Taiwan Today

For those who want a packaged tea beverage, has a wide selection of choices, including the green tea favored by many health-conscious consumers.

In the Taipei office of Uni-President Enterprises Corp., one of Taiwan's biggest food producers, Selina Wu, head of the company's public affairs division, shows off Uni-President's various packaged tea drinks laid out on a table for display. "Each of them has a distinct image," she says. The lemon tea in brightly colored gable-top cartons is aimed at sporty high-school and college students. The rose tea in bottles with a pink label is for women. And then there is Chai Li Won, meaning "king of the teas." "It targets young office workers fresh from college and you see such people in its TV commercials. It sells quite well," Wu says.

Chai Li Won, a brand of tea drinks that was launched in 2001, is grabbing the largest market share when it comes to readymade green tea and oolong tea. This is especially significant in light of the fact that tea drinks create more revenue than any other kind of packaged beverage in Taiwan and because green tea has been the most popular local tea drink for years.

According to Chen Chung-i, chairman of the Taiwan Beverage Industries Association (BIA), 's beverage sector has seen on average NT$50 billion (US$1.5 billion) in revenue annually for the past 10 years. Around 40 percent of that amount went to tea drinks, although the figure slipped a bit to 38 percent in 2008, mainly because of a slight rise in the sales of packaged fruit and vegetable juices.

Market Infusion

Before 1991, packaged carbonated drinks and fruit and vegetable juices, which made their appear-ances in in the 1920s and the 1960s respectively, were the biggest revenue creators in 's beverage sector. Tea drinks have since caught up, however.

In 2008 Taiwan saw 285 new packaged soft drinks emerging on the market, with 107 falling in the tea drink category, followed by 85 brands of fruit and vegetable juices and 20 new brands of carbonated drinks. Of the tea drinks, 32 were green tea products, 25 fruit tea drinks and 16 oolong tea drinks new to the market.

Green tea now accounts for approximately 35 percent of the total revenue from packaged tea drinks. Interestingly, the first packaged tea drink in was a barley-flavored black tea called Mine Shine launched in 1983 by Uni-President and widely sold in 7-Eleven convenience stores. The now ubiquitous 7-Eleven store chain was opened in by Uni-President in 1979.

Although Mine Shine was the first tea drink on the market, it was the popularity of readymade oolong tea that greatly stimulated the public's interest in packaged tea drinks. Much of the credit belongs to Kaisi Oolong Tea produced by Sinn Si Industrial Co., which made its debut in cans. In the beginning this product did not sell very well, but, around 1990, television commercials featuring a grinning elderly woman from Taiwan's countryside created a strong image for the brand, much like the current marketing effort to create an image for Chai Li Won, and it went on to become a great success.

Kaisi Oolong Tea became one of the most popular packaged tea drinks of all time, and Selina Wu estimates it generated revenue of some NT$6 billion (US$223 million) in its best year. The woman in the commercial was even widely known as the "Old Kaisi Lady" in . Green tea products soon joined the market and in 1993 Uni-President switched from the old-style rectangular cartons to modern gable-top cartons, which have top panels that unfold to form a spout, a world first for green tea drinks according to the company.

"Green tea has been a staple in the packaged tea drinks market since the launch of Chai Li Won and Vitalon Foods Company's Royal Tea Garden Tea in 2001," says Wang Sue-mei, a research fellow from the Food Industry Research and Development Institute (FIRDI), a non-profit organization founded by the government and the Taiwan Canners Association.

Healthy Brew

Meanwhile, in response to the fast changes in consumer tastes for drinks, businesses have been busy diversifying into various tea products. "In comparison with products like instant noodles [another major source of revenue for Uni-President], it's more difficult to command customer loyalty in the beverage sector," says Selina Wu, "and they always want something different when it comes to drinks."

So the 1983 tea Mine Shine, which was marketed as a single product, was later developed into a family of barley-flavored drinks consisting of black tea, milk tea and green tea, for example. When it comes to fruit tea, as well as common flavors such as lemon and plum, producers have also tried a variety of fruits from passion fruit to peach to raspberry. For something different, one might try lavender-flavored milk tea or chrysanthemum-flavored pu-er tea, which is named after in mainland 's province.

One major reason for the popularity of green tea is that more and more evidence indicates that green tea, being unfermented, retains the greatest amount of catechins, antioxidant compounds known for their cancer-fighting properties. In comparison, the semi-fermented oolong tea and fully fermented black tea are not as popular with today's health-conscious Taiwanese consumers.

By the same token, unsweetened tea drinks are gaining popularity in , such as so-called Japanese-style green tea, which is so named mainly because it is sugar-free. According to FIRDI, the sales volume of unsweetened tea in 2006 was one third of all green tea drinks sold and about 50 percent of all oolong tea.

Beverage and food companies have also tried to boost their market share by capitalizing on or enhancing the health aspects of their tea drinks. The unsweetened Japanese-style green tea under the Chai Li Won brand is marketed as having anti-oxidant properties, and in 2005 it became the first packaged tea drink in to win accreditation as a health food from the Cabinet-level Department of Health (DOH). That recognition, represented by an official seal featuring the shape of a person in green, is also enjoyed by one of Vitalon's sugarless green tea drinks. In addition to catechins, a kind of polyphenol, already in the tea leaves, Vitalon adds ingredients that can help to reduce cholesterol and relieve constipation.

However, while there is a trend to embrace tea drinks, exaggerations about their health benefits have been prohibited since the announcement of the Health Food Management Act in 1999. "You're allowed to advertise specific health benefits only if you get a permit from the DOH to do so," Wang Sue-mei says. Two years ago, advertisements for a green tea drink strongly implied it would help the consumer to lose weight, which was not proven scientifically. As a result, the manufacturer was forced to tone down the advertisement after being fined a total of nearly NT$290,000 (US$8,800).

Fresh from the Pot

Research and technology play major roles nowadays in the development of tea beverages as the market becomes more competitive and consumers demand more from tea drinks in terms of both taste and health-improving effects. The most recent figures available from FIRDI indicate that local packaged beverage manufacturers used about 6,500 tons of tea in 2005, with about 14 percent sourced from local growers. Local tea is often mixed with imported tea leaves, mostly from , by local beverage factories.

Nearly all tea beverage manufacturers emphasize that their packaged drinks taste as though they were freshly brewed, and Uni-President's 200-odd-strong research and development division in has developed a unique technique of extraction that breaks the cell walls in the tea leaves, thereby fully releasing the catechins within. In recent years packaged drinks manufacturers, notably Kuang Chuan Dairy Company, have tried a technique for brewing tea leaves at low temperatures to improve the flavor of the final drink and create a competitive edge for their products. Such a method serves to release catechins as well as amino acid molecules that can naturally sweeten the tea juice extract, according to Joy Yu, a Kuang Chuan project supervisor. "At the same time, it reduces the amount of tannin and caffeine from the tea leaves to make the juice taste less bitter," she says.

Originally a dairy products manufacturer formally established in 1974, Kuang Chuan now produces some 10 categories of beverages as well as cold desserts. It launched its first tea drink in 1987 and, seeing the market potential for packaged tea drinks in , decided to launch another brand in 2004 emphasizing the low-temperature brewing method. Kuang Chuan simply calls the product Leng Pao Cha, which means "cold-brewed tea." "Actually this method of brewing tea has been around for some time, but we bottle it," Yu says. Several other brands have since followed suit while Leng Pao Cha keeps performing well on the market, especially since 2006, the year its name recognition received a boost from an endorsement by Taiwanese pop star Chang Hui-mei. Sales increased 10 times between 2006 and 2008, Yu says, and today the revenue from tea drinks is second only to that of the company's milk drinks.

As food companies try to market tea drinks with various flavors and health benefits, the packaging is also changing, with products offered in different containers from paper cartons to PET bottles, which are used for nearly 60 percent of readymade tea drinks. "You can carry the bottle conveniently after opening it and you feel safe if you can easily see what is contained inside," Selina Wu of Uni-President explains.

Apparently the domestic market is already quite competitive, with many contenders competing to satisfy the picky palates of local consumers. Only a small portion--less than 7 percent--of locally made packaged tea drinks is exported, mainly to and several Southeast Asian countries. "Drinks are not suitable for export in the first place. Such products are heavy, but comparatively low-priced and therefore unsuitable for shipment," BIA's Chen Chung-i says.

"The market for packaged tea drinks seems to have become saturated, but beverage companies still see room for development and trip over themselves to launch products," Joy Yu of Kuang Chuan says. "'s population is aging, so the development of tea drinks will certainly be more health-oriented," she adds. Obviously, tea drinks are here to stay and will continue to dominate the beverage market with readymade green tea and sugar-free tea likely to receive a great deal of attention for a long time to come.

Perhaps it is not pure coincidence that two noteworthy events in Taiwan's tea-drinking history both happened in 1983. That year Taiwan's first packaged tea beverage, Uni-President's barley-flavored black tea, hit the market, while in Taichung a teahouse called Chun Shui Tang started business and began impressing customers with its "bubble tea," a drink that was later developed into "pearl bubble tea," one of Taiwan's best-known specialty drinks. Both drinks were made available through channels that were unusual for average consumers of ready-to-enjoy tea drinks, the former mainly through Taiwan's first convenience store chain and the latter in the teahouse founded by Liu Han-chieh. For a long time Taiwanese had bought their chilled, ready-to-drink sweetened black tea from roadside stalls mainly as an everyday drink to quench their thirst, but the new products would change their buying habits and cultivate new tastes for a wider range of tea drinks.

Teahouse founder Liu was originally a public servant, but his tendency to seek change and experiment led him to quit the job to work as a manager in a publishing house specializing in books about food preparation and cooking. "But there wasn't a single book on tea from that company," he says. So Liu spent two years traveling in Taiwan, mainland China and Japan to collect and research tea-related data before publishing a book on Chinese tea-drinking culture. Soon, with a deeper knowledge of tea, he decided to develop his own tea-related business.

Liu benefited a lot from his research, which enabled him to see the huge potential in developing new types of tea drinks. In Osaka, Japan he saw shops making cold coffee with cocktail shakers. Back in Taiwan, he decided to open a teahouse, Chun Shui Tang, in 1983 and try this technique for tea drinks. The result of the experiment, black tea with a fine foam on the top of the drink, was dubbed bubble tea and proved to be a huge success. "The drink tastes much better after you use the shaker," he says, adding that much of the flavor is also due to the syrup of brown sugar added to the drink and made by the teahouse itself. "It takes time to make the syrup, but it tastes better than the fructose used by many beverage shops."

The next year he started to sell chilled oolong tea, which was unique because traditionally people rarely drank this kind of tea cold. Chun Shui Tang, he says proudly, was the first teahouse in Taiwan that served all kinds of iced tea drinks, from black tea, oolong tea, and green tea to pu-er tea.

But Liu wanted to explore more possibilities and encouraged his staff to develop new products. "In the long history of Chinese tea-drinking, so many ingredients have been added to tea drinks, some of them you wouldn't believe. So why can't we be creative today?" he asks. In the mid-1980s, Lin Hsiu-hui, the manager of a Chun Shui Tang teahouse, added her favorite dessert fenyuan, small black balls or "pearls" of tapioca, into some of the tea drinks with milk. The response from customers was surprisingly good and in 1987 Chun Shui Tang formally launched a product it called pearl bubble milk tea.

The teahouse succeeded in attracting customers not only with tea drinks, snacks and meals, but also its relaxed ambience, and has since expanded to 27 teahouses in Taiwan, plus two in Shanghai. As it rose to fame and saw more financial rewards, however, it also faced some difficulties.

A teahouse based in Tainan started to sell tea drinks with white fenyuan made of sago in 1986 and billed itself as the inventor of pearl milk tea. Chun Shui Tang owner Liu Han-chieh published an article denouncing the claim, saying that his teahouse invented the drink, arguing that pearl bubble milk tea is much better known for the pearls of black tapioca made by his store than the white version. The Tainan store responded to the article by suing for libel, and the resulting lawsuit, which ended in 2007, saw Liu win.

With the status of Chun Shui Tang as the inventor of pearl bubble tea decided, Taichung has become the official birthplace of the drink, which can now be found the world over. No one knows what new products Liu will market in the future, but his desire to experiment has already enriched Taiwan's tea-drinking history.

--Oscar Chung

Write to Oscar Chung at oscar@mail.gio.gov.tw