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Tea time rides bubbles of new popularity

chinadaily.com.cn | Updated: 2020-12-04 10:50
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Enormous demand

Females are the core clientele across all age groups, contributing more than 70 percent of purchases, followed by post-90s males (aged 21-30).

"In China, new style tea drinks are driven by the pursuit of health and a more sophisticated taste in bubble tea," said Peter Wong, an analyst at market research provider Euromonitor International. "Before the boom of new style tea beverages, there had already been a great deal of street shops selling traditional bubble tea."

Overall, demand for bubble tea was rising, and shops, such as CoCo and Mixuebingcheng, tended to focus on medium- and low-income consumers, Wong said. Nevertheless, as disposable incomes increased, taste and demand among Chinese consumers rose. Key players such as Heytea and Naixue's Tea have energized demand via cheese tea and fruit tea and with the introduction of reduced-sugar options, he noted.

"These banners brought not only a more complex taste, but also an element of health and wellness to consumers. Likewise, their Starbucks-like stores present a comfortable 'third place' for customers," Wong said "Therefore, even though both are high-end beverages, consumers are still willing to pay a premium for them. Consumers have steered their bubble tea consumption toward greater sophistication, trading up from street stalls to salubrious cafes."

According to Euromonitor International, Heytea and Naixue's Tea in China grew at compound annual growth rates of 53 percent and 368 percent, respectively, in 2015-19.

The booming bubble tea industry "should serve as a prime example of the country's consumption sophistication across wide-ranging industries," Wong said.

From the mass offerings of roadside stores like CoCo and Mixuebingcheng to the roaring success of Heytea and Naixue's Tea, with the meteoric rise of the Chinese economy, "the entire bubble tea consumption trend has been enhanced, in a sense that sophisticated consumers will now have greater demand for bubble tea and bubble tea shops, from pursuing different tastes in their beverages to having an ambience for their drinks", he said.

For years, the dizzying growth of the world's second-largest economy has given birth to a new breed of "super consumers", who have gone beyond mimicking the patterns of the more sophisticated Western shoppers to being trendsetters and innovators.

Deemed as one of the most remarkable footnotes to the nation's growth story, they are known to be enamored with top-shelf brands and vote for quality within their reach.

To be sure, it's by no means an easy task to understand these super consumers. Peng Chaoman, a franchisee of milk tea chain Yi Dian Dian in Chengdu, Sichuan province, highlighted the concept of "punk wellness" among young people - a madly popular concept referring to youth who want to be healthy, but still indulge and stay up late.

"There are an awful lot of research findings warning that a cup of milk tea can contain a meal's worth of calories or caffeine equivalent to eight cans of Red Bull," Yang said. "Our attitude is: Stay calm and drink on. Then let's work out in the gym."

"When we develop new products, a delicate balance must be struck between consumers' pursuit of wellness and their desire for a taste flash and having fun," Peng said.

Though critics may argue that the highly sought-after milk tea brands are just a product of well-crafted "hungry marketing" and whimsical branding, it cannot be denied that they have been successfully riding on the rising wave of social media influencers and online lifestyle publications, fitting in well with the "camera eats first" and "pretty is power" culture in an aesthetics-driven era.

"For a new generation of fad-hungry, selfie-snapping customers, bubble tea becomes more of a new form of social networking," Yang said. "The latest fads and most trending news about the sparkling drinks and promotions always allow me to pick up the threads with ease in daily conversations."

The traditional beverage has been reinvented for a new generation of fans, as a pretty cup to carry around, a delicious drink to share with intimates and a perfect theme for an online post. More importantly, just like Starbucks took off in China by combining convenience with a desire to denote cosmopolitanism, phenomenally popular milk tea brands also look to sell an appealing urban lifestyle.

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