Demographic Summary - TeaUSA

1 Demographic Summary The audience for tea is changing as rapidly as the market for tea is expanding. What was once a predominately female, older consumer, has evolved into a much broader target audience depending upon the specific segment and drinking occasion. Historically, the average purchaser of tea bags in the United States was female, 35-55 years of age. The consumers of the beverage she prepared were also a little older than the average dispersion of age within the population. This indicated that younger people were not being introduced to the joys of drinking tea and new consumers were hard to come by.

2 A breakdown of the traditional demographics follows: 2. Demographic Summary By Gender Male Female Male Female 3. Demographic Summary By Age Group Age 60 & over Age 60 & over Age 50-59. Age 50-59 Age 40-49. Age 40-49. Age 30-39 Age 30-39. Age 20-29 Age 20-29. Age 13-19 Age 13-19. Age 6-12. Under 6 Age 6-12. Under 6. 4. Demographic Summary By Location of Consumption Own Home Another Person's Home Away From Home 5. Demographic Summary By Time of Day Morning Lunch Snack Dinner Evening 6. Demographic Summary With the advent of the Ready-To-Drink segment, demographics have changed dramatically.

3 The target audience is young men between the ages of 14-28. Consumers or R-T-D tea are not unlike consumers of soft drinks. They tend to cross gender lines, age groups and approximate as close to an all-family group as is possible. Iced tea mixes also tend to skew much younger than the market for tea bags which bodes well for the future of the industry. Young people are the life blood of the tea industry as they will likely be responsible for a significant expansion of the market as they age and experiment with other forms of tea. 7. Percent of Households Buying By Form Tea Type 1992 1993 1994.

4 Total Tea Tea Bags* Convenient Teas Ready-To-Drink *Includes Specialty/Herbal 8. Household Lifestage Segments Based On HH Composition Vs. Age Of Male/Female Head Vs Age/Presence Of Children Young Singles Middle-aged Singles Older Singles Singles (Includes Widow/ers) Female or Male Female or Male Female or Male 18-34 35-54 55+. Childless Middle-Aged Empty Nesters Younger Couples Childless Couples Couples (Includes Live-In No Children Present No Children Present No Children Present Adult Companions) 2 Adults (>2 Possible) 2 Adults (>2 Possible) 2 Adults (>2 Possible).

5 18-34 / 18-54 34-54 / 35+ 35+/55+. New Families Maturing Families Established Families Families (Defined Based Kid(s). Kid(s) Kid(s). on Kids' Ages) Not All <6. <6 Only >12 Only Nor All >12. 9. Regular Tea Bags Average Price (In Cents) Per 8 Oz. Serving Total Calendar 1994. 10. Regular Tea Bags Buyer and Volume Indices Total Calendar 1994. Young Singles Middle-aged Singles Older Singles % HH's % Lbs % Volume Index 29 44 59. Buyer Index 58 62 77. Childless Younger Middle-Aged Childless Empty Nesters Couples Couples % HH's % Lbs % Volume Index 61 109 124.

6 Buyer Index 93 102 115. New Families Maturing Families Established Families % HH's % Lbs % Volume Index 97 126 149. Buyer Index 97 111 124. 11. # Of Households Purchasing (Millions). All Outlets Total Total # Of Households Million 12. Average Spending On Category Per Category Trip All Outlets Total 13. Average # Of Category Purchases Per Year Among Category Buyers All Outlets Total Carbonated Beverages Milk Juices & Drinks (refrig. & Shelf Stable). Coffee Non-Carbonated Soft Drinks Tea Juices & Drinks (Frozen). Carbonated Milk Juices & Coffee Non- Tea Juices &.

7 Beverages Drinks (refrig. Carbonated Drinks & Shelf Stable) Soft Drinks (Frozen). Change vs + Year Ago 14. Annual Category Spending Per Buyer All Outlets Total 15. Average Shopping Basket Size When Category Is Purchased All Outlets Total $ $ $ $ $ Carbonated $ $ Milk $ $ Juices & Drinks (Refrig. &. $ Shelf Stable). Coffe $ Non-Carbonated Soft Drinks Tea $ Juices & Drinks (Frozen). $ $ Coffe Milk Tea (Refrig. & Shelf Carbonated Juices & Drinks Juices & Drinks Non-Carbonated Soft Drinks (Frozen). Stable). Change vs Year + + + + + Ago 16. Shopping Trips In Alternative Channels And Trip Conversion Total Trips Conversion (% of Shopping Average # of Shopping Trips Trips Among Category Buyers in in Channel Among Category Buyers The Channel that Include the Category).

8 Discount Stores Warehouse Clubs Discount Stores Warehouse Clubs 34. Coffee Tea Coffee Tea Coffee Tea Coffee Tea Point Chg YA: + + + NC + Coffee Tea 17. Average Shopping Basket Size When Category Is Purchased In The Channel Total % Chg vs. % Chg Vs. Discount Stores Year Ago Warehouse Clubs Year Ago $ + $ + Tea Tea Non-Carbonated $ Soft Drinks $ Milk + Coffee $ Non-Carbonated $ Soft Drinks + Juice & Drinks ( ) $ Juice & Drinks $ ( ) + Carbonated $ + Beverages Carbonated $ Beverages Milk $ 18. Buyer Conversion (% Of Category Buyers Who Shop In The Channel And Who Buy The Category In The Channel) Total Point Point Discount Stores Change Warehouse Clubs Change Year Ago Year Ago Tea Bags Tea Bags + Ground Coffee Ground Coffee + + + Herbal Tea NC Herbal Tea + Flavored Soluble Flavored Soluble + Coffee Coffee 19.

9 Average Shopping Basket Size When Category Is Purchased In The Channel Total Point Point Discount Stores Change Warehouse Clubs Change Year Ago Year Ago Tea Bags $ Tea Bags $ Ground Coffee $ Ground Coffee $ + + + Herbal Tea $ + Herbal Tea $ Flavored Soluble Flavored Soluble + $ Coffee Coffee 20. Buyer Conversion (% Of Category Buyers Who Shop In The Channel And Who Buy The Category In The Channel) Total Discount Stores (Mass Merchandisers) Warehouse Club Stores Juice & Non- Juice &. Carbonated Carbonated Drinks Carbonated Coffee Tea Drinks Coffee Milk Tea Beverages Beverages ( ) Soft Drinks ( ).

10 Pt Chg YA: +2 NC +2 +3 +1 +2 NC +2 +3 +1. 21. Specialty Tea Institute Per Capita Global Tea Consumption Patterns Americans consume more than 50 billion servings of tea a year, nearly 85% of which is iced. Over 90% of the tea consumed is Black Tea, about 5% Green Tea, 1%. Oolong Tea and the balance flavored, scented, or mixed teas. About 200 million pounds of tea leaves (bagged & loose) are shipped into the United States each year as well as significant quantities of instant tea. Nearly 80% of Households buy tea and about half the population is consuming tea on a daily basis.