New Delhi: Typhoo, the British packaged tea brand now owned by Kolkata-based the Apeejay Surrendra group, is seeking its fortune in a set of non-tea infusions, including organic herbal tea mixes.
Typhoo, which is among the world’s top tea brands, has been seeking new avenues to ensure growth like its peers, including India’s Tata Global Beverages-owned Tetley and Associated British Foods-owned Twinings, for the past few years with consumption of black tea witnessing “a secular decline", especially in evolved markets such as the UK – the third biggest tea drinking market. Besides, there has also been pressure on the production side across the world.
However, Typhoo India business head Subrata Mukerji said that infusions are growing “very fast". “That’s the way forward. Not just infusions. About a year-and-a-half ago, we started developing our organic and herbal tea portfolio." The company has already launched a set of organic and herbal infusions, which are not pure black tea. “These are more of tea-based infusions for health and wellness," he added.
Besides a range of fruit infusions, Typhoo has now launched non-tea organic herbal infusions that have ingredients like ginseng, ginger, cinnamon, turmeric, chamomile, spearmint, nettle, fennel, rose, lemongrass, senna, psyllium husk and liquorice, among others. These infusions have no tea in them.
“Consumers, especially millennials and the working youth, are preferring these more than black tea. The market for infusions is growing faster, while the pure black tea market is not. We are working on more such products that we believe will ensure consistent growth. However, the original packet-tea business is still the core," said Mukerji.
Typhoo, which was acquired by the Apeejay Surrendra group in 2005, is also working on tea-based ready-to-drink beverages and ready-mixes, which the company aims to launch in India within a year. “That will fast-track our growth."
He said infusions and herbal beverages account for about 25% of Typhoo’s business in the UK, its home market. The company’s global revenue is estimated at €85 million.
In India, Typhoo is targeting ₹ 100 crore revenue by 2021, from about ₹ 30 crore now. The company started selling packet tea and fruit infusions in India in 2007. The Apeejay Surrendra group also has a tea plantation business, which is estimated to generate ₹ 400 crore annually.
Typhoo’s rival in the UK and in India, Tetley, recently entered the squash category and launched Tetley Cold Infusions. Tata Global Beverages Ltd global chief marketing officer Adil Ahmed, in an analyst call earlier this month, said Tetley’s whole portfolio in the UK is changing more towards non-black tea category. Tata Global Beverages managing director and chief executive officer Ajoy Misra noted that Tetley has entered the squash category for the first time, considering that squash as a category, is as big as tea.
According to market research firm Euromonitor Internal, India’s branded tea market was estimated at ₹ 12,970 crore in 2017, against ₹ 12,240 crore in 2016. Of this, the non-tea infusions are at 4-5%, up from just about 1% three years ago, according to research firm Mintel.