specific consumer needs more likely to stand out, while small brands lacking competitiveness face survival challenges. Although this process is accompanied by short-term market fluctuations, in the long run, it is conducive to building a more mature, stable, and innovation-driven industry pattern.
Q: What do you think will be the 'main battlefield' for competition in sugar-free tea in the future?
The core competitive points for the future sugar-free tea market will focus on 'health quality and innovation'. Against the backdrop of increasing consumer health awareness, products are not limited to meeting basic requirements such as being sugar-free and low in calories. Instead, they should strive for the selection of tea raw materials, the refinement of natural flavors, and the application of innovative technologies. For example, exploring natural sugar substitutes and enhancing the functional aspects of tea drinks (such as aiding sleep and refreshing) to meet consumers' complex needs for health, deliciousness, and functionality. At the same time, in line with modern consumers' pursuit of novel experiences, they continuously innovate, such as launching seasonal limited teas and cross-border tea blends, to create differentiated health beverage experiences. This helps them stand out in a homogeneous market, build strong brand loyalty, and lead the new trend of sugar-free tea drinks.
In addition, the domestic sugar-free tea market is in a stage of rapid growth, with an endless stream of new products emerging, but a stable taste pattern has not yet been formed. In the future, the development of sugar-free tea flavors will become one of the main competitive directions for the industry. By continuously innovating and introducing diverse flavors, brands can not only meet the taste preferences of different consumers but also gain an advantage in the fierce market competition.
*This interview has been published in Blue Whale News The reporter is Zhang Jinglun, and the original title is: 'Dayao Advances into Sugar-Free Tea, Joining the 'Battle of a Thousand Teas''.
Recommended
Consumption, as one of the 'troika' driving economic growth, is increasingly becoming a fundamental force in driving economic expansion and is the 'ballast stone' of the macroeconomy.2023The annual Central Economic Work Conference proposed 'to stimulate potential consumption' and 'to shift consumption recovery from post-pandemic to sustained expansion', followed by the Ministry of Commerce2024The year is designated as the Consumer Promotion Year. Overall, since the end of the pandemic, market vitality has been gradually released, China's economic condition has been effectively improved, and the consumer market has also been restored in an orderly manner. Food and beverage consumption remains at the top of residents' expenditure, characterized by rigid demand, high frequency, repetitive consumption, and resilience against cycles. It shows strong tenacity during economic cycle fluctuations and steadily increases. In today's 'volume contraction era', food and beverages have become the 'anchor' for stabilizing the consumer market.
2024year8month30Today, Frost & Sullivan will2024The New Consumption and Food & Beverage Industry Investment Summit grandly released "Food as the Nourishment of Life:2024"White Paper on China's Food and Beverage Industry" delves into the market dynamics and development trends of China's food and beverage industry over the past year, focusing on new scenarios, new engines, new patterns, and new trends. It aims to interpret the current development status and future prospects of China's food and beverage industry from a scientific, rational, and professional analytical perspective. The paper also organizes leading enterprises to discuss the development trends and growth paths of the food and beverage industry from their respective perspectives, helping industry insiders identify potential growth points and break through the challenges currently faced by the food and beverage consumption industry.
Learn more about the meeting details👇
🔗 50+Industry expert leader, Frost & Sullivan2024The New Consumption and Food & Beverage Industry Investment Summit invites you to meet in Shanghai in August
