Last year, Nestea, a venerable tea brand owned by Nestlé since 1948, changed its bottle size and introduced several new flavors, including iced tea with peach, iced tea with raspberry, and iced tea lemonade to complement a diet iced tea with lemon. Its sculpted 23-oz PET bottles not only contained more tea, but importantly it was better tea.
It was another step in the evolution of the brand, but not a leap.
“The old Nestea was not delivering on the evolution of tea,” Cassin Chaisson, tea director at Nestlé Waters North America told Beverage Daily.
“Consumers are looking for something that gives them great drinkability and immediate refreshment in that moment,” she said. “It’s not just the product in the bottle, it’s that experience of drinking tea.”
The range added herbals as well and featured a red tea with pomegranate passionfruit. In Canada, the line included blackcurrant iced black tea and blueberry mint green tea, responding to market research showing that iced tea drinkers are looking for a larger variety of choices, explains Angela McIntosh, integrated marketing manager for Nestea at Coca-Cola (Canada).
The four most popular tea flavors listed on restaurant menus are raspberry, peach, mango, and tropical, according to research by Datassential for S&D Coffee & Tea, the largest iced tea supplier in the U.S. But exotic new flavors are making headway. Datassential reported that in restaurants currently serving iced tea, menu penetration was only 0.6% for lychee flavored tea but the adoption is up 36% in one year and 684% in the past four years. Jasmine tea is now listed on 1.1% of restaurant menus (up 32% in the past year and +437% over four years). Taro appears on only 0.8% of restaurant menus, but showed a 21% gain in the past year and +412% growth over the past four years.
In a report in Beverage Daily, Nestlé Waters North America describes a split between tea drinkers who prefer teas infused with fruit flavors and those seeking “real tea.”
To address this split, Nestea in 2017 will launch a “real brewed tea” line at $1.79 alongside its fruit-flavored (lemon, peach, and raspberry) iced teas for $1.49. The real brewed tea will be an unsweetened and a slightly sweet black tea, a slightly sweet rooibos, and a USDA-certified organic green tea, available in a wide-mouth PET bottle in singles and six-packs. The company also refreshed its Nestea logo and will launch a significant advertising and social media campaign.
Chaisson said the company is targeting millennials. Researchers find this cadre of 80 million people is more likely to pay a higher price for premium and single-sourced tea compared to other age groups. Datassential found 63% of millennials (vs. 53% of tea drinkers) prefer flavored iced tea. Artisan iced tea is preferred by 54% millennials (vs. 42% of tea drinkers). Among tea drinkers, most (56%) prefer the flavor in the tea itself instead of from flavored syrup.