Total Tea Sales Were Relatively Stable · 1% 4% 5% 6% 5% 1% 1% 3% 5% Price Per Pound % Chg vs Year...
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Transcript of Total Tea Sales Were Relatively Stable · 1% 4% 5% 6% 5% 1% 1% 3% 5% Price Per Pound % Chg vs Year...
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Total Tea Sales Were Relatively StableConsumer Sales of Total Tea
Total Grocery-Mass-Drug (Millions)
129 131 130
0
20
40
60
80
100
120
140
1998 1999 2000
$1,538$1,639
$1,715
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
1998 1999 2000
% Chg -1%2% 5%7%
Pounds Dollars
% Chg
Total U.S. -*52 Weeks Ending 7/22/00
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The Pounds Sale Decline Was Driven ByLess Tea Purchasing Per Shopping Trip
Household Purchase Dynamics of Total TeaAll Outlets
-1.3%Buying Rate (Annual Spending per Household)
+2.2%Penetration (Millions Households Purchasing)
+0.7%Average Total Shopping Basket when Tea Is Purchased
+1.6%Average Purchasing Trips per Year
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Grocery Remains The Dominant Tea ChannelConsumer Sales Of Total Tea
(Millions)
Mass12%
Drug2%
Grocery
86%
Mass9%
Drug4%
Grocery
87%
Pounds Dollars
Note: Mass Merch includes SuperCentersTotal U.S. -*52 Weeks Ending 7/22/00
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Grocery Dollar Sales Are Gaining Due To HigherPrices And The Increasing Importance Of R-T-D
Consumer Sales Of Total Tea Dollars Grocery $2MM+ (Millions)
Total U.S. - *52 Weeks Ending 7/24/99 or 7/22/00
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However, Grocery Tea Dollars AreContinuing Recent Declines
Consumer Sales Of Total Tea Pounds Grocery $2MM+ (Millions)
Total U.S. - *52 Weeks Ending 7/24/99 and 7/22/00
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The Growth Of Mass And DrugHave Offset Grocery
Consumer Sales Of Total TeaTotal Grocery-Mass-Drug (Millions)
-0.7%
-4.1%
28.8%
12.5%
4.6%2.3%
31.7%
6.6%
Pounds Dollars
DrugMassGroceryTotal – All Outlets
$72$157$1,486$1,715 315112130
Total U.S. -*52 Weeks Ending 7/22/00
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All Kinds Of Tea
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Ready-To-Drink Contributes Significantly To Dollars,But Is A Great Deal Less Important To Pound Sales
Share Of Tea Sales By TypeDollars Versus Pounds – Total Grocery-Mass-Drug
Herbal
5% Instant6%
Iced Tea
Mix22%
Green
Tea3%
Pounds Dollars
Herbal10%
Instant
2% Iced Tea
Mix16%
GreenTea
5%
Total U.S. -*52 Weeks Ending 7/22/00** Three Outlets = Grocery $2MM+, Drug, Mass Merch
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Tea Bags/Green Tea Has Stabilized, WhileRTD Continues To Impact Iced And Instant
Share Of Tea Pound Sales By Type — Grocery $2MM+
60.9 60.4 60.8 59.2 58.1 57.5 57.2 57.1 56.1 55.6 56.0
20.4 21.7 22.3 23.5 23.8 24.2 24.3 24 24.7 24.3 23.4
0.7 1.0 1.3 2.9 4.6 5.0 5.7 6.6 7.5 8.6 9.3
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999* 2000*
Loose Tea Tea Bags (includes Green Tea) Herbal Instant Iced Tea R-T-D
Note: Tea Bags include Green Tea (4.9 share in 2000*)Total U.S. - *52 Weeks Ending 7/24/99 or 7/22/00
Instant
Loose Tea
Tea Bags(includes
Green Tea)
Herbal
Iced Tea
R-T-D
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Volume Expansion Was Fueled By Green Tea Gains,While Dollar Growth Was Powered By Ready-To-Drink
Tea Sales Growth 1999-2000 By TypeTotal Grocery-Mass-Drug (‘000)
(45)
1,210
(82)
635
(441)
(1,557)
(634)
(958)
Loose Tea
Green Tea
Herbal Tea
Ready-To-Drink Tea
Instant Tea
Iced Tea Mix
Regular Tea Bags
Total Tea
($337)
$27,689
$5,402
$49,478
($1,929)
($13,013)
$10,008
$76,062
Pounds Dollars
Total U.S. -*52 Weeks Ending 7/22/00
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Both Buying Households And Increased TeaPurchasing Drove Green And R-T-D Gains
% Change in Penetration — All Outlets
-6.5%
-1.9%
44.6%
3.9%
-3.7%
11.4%
2.9%
-0.5%
Penetration
Buying Rate
RTD TeaGreen TeaHerbal TeaIced Tea Mix
Total U.S. -*52 Weeks Ending June 2000
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Dollar Sales Growth Was Fueled ByIncreased Pricing Across All Tea Types …
Tea Price Per Pound ChangesTotal Grocery-Mass-Drug
1%
4%
5%
6%
5%
1% 1%
3%
5%
Price Per Pound % Chg vs Year Ago
GreenTea
LooseTea
HerbalTea
RTD TeaInstant
TeaIced
Tea MixDecaf
Tea BagsRegular
Tea BagsTotal Tea
Total U.S. -*52 Weeks Ending 7/22/00
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Green & Herbal Achieve Significantly HigherPremium Pricing To Mainstream Tea
Tea Dollar Sales by Price PointTotal Grocery-Mass-Drug
$5.08
$7.74
$8.31
$9.47
$11.24 $21.15
$25.96
$0
$50
$100
$150
$200
$250
$300
$350
$400
Opportunity?
$
Price per Pound
Do
llars
(M
illio
ns)
InstantTea
RegularTea Bags
IcedTea
DecafTea Bags
LooseTea
Green
Herbal
Total U.S. -*52 Weeks Ending 7/22/00
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Ready-To-Drink Is Especially Important In Drug,However Tea Bags Dominate Across All Outlets
Division of Tea Pound Sales within Channels By Type – Grocery $2MM+
Herbal4%
R-T-D7%
Regular Tea Bags
65%
Instant Tea8%
Iced Tea Mix13% Green
Tea2%
Herbal5%
R-T-D9%
Regular Tea Bags
54%
Instant Tea6%
Iced Tea Mix22%
Green Tea3%
R-T-D27%
Herbal8%
Regular Tea Bags
56%
Iced Tea Mix6%
Green Tea3%
MassMerchant
Grocery$2MM+
DrugStores
Total U.S. -*52 Weeks Ending 7/22/00
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Grocery Is Still The Key OutletFor Regular Tea Bag Sales
Consumer Sales Of Regular Tea Bags
Mass14%
Drug2%
Grocery
84%
Mass11%
Drug2%
Grocery
87%
Pounds Dollars
Total U.S. -*52 Weeks Ending 7/22/00
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Regular Tea Bag Volumes Declined Slightly,But Dollars Sales Gained
Consumer Sales Of Regular Tea Bags(Millions)
-0.9%-4.7%
23.9%
55.3%
2.1%
-1.0%
28.7%
24.0%
Pounds
Dollars
DrugMassGroceryTotal – All Outlets
$9$57$431$497 2106271
Total U.S. -*52 Weeks Ending 7/22/00
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RTD Tea Continues Strong Dollar Growth,Capturing 37% Of Tea Grocery Dollars
Ready-To-Drink Tea — Grocery $2MM+$5
8.9
$84.
8
$237
.3
$370
.0
$383
.0
$400
.0
$417
.0
$460
.0 $514
.0
$549
.0
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91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
*
20
00
*
6.0% 8.
1%
20.1
%
28.4
%
29.0
%
30.3
%
31.5
%
33.0
% 35.4
%
37.0
%
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
*
20
00
*
Dollar Sales (Millions) Dollar Share of Tea
Total U.S. -*52 Weeks Ending 7/24/99 or 7/22/00
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Ready-To-Drink Provided The Sole Tea GainsWithin The Supermarket ($2MM+) Channel
Volume Gains 1999-2000 — Tea Pounds (000s)
429960
(76)(2,172)
(597)(295)
(2,931)
185200
31669
158247
1,969
2180
(54)
(2)(34)
328
0
(4000) (3000) (2000) (1000) 0 1000 2000 3000
Regular Tea Bags
Herbal TeaInstant Tea
Iced Tea Mix
Loose TeaGreen Tea
Ready-To-Drink Tea
Regular Tea BagsHerbal Tea
Instant Tea
Iced Tea MixLoose Tea
Green Tea
Ready-To-Drink Tea
Regular Tea BagsHerbal Tea
Instant Tea
Iced Tea MixLoose Tea
Green Tea
Ready-To-Drink Tea
Drug Stores
Mass Merchandisers
Grocery $2MM+
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Finally, There Are Distinct Differences In TheDemographics For The Growth Segments
Demographic Insights
• Tea Bags• Large Families, Older Children, South, Rural, Less Affluent
• Green Tea• Small Households, No Kids, 55+, East/West, Urban
• Ready-To-Drink• Large Families, Middle-Aged (35-54), East, Urban
• Kids 6-17 Ethnic Households, Affluent
– Demographic profiles are largely unchanged since 1996
Total U.S. -*52 Weeks Ending June 2000
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A Closer Look At Decaffeinated Tea
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Decaf Tea Growth Is Outpacing Regular,Accounting About 13% Of Sales
Total Grocery-Mass-Drug
Pounds (000)
$ (000,000)
113
17
1,504
211
-1%
+4%
+4%
+9%
Regular
Decaf
Total U.S. -*52 Weeks Ending 7/22/00
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In Fact, Decaf Tea Bag Sales Helped OffsetRegular (Caffeinated) Tea Bag Losses
Tea Bags Gains By CaffeinationTotal Grocery-Mass-Drug (‘000s)
+9.4%-0.8%+4.4%-2.0%
DecafRegularDecafRegular
Dollars
(1,190)
800
($2,695)
$12,703
Pounds
Total U.S. -*52 Weeks Ending 7/22/00
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Decaf’s Presence Is Strongest In Tea BagsVolume Share Of Decaf Tea By Type
Total Grocery-Mass-Drug
Instant Tea11%
RegularTea Bags
77%
Iced Tea Mix8%
R-T-D4%
Note: Dollar Mix is similar to Volume MixTotal U.S. -*52 Weeks Ending 7/24/99 and 7/22/00** Three Outlets = Grocery $2MM+, Drug, Mass Merch
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Decaffeinated Growth Was Sourced AlmostEntirely From Tea Bags And Ready-To-Drink
Decaffeinated Tea Sales Growth 1999-2000 By TypeTotal Grocery-Mass-Drug (‘000s)
103
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(69)
556
0Loose Tea
Green Tea
Herbal Tea
Ready-To-Drink Tea
Instant Tea
Iced Tea Mix
Regular Tea Bags
($2)
$5,600
($23)
($635)
$12,703
Pounds Dollars
Total U.S. -*52 Weeks Ending 7/22/00
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Don’t Miss The Opportunity
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Bottled Water Market Has Grown10 Fold Since 1976
U.S. Bottled Water Market1976-1997, Gallonage
0
500
1000
1500
2000
2500
3000
3500
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
Th
ou
san
ds
of
Gal
lon
s
YearSource: Beverage Marketing Corporation, New York
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Water Is A $2.6 Billion Dollar Market,Growing Over 20%
U.S. Bottled Water Market — 1976-1997, Gallonage$2.60
$2.20
$1.90$1.70
$1.50
1995 1996 1997 1998 1999
21%17%12%13%% Chg
* Food, Drug, Mass, Convenience, Petro
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We Must Continue To Find New Ways ToLeverage The Benefits Of Tea
• Tea Based Beverages• i.e. Minute Maid and Snapple Iced Tea, Lemonade/Lemonade Iced Tea
• Tea Based Frozen Specialties• i.e. Tea Flavored Ice Pops (recruit young consumers early)
• Dietary Supplements• i.e. Anti-Oxidant Tea Pills
• Tea Based __________________
–
