Lipton hopes to bag China tea market
Lipton out to bag tea market in China
British company Lipton, which made its fortune selling black tea that originated in China, is challenging traditional Chinese habits by launching green and jasmine tea bags on the world's biggest market.
Wang Hui, of Unilever, owner of the Lipton brand, said yesterday that it had started selling the bags in China because it believed more people accepted the modern brewing method.
'Traditionally, Chinese like green tea in the form of leaves and believe that the quality of bags is not good,' she said.
'We feel that with our long history and experience in the industry, our brand is a guarantee of quality.' She declined to give production or sales figures but said Lipton had more than 50 per cent of the domestic market for black tea. It has been selling this form of tea, in bags and bottles ready for drinking, in China since 1992. In 1996, it set up the Guangdong Lipton Tea Leaf Company. While Lipton bought leaves for black tea from around the world, it would buy green tea leaves in China, Ms Wang said.
Most Chinese like to brew green tea slowly with leaves and boiled water. But an increasing number use bags because they are quick, convenient and suit the fast urban life, like instant noodles and coffee and lunch boxes.
'The launch of Lipton's green tea represents a challenge to the China market,' said a spokesman of the China Food Industry Association. 'The advantage of bags is that they cannot become dirty and can be preserved for a long time.
'The packets carry the name of the company and the production date, making it easy for the consumer to complain and reducing the likelihood of loss. When you buy it, you know what you are getting.
'China has famous teas but no famous tea brands. The arrival of Lipton on the market could change all that,' the spokesman said.
'It has a famous brand, with its production and hygiene standards, and could seize a large market share.'
China is the world's biggest producer and consumer of green tea. Annual production is 650,000 tonnes, with the value of the market at about 12 billion yuan (HK$11.3 billion), rising 3 per cent a year. More than half of production is exported.
The Lipton launch is full of historical irony. It owes its fortune in black tea to China. Tea was introduced to Europe in 1650 by a Dutch merchant ship. It became a luxury product for royal families and the nobility of Europe.
Chinese call it red, not black, tea. The Europeans called it black because the East India Company imported leaves directly from the Wuyishan area, near Xiamen, that were dark.
Now Lipton is buying green tea from Chinese growers and selling it to them in bags.
A Fortune 500 company with annual sales of US$46 billion and one of the world's biggest food and drinks firms, Unilever is a major investor on the mainland. It set up its first plant in China in 1923, producing soap in Shanghai.
Since returning in 1986 with a joint venture in Shanghai, it has invested more than US$1 billion in domestic and personal products, food, drinks and ice cream.
