This report will analyse and evaluate the drivers behind consumption of tea in Asia Pacific, as well as how leading tea shops are reshaping consumption through premium and affordable strategies. Moreover, we will also evaluate their success and long-term strategic plans to be a global brand, and how incumbent brands can respond and thrive in an increasingly competitive environment.
Delivery
This report comes in PPT.
Key findings
Tea is shifting beyond tradition to become a scalable, lifestyle-driven growth platform
Tea consumption in Asia Pacific is shifting towards a lifestyle‑led growth platform centred on wellness, mood and self- expression. Consumers are driving demand for personalisation, bold flavours and social, shareable experiences. This creates clear opportunities for specialist tea shops and brands to premiumise through innovation, experiential formats and active marketing.
Gen Z’s demand for experimentation and drinking occasions fuel tea consumption
Tea in foodservice demand will be driven by Gen Z’sdine‑out culture, demand for novel and shareable experiences, and social milk tea occasions. This is coupled with large, increasingly affluent Gen Z populations - especially in India and China - supporting long‑term expansion for tea shop brands.
Luxury tea shops face challenges yet important to maintain their core strength to win
Asian luxury tea shops face stiff competition from affordable tea shops alongside high cost of living. As such, it is key for luxury tea shops to focus on their core strengths, alongside active innovation in tea production and visual storytelling such as bold packaging and social media marketing to grab attention and reinforce brand power.
Rise of Chinese tea shops has disrupted the tea shop landscape
While leading Chinese tea brands adopt similar pricing discounts, small outlet space enabling rapid expansion, they differ themselves through signature creations and targeted marketing strategies in China. Furthermore, their expansion into Southeast Asia and US highlights their ambition to be a global brand, where they seek to expand their consumer base.
Creating a unique selling proposition through wellness and experiences is key to succeed in the long haul
Tea shops need to win consumers beyond price positioning and flavours, creating their unique selling proposition by emphasising the value-added functionality and experience as their presence in overseas market matures. Long-term success in achieving profitability includes creating novel functionality in their product, merchandise or even venturing into non-tea categories.
Why read this report?
Key findings
High tea consumption in Asia Pacific reflects its deep integration across daily occasions
Tea consumption has evolved over the years in Asia Pacific, with the rise of tea shops
Rising disposable income levels and young consumer base propel tea growth
Innovation and store experiences serve to popularise chained tea shops in Asia Pacific
Boba tea has undergone various waves of development between 1990 and 2025
Boba tea wave history in Asia Pacific
Relentless product innovation and marketing key to win consumers in boba tea
Tea shops in Asia remain fragmented with different consumer segments
Luxury tea shops face challenges yet important to maintain their core strength to win
Osulloc creates social buzz through its limited-edition Hello Kitty collaboration
Continued evolution of Asian chained tea shops serves to excite consumers
Tealive differentiates itself through local flavours and active product innovation
Rise of Chinese tea shops has intensified the competitive landscape in China
Chinese specialist tea shops expand overseas to boost sales and widen consumer base
Mixue is the leading tea shop brand due to its affordability and massive outlet penetration
Chagee positions itself as a premium tea brand blending culture with modern lifestyle
Learnings from Asian specialist tea shops: Growth opportunities in a competitive market
Is low price business model sustainable for Asian chained specialist tea shops?
US as new market and new strategy for Asian chained specialist tea shops
Yet challenges remain due to operational and long-term appeal to local consumers
Heytea opens its first overseas LAB flagship store in the US
Luxury tea shops: Is their future doomed in a challenging economic environment?
Tsujiri tea house opens new outlet in Paris
Agility and adaptability of business strategy is key to succeed in the long term
Recommendations and opportunities for growth for Asian tea shops
Recommendations and opportunities for growth for international tea shops
Evolution of Asian tea shops and their business strategy
Questions we are asking
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