by Lindsey Goodwin

Recent new product introductions in the specialty tea industry reflect a heavier focus on how people are preparing tea than on flavors and blends. New formats introduced lately include so-called “super premium” tea in sachets and wand infusers filled with loose-leaf tea.

The trend suggests tea companies are continuing to cater to consumers with high quality standards, while also tapping into market segments that want convenience. As China Mist Vice President of Sales and Marketing Wade McKasson put it, “Our objective is to be everything tea,” from loose-leaf to (Gasp!) specialty bag-in-the-box.

The pyramid bag makes a comeback

For years, industry observers have predicted the pyramid bag/tea sachet market would plateau, but so far this year several companies have upped their sachet games.

On Jan. 13, 2009, Starbucks introduced 10 full-leaf Tazo tea sachets in the U.S. and Canada. The following week, at the Winter Fancy Food Show in San Francisco, PeLi Teas introduced a line of “Super Premium” whole-leaf teas in biodegradable sachets, and Adagio debuted six organic pyramid-bag teas in re-sealable pouches.

Unlike most teabag lines, PeLi’s selection includes a wealth of unflavored connoisseur teas such as Anxi Ti Quan Yin, Organic Wuyi Mountain Oolong and Special Pu-Er. Lily Chang, co-owner of PeLi, said her company’s classic teas are “targeted at the elite tea connoisseur.” Co-owner Peter Leonard added that sachet blends like Organic Ginger White Tea and Authentic Masala Chai give the line mass appeal.

Whereas Adagio’s line of boxed pyramid bags contained 15 bags per package, the new pouches contain only 10 bags each, a move Charles Cain said was a response to requests from Whole Foods and other grocers to lower the MSRP to below $5 per package. Cain, who heads retail expansion at Adagio, said customers are often “uncomfortable” buying something they haven’t tasted before, especially if it is pricier than other brands on the shelves.

If the line does well, Adagio may phase out its boxed pyramid bags, he said, adding that Adagio’s new retail location likely will carry unflavored, connoisseur pyramid bags in larger package counts.

Defying conventional wisdom, Tea Spree’s gift-packaged pyramid bags boasted impressive sales, according to Managing Director Edward Ostrowski. He said the line’s target market was originally specialty grocers, but it has since broadened to include spas, hotels, resorts, restaurants and even bookstores.

“Pyramid bags may not be for everyone,” he said, but customers are buying Tea Spree’s assorted 10-packs as gifts, and then ordering single-flavor six-packs to restock on favorite flavors.

Although some brands are expanding into pyramid bags to increase market share, others are expanding beyond them for the same reason. Among these are pyramid bag pioneers Tea Forte and two leaves and a bud tea company.

Tea Forte recently launched two lines geared toward opposing market segments. Marketing Manager Jane Whitman said the company’s line of loose-leaf teas in single-serving, pre-portioned foil packets is geared toward customers with increasingly sophisticated tea palates, a need for convenience and lingering anxieties about how to brew the “perfect” cup of tea.

The other line – aimed at broader restaurant, natural, gourmet and specialty markets – consists of flat bags with organic “culinary specialty teas at an accessible price point,” Whitman said. Tea Forte is known for high-end whole-leaf teas, she added, but “there are many times in a day when a more casual cup of tea is called for.”

In 2009, two leaves and a bud introduced gift-ready cylinders of loose-leaf tea containing five of their most popular pyramid bag varieties. Founder Richard Rosenfeld said these were created for the gift market and growing population of connoisseur, loose-tea drinkers. He added that the cylinders have been “a big hit” and he plans to continue to expand two leaves’ product range.

According to Ostrowski, the target consumer for pyramid bags is particular about his tea, but not prepared for the “muss and fuss” of loose leaf. “Americans are still convenience-driven… It is who we are,” Rosenfeld said. However, Ostrowski added, the success of pyramid bags is not strictly an American phenomenon; Tea Spree is currently in negotiations with several international chains.

Reinventing the leaf

Three-dimensional sachets don’t represent the only market shift in how tea is presented to and prepared by consumers. Stash Tea, Rishi Tea, Muzi Tea and others now offer premium, powdered tea leaves, from unflavored white tea (Muzi) to Pomegranate Raspberry Green Tea (Stash).

Dorothy Arnold, vice president of marketing for Stash, said online and catalog sales of powdered teas have increased 50 percent since last year. She said customers have “definitely embraced teas in a powder form” for convenience and health reasons, because they open more opportunities for drinking tea in the office, at the gym and beyond.

Meanwhile, K-Cups (single-serving beverages that brew in Keurig systems) are becoming popular for brewing tea. Twinings, for example, is expanding the availability and package sizes of its K-Cup line to reach broader audiences. Myra Domantay, Twinings’ consumer relations manager, said K-Cups make brewing tea in offices, hospitals and other venues convenient without sacrificing flavor and aroma.

Other innovations in single-serve, convenient teas include Premier’s new line of single-use foil wand infusers filled with whole-leaf teas and Teance’s Freeleaf line of low-waste, hand-tied teas.

It’s in the bag

Once reserved for fast food chains, bag-in-the-box teas are getting a fresh take from at least one specialty tea company. McKasson said China Mist’s line of four bag-in-the-box, pre-brewed iced teas uses new technology and a high proportion of tea solids to create a product designed for restaurants that value the flavor of fresh-brewed and the convenience of bag-in-the-box.

McKasson said the line reduces the waste and labor associated with fresh-brewed tea while increasing speed of service. Convenience is important for foodservice, he added, but it’s an even larger trend in retail.