Tetley joins the instant tea party

A heated marketing war is brewing in the tea industry as Lyons Tetley Canada moves to secure distribution for a new instant tea product similar to that introduced earlier this month by Thomas J. Lipton.Lipton launched its new Red Rose Instant...

A heated marketing war is brewing in the tea industry as Lyons Tetley Canada moves to secure distribution for a new instant tea product similar to that introduced earlier this month by Thomas J. Lipton.

Lipton launched its new Red Rose Instant Tea Granules March 15 with a tv campaign created by J. Walter Thompson of Toronto.

The introductory campaign, which has a budget of $650,000, is slated to run for six weeks.

Lyons Tetley is also planning a tv campaign as the primary advertising vehicle for Tetley Freeze Dried Instant Tea.

The campaign, created by Foster Advertising, is scheduled to launch in mid-May.

Alf Robinson, president of Lyons Tetley Canada, concedes his company was beaten to the punch by Lipton in launching an instant tea product to Canadian consumers.

But Robinson says ‘it’s a brand fight and we think we’ll do better.’

Both companies will be targeting a younger market, hoping the product innovation will cultivate a new niche of tea drinkers in the declining market for tea.

‘We’re expecting instant tea to create a lot of excitement and modernize the image of tea, making it a ’90s product,’ says Red Rose marketing manager, Rick Brown.

Brown says tv was chosen as the primary vehicle for advertising the launch of Red Rose Instant Tea Granules because it is the most powerful medium to create awareness of a new product. A newspaper insert will hit major markets in late April. Support will also be given by point-of-purchase advertising on store shelves and with coupons.

Robinson says he is reluctant to reveal more of Lyons Tetley’s marketing strategy but acknowledges advertising will continue to build on the quality image it has portrayed in past campaigns.

Neither company expects instant tea to replace the traditional tea bag.

Robinson estimates about 50% of instant tea consumers will be newcomers to the tea market.

The development of the product, which took years to perfect, is also a response to consumer demand for convenience, Brown says.

Most tea is brewed at home, but both companies hope the convenience of the new product will open the door to more tea consumption in the workplace.

Two years ago, Lipton and Lyons Tetley squared off over the u.k. instant tea market. Instant tea sales now accounts for about 5% of the total British tea market.

As it was here, Lipton was first to introduce the product into the u.k. and now enjoys a slightly larger share of that market.

The aggressive price wars that have historically been fought between the two rivals on the supermarket shelves are expected to continue with the arrival of instant tea.

Pricing for both Tetley and Red Rose instant teas will be between 7 cents and 8 cents per serving, compared with 3 cents to 4 cents for a regular tea bag.

The instant tea manufacturers are hoping to challenge beverage marketers outside the tea industry with their new products. The attempt to attract younger consumers is an effort to compete with the cold-drink market which has grown by four times in the last ten years, according to market-research firm A.C. Nielsen of Toronto.

‘What we’re saying to cold-drink consumers who like the convenience of instant drinks is that tea is now an alternative,’ says Brown.

Nielsen’s statistics show a slow decline in the tea market over the past 10 years.

Total category sales in Canada in 1992 were approximately $170 million with black tea making up $114 million of that figure – a 30 per cent decrease from 1982. Iced tea, instant and powdered, amounted to $40 million while herbal teas amounted to $15 million.

Lyons Tetley is the leader in the Canadian tea market with 30% of the total share followed by Red Rose with 23%.

Tetley targets its regular tea at consumers aged 35 to 54, but the target market for its instant tea is consumers aged 25 to 45. Brown says Red Rose’s target group is similar.

The Tetley product is packaged in an amber-colored jar that filters out light and is essential to the maintenance of the product, says Robinson. Red Rose is packaged in a clear glass jar.

The tea market in Canada is highly regionalized. The Atlantic provinces consume the most tea in the country on a per capita basis with Newfoundland leading the way.

Eastern Canadian tea drinkers prefer a well-steeped cup of tea, Albertans lead in the consumption of specialty blends, followed by Ontario.

Robinson says Tetley is hoping its freeze-dried instant product will perform strongly in Quebec.

‘Quebec holds a lot of promise because they drink a lot of instant coffee,’ says Robinson. ’20 to 25% of our Quebec consumers could be instant coffee drinkers,’ says Robinson.

Theinstant tea market might inadvertently get a boost from the Tea Counci,l which Robinson says is undertaking a publicity campaign to raise awareness of tea as a healthy alternative to other hot and cold drinks.

Brewed tea contains riboflavin, niacin, fluoride, zinc and potassium and has less than half the caffeine of coffee.