Competition in UAE’s Tea Market is Heating Up
Competition in the UAE tea market is intensifying as a number of new companies and brands enter the fray.
The newcomers are challenging the dominance of Lipton brand and are following in the footsteps of successful newcomer Alokozay.
Alokozay set out to break Lipton’s near-monopoly by launching special offers and promotions.
“The tea market in the UAE has been dominated by Lipton for several decades and the brand accounts for 80 per cent of local sales,” said an industry source.
“After Alokozay entered the market at least eight new companies and brands, including Good Morning Tea, Golden Tea, Neltea, High Tea, East Tea, Lovely Tea, Tasty Tea and Golden Leaf, have started to offer packets at highly discounted rates.
Most of these companies are selling tea at less than the rate charged by the established manufacturers such as Lipton and Tata Tea.”
Packets of Good Morning Tea, which was launched by MCG General Trading, part of the Carim Group, are available at up to Dh2.5 less than the corresponding Lipton brands and other market players are following the same strategy.
Several trading firms and business groups have diversified into tea as they believe the food industry is immune to the effects of the economic downturn.
As part of their initial offers the new brands are offering consumers gold coins, mobile phones, dhow dinner trips, mugs, T-shirts, air tickets and other gifts.
A source from one of the new companies said: “The annual demand for tea in the UAE is estimated to be above 55,000 tonnes and the market is controlled mainly by Lipton. Our target is to get a market share of at least one per cent within a year. Most of the new players are keen to get a minor market share.
“We are targeting a Dh12 million turnover within two years,” the source said…SOURCE
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