High-end tea retail sales slump as market tastes change

Deng Zengyong, manager of Sunriver Tea, an Anhui-based tea company that focuses on black tea in Anhui province and Pu'er tea produced by Yunnan province, said the new market for tea places higher demands on the production, management and marketing of a tea company.

To excel against competition, it was essential for a tea company to provide highly cost-effective products and services, he said. A tea company would only be able to set consumer-friendly prices through the strength of its products, along with large scale production and high yields.

Meanwhile, online shopping for mid-range tea emerged as a new platform for tea consumption, buoyed by the burgeoning of e-commerce.

November was often considered a low season for shopping, but with the advent of arguably the country's biggest shopping day of the year, "Single's Day" on Nov 11, tea products saw their sales on Alibaba's Tmall website reach 4,854,822 items, surging 54.6 percent compared to last year.

More than half of consumers bought mid-range tea products.

"There are more and more young people paying attention to lifestyle and the quality of life, and young people prefer online shopping. Tea companies are developing their online sales approach as the major tea consumer group is becoming gradually younger," Wu said.

Sunriver Tea introduced a great many of its tea products on e-commerce website Tmall.com, in addition to its traditional retail sales.

"The tea products online carry the same price tags as at retail stores across the country. We rarely have sales promotions, the online sales tend to help with visualization and branding," said Liu Shan, business specialist of the marketing department at Sunriver Tea.