Consumers are becoming aware of how healthy tea might be. But what about pomegranates?
When Stewart and Lynn Resnick, the owners of Los Angeles-based Pom Wonderful LLC, conducted research at the start of their business, less than 12 percent of the public knew what a pomegranate was. When the Resnicks purchased a 100-acre pomegranate grove in 1987, they were encouraged to chop the entire orchard down since there was virtually no market for the hard-to-eat, inconvenient fruit.
Pom Wonderful LLC's Pomegranate Black Tea combines tea and pomegranate juice that allows for a milder yet distinctive flavor.
That's no longer the case. While figures are hard to come by, it is estimated the distinctive bulbous bottle and effective messaging has catapulted Pom Wonderful from $12 million in sales in 2003 to $91 million this year (according to an Aug. 7 Newsweek article).
How do you keep a product going with such a distinctive flavor as a pomegranate? Well, you listen to the voice of the consumer, which tells you the current product is too strong, too astringent and not sweet enough. Maybe you blend together two healthy ingredients - tea and pomegranates - to up the ante on healthy teas and juices.
That's what Pom Wonderful has done with Pomegranate Black Tea. The combination of tea and pomegranate juice allows for a milder yet distinctive flavor, an elixir of different antioxidants at a meaningful level that are naturally occurring and very easy to drink. The question is: Given the healthy and probably deserved halos of tea and pomegranate juice, will consumers want a healthier tea or juice or just one that tastes good?
Understanding the marketplace
Tea is a $1.7 billion category with 4.3 percent growth between 2003 and 2004. The growth has been in ready-to-drink (RTD) tea in bottles or cans, with sales of $631 million and a growth rate of 13.3 percent. Tea loose or in bags has $694 million in sales and a growth rate of 3.6 percent. Instant iced tea mix has $267 million in sales and a growth rate of -4.6 percent. Refrigerated tea, although just $142 million in sales, grew 23.5 percent from 2002 to 2004 (all according to Information Resources Inc. figures, excluding Wal-Mart).
Tea is the lower-caffeine, healthier version of a brown beverage with many exotic options. Top brands of RTD iced teas include Lipton, Nestea, Snapple, Arizona, Crystal Light and store brands. Just as many of these brands also appear on other beverages, tea, especially ready to drink, is being successfully marketed as a soft drink.
A key point is consumers are looking for unique beverages that deliver an added plus: healthy ingredients. Pom Wonderful, having already attracted people's attention with the juice and blends and a cool bottle, has created a new line to build upon the education base and continue the buzz.
Cold teas are chosen based on taste, aroma and beverage temperature. They are refreshing because they are icy cold, not too sweet and have well-blended flavors. Teas are of the brown beverage group (coffee, tea and cola), which is the reference point for all beverages. They are consumed across all day parts, but can be found more often at lunch, in the afternoon and with dinner.
Drink It! is our process to integrate 30 conjoint studies to generate a database that can be used to understand the experience of beverages. From the data, we see RTD tea is not about the bitter aftertaste often associated with hot tea or some instant iced teas, but it may have a sweet-bitter note. RTD tea flavors that consumers are looking for are fruity, berry flavors, not a creamy or traditional flavor. Tea is a beverage that goes with TV watching and playing on computers. It's considered just as natural a beverage as water. Tea is an emotional experience that relaxes you after a busy day. It fits our lives today.
It also provides a form of health insurance … of potential health benefits, just in case you need them. Consumers want these health benefits to be naturally occurring, however.
While flavor extensions and calorie variations have been the traditional paths forward for most beverage makers in recent years, consumers will accept only so many line extensions before looking for alternatives - either a wholly new beverage or a more premium traditional beverage. Premiumness can be defined by both flavor and what other attributes, including health, are brought into the mix.
Key trends impacting the category are freshness and premiumness.
Freshness: In a bottled tea beverage, freshness can be perceived by consumers to come from the flavor. The fruitier flavors are perceived to be fresh. Glass packaging also says fresh. Glass bottles took this once humble beverage category to another level.
Premiumness: The premium perception in teas always has come from the exotic blends of oils and tea leaf types, but with the bitter overtones subdued. Adding fruit flavors can smooth out the bitter overtones; they also give a fuller taste and perception of better mouthfeel. So much the better if you use an unusual fruit.
Pom Tea is available in a 13.5-oz., shrink-wrapped, glass container. The current line-up pairs pomegranate with black tea, lychee green tea, peach passion fruit white tea, blackberry black tea and POMx (a highly concentrated blend of juice). The price point can vary anywhere from $2.49 to 2.99. When the lid and shrink wrapper are removed, you are left with a drinking glass of tea, not a jar or bottle. The Pom logo with the heart has a leaf with "tea" written on it. The flavor of Pomegranate Black Tea is listed right below the logo.