29 June 2017
Teen Tea Drinkers and Brand Extension Cause a Stir at China Tea Show
- Photo: Par-tea time: Bosizhuo’s Alice in Wonderland-themed afternoon treats.
- Photo: Yingde’s black tea range.
- Photo: Tea tasting time at the expo.
- Photo: Cold-brewed Shizu Zen tea.
- Photo: Chensheng Fuyuanchang’s pu’er tea.
- Photo: An award-winning tea corner.
- Photo: Exotically-packed tea products from Yulin Guchafang.
This year's Tea Expo Guangzhou saw a shift towards targetting the younger generation of tea drinkers, while many operators in the sector looked at diversifying their tea-related activities into rural tourism and the hospitality sector.
According to figures released in March this year, the 2017 spring tea harvest was a little down compared with the same period last year, although the overall quality was said to have been maintained. As a result, the Guangdong Tea Profession Association, the local industry body focussing on the sector, has indicated that the average price of spring tea recorded an overall rise for 2017.
Against this somewhat upbeat backdrop, then, this year's Tea Expo Guangzhou returned to the China Import and Export Fair Complex. As a sign of the buoyancy of the industry, this year's event added an extra pavilion – taking the total to six – while the overall fairground extended across an area of 60,000 sq m.
With its remit extending across all of the six major categories of Chinese tea – green tea, white tea, yellow tea, oolong tea, black tea, and pu'er-type tea – the event also maintained a focus across the entire industry chain. This saw it attract delegations from all of China's key tea-producing regions, including Jiangxi, Guangxi's Wuzhou, Yunnan, Yingde (Guangdong) and Xiangxi (Hunan), while 10 industry symposiums were also held during the event.
Among this year's exhibitors, it was widely noted that mainland consumers now, more than ever, are looking for value for money from their chosen tea products. As a result, the more expensive teas are being left on the shelves in favour of those available at a mid-market price range.
Among the other trends, was a widespread movement for producers to develop proprietary brands, while many established retailers/distributors in the sector were looking to diversify their operations. In another change – and one seen has having long-term and widespread significance – young tea drinkers are now seen as driving the sector.
It was clear this year that connoisseurship was on the up among tea drinkers. This saw many visitors to the expo keen to exchange views with exhibitors and learn more about the products on offer. Overall, it was products in the RMB100-1,000 per 500g price range that were most in demand.
Well within this range were the mid- and high-end black teas available from Yingjiuhong, a leading Guangdong-based tea producer. According to General Manager Wang Guangping, Yinghong No. 9 was currently the company's most popular product, with most of its range selling for between RMB200 and RMB500 per 500g.
In line with the growing product knowledge of many consumers, Wang noted that the black tea produced in Yingde, Yingjiuhong's home city, has become increasingly popular in recent years. In fact, Yingde is now one of the three most well-regarded varieties of black tea, alongside Qimen (Anhui) and Dian Hong (Yunnan).
For its part, the company's Yinghong No. 9 blend has a distinctly sweet aftertaste and an unmistakable curly, black appearance. Wang sees its continuing popularity as at least partly due to its general health benefits, particularly with regard to the digestive system.
Explaining his company's pricing philosophy, Wang said: "We believe, as a consumer product, tea should be priced so as to be affordable by the general public. It should not be exclusively accessible by the rich, like some rare antique."
Despite this, Yingjiuhong also offers a range of teas priced at about RMB3,000 per 500g, with Wing acknowledging that only a very small number of high-end customers are tempted to buy these premium products. He also emphasised that black tea – unlike pu'er tea – only has a limited shelf life and has to be consumed within a few years, rather than kept as an investment for future trading purposes.
Looking more specifically at the pu'er sector, it was widely felt that this particular tea variety no longer commands the excessive prices it did just a few years ago. In line with this, Zeng Shuyan, General Manager of Chensheng Fuyuanchang, a Yunnan-based pu'er tea producer, believes that the current aficionados of the blend buy more on the basis of quality and taste than just opting for the tea with the highest price tag. Summarising this, he said: "Pricy pu'er is the product of the speculative market. True pu'er drinkers, however, savour the taste of the tea, rather than flaunting its price tag."
Pu'er, of course, is different from many other teas in that its aroma is enhanced by age, making it, potentially, a good investment. The mid-range pu'er, which is particularly popular at the moment, may end up being worth far more than its current purchase price some five to 10 years down the line.
Diversification and Brand-Building
For many exhibitors, the past few years have been a period of diversification. This has seen tea producers and distributors branching out to set up teahouses and tea kiosks, developing e-commerce channels, supporting rural tourism programmes and the promotion of Zen tea culture.
One company at the forefront of a number of such initiatives is Guangxi-based Wuhuangshan, which bills itself as a new form of eco-agricultural technology company. Operating out of the Wuhuangshan National Geopark, the business provides an eco-agriculture demonstration platform for innovative farming and breeding programmes, as well as forest tea production and rural tourism.
According to Ding Jianghu, Wuhuangsha's Sales Director, the company is planning to build a four-star hotel inside the 33 sq km geopark. This will provide accommodation for the many tourists looking to explore the rural environment, help harvest tea leaves, watch how tea is processed or just learn about the process of nurturing the tea crop. Overall, the promotion of rural tourism is not only likely to boost tea sales, but may also promote economic development and relieve poverty. Similarly, it is hoped that the opening of a temple complex in the park will pique interest in Zen tea culture and, again, drive tourist footfall.
According to Ding, the company is looking to sell its Shizu Zen tea for about RMB1,800-2,500 per 500g. Following the official launch of the tea later this year, it is hoped that it will eventually retail for more than RMB5,000 per 500g, in line with increased production quality and its perception as a premium brand.
As well developing tea-related rural tourism, a number of exhibitors had diversified in a number of different directions, with several of them establishing teahouses and tea kiosks in prime city districts. Chensheng Fuyuanchang is now operating a tea kiosk in Zhujiang New Town, the central business district of Guangzhou's Tianhe quarter.
Targetted at the area's high proportion of white-collar workers, the outlet was designed as a place where customers could talk business and see friends in a quiet and relaxing environment. In line with its franchise agreement with Yunnan-based Yiwu Fuyuanchang, it largely serves pu'er tea, with options ranging from the entry level Fucha series, through the more expensive Mingshan, Classic and Legend ranges.
Typically, those visiting the kiosk for the first time opt for the Fucha range. Having been introduced to the true diversity of wider tea culture by the outlet's staff, they then tend to graduate to their pricier options, keen to explore the full range of what is on offer.
Such diversification, however, has not necessarily led to brand dilution. Highlighting the importance of this, Wang said, having originally been a home appliance distributor, Yingjiuhong moved into the tea trading sector five years ago. Focussed on the black-tea market, it has also made a considerable effort to develop its brand. This has seen the company's operating system given a substantial upgrade, while it has continued to refine the quality of its tea.
Young Tea Drinkers
In order to emphasise their heritage, many exhibition stands were, as usual, decorated in a classic style. There were, however, a substantial number of exhibitors who opted for a more contemporary and stylish look, largely in a bid to woo younger consumers.
Bosizhuo, a Guangzhou-based food company, for instance, had adopted an Alice in Wonderland theme for its stand. According to the staff on hand at the show, the company operates the Alice branding under licence from Walt Disney. This has seen it launch Wonderland-themed afternoon teas, complete with New Zealand best butter, exotic Madagascan herbs, Sri Lankan tea and an assortment of biscuits.
Similarly looking to attract young tea tipplers was Yulin Guchafang, a Yunnan-based pu'er tea producer. Its stand, as well as its products, came emblazoned with images of monkeys, elephants, peacocks and parrots, with some of its packaged items resembling exotic lunch boxes. It also offered a range of tea cakes, finely wrapped wrapped and lovingly illustrated. According to the staff on its stand, the company sees young consumers as a growing force in the tea market and one with a huge spending capacity.
As well as its expected showcase for tea and tea-associated products, this year's show also featured a competition intended to find the best-designed tea corner – a dedicated nook where refined individuals can brew the beverage at a time which suits and in a manner of their own choosing. Overall, the promotion of tea corners and fine tea sets was seen as likely to boost the tea market as a whole.
In a final round-up of noteworthy additions to this year's show, Jiangmen-based Laotangba had on offer a fine range of dried tangerine peel pu'er tea, while Wuzhou City's Zhongcha impressed many with its selection of fragrant jasmine-scented teas. Also worth seeking out was Shenzhen's Jingde Tea Industry, with the company promoting its wide variety of simple – yet striking – tea-sets.
The Tea Expo Guangzhou 2017 took place from 25-27 May at the China Import and Export Fair Complex in Guangzhou.
Xing Bin, Special Correspondent, Guangzhou