---
title: "The 'Commercial War' Turns to Sugar-Free Tea"
description: "A new 'commercial war' is unfolding. Recently, consumers posted photos of Suntory oolong tea priced at 3.8 yuan per bottle on supermarket shelves, sparking speculation of a price war and trending on Weibo. However, Suntory denied any price adjustments. Despite the rumor, sugar-free tea is gaining popularity among young consumers for health reasons, with brands like Suntory and Oriental Leaf expanding their presence."
author: "燃次元工作室"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2023-09-15"
language: "en"
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---

# The 'Commercial War' Turns to Sugar-Free Tea

> A new 'commercial war' is unfolding. Recently, consumers posted photos of Suntory oolong tea priced at 3.8 yuan per bottle on supermarket shelves, sparking speculation of a price war and trending on Weibo. However, Suntory denied any price adjustments. Despite the rumor, sugar-free tea is gaining popularity among young consumers for health reasons, with brands like Suntory and Oriental Leaf expanding their presence.

A new 'commercial war' is unfolding. Recently, some consumers posted photos of Suntory oolong tea priced at 3.8 yuan per bottle on supermarket shelves, comparing it to the usual 5-6 yuan per bottle, and speculated that a 'price war' had begun. This sparked widespread discussion, pushing the hashtag #东方树叶 三得利# to the top of Weibo's hot search. The author also noticed on platforms like Xiaohongshu that many consumers were sharing promotional price comparisons of sugar-free tea drinks from Oriental Leaf and Suntory, speculating that a 'commercial war' had started. However, subsequent media reports cited Suntory customer service responding that Suntory had not participated in any 'price war' nor adjusted product prices. If merchants placed products together, it was their own behavior; oolong tea prices are generally around 5 yuan, and if there are promotions, prices might be around 4 yuan. Although the 'commercial war' was a misunderstanding, it is true that sugar-free tea is gaining increasing attention from consumers. 'I used to keep cola or Sprite at home, but recently I've switched to various sugar-free tea drinks like Suntory oolong tea and Oriental Leaf jasmine tea,' one consumer told the author. 'Mainly for health reasons.' Recently, the author also noticed that in supermarkets, sugar-free tea drinks have changed from their previous 'struggling to survive in the cracks' state, either having their own shelves or being moved to the C-position on shelves.
Image: Sugar-free tea drinks occupy an entire shelf in a supermarket
In several supermarkets and convenience stores in Beijing, sugar-free tea drinks now have their own dedicated shelves, with an increasingly rich variety of brands and categories, including brands like Oriental Leaf, Suntory, Chunchashe, Chali Wang, and Vita, as well as products like Qinggan Puer, Genmaicha, Osmanthus Oolong, Tangerine Peel Oolong, Black Oolong, and Jasmine Oolong.
Starting last year, Suntory oolong tea, which has been in China for 26 years, suddenly became popular due to its use in homemade 'oolong tea + milk + coffee' summer weight-loss drinks. On Xiaohongshu, there are over 10,000 notes related to 'Suntory oolong tea weight loss.' Meanwhile, Oriental Leaf, with its 'national style design' and large areas of white space on the bottle, sparked consumer creativity, and various DIY drinking methods successfully attracted a group of consumers. This year, more and more sugar-free tea brands have joined this summer frenzy, with more notes on sugar-free tea reviews and new drinking methods appearing on social platforms. **Under the hype, the 'money-making' ability of sugar-free tea drinks is also being demonstrated.** According to Nongfu Spring's 2022 performance data, its tea beverage segment revenue grew significantly by 50.8% to 6.9 billion yuan, accounting for 20.8% of total revenue in 2022. Tea beverages have become Nongfu Spring's 'second growth curve.' More and more brands are rushing into sugar-free tea, including classic brands like Suntory and Oriental Leaf, as well as Genki Forest's Ran Tea upgraded to sugar-free tea, Coca-Cola's Chunchashe launch, Uni-President's Chali Wang return, Wahaha's Anhua dark tea launch, and Vita's new sugar-free tea products. Many cross-industry players also want a piece of the pie: tea brand Bama Tea entered the bottled tea beverage track with 'Bama Pure Tea' in two flavors: aged tangerine peel white tea and oolong tea; domestic dairy giant Yili's sub-brand Yike Huoquan also launched sugar-free tea; and new Chinese tea drink leaders Heytea and Nayuki have also rushed their sugar-free bottled teas onto shelves. **Sugar-free tea, once voted by consumers as the 'worst-tasting tea,' probably never imagined it would finally have its moment in the spotlight today.**
Behind this are changes in consumer behavior. However, in the 100-billion-yuan ready-to-drink tea market, sugar-free tea, which has not yet reached 10 billion yuan, is still 'niche.' After a long market cultivation period, young consumers have higher demands for sugar-free drinks. When '0 sugar, 0 fat, 0 calories' becomes basic, making 'better-tasting' sugar-free tea is the key to winning this melee.
**Young People Fall in Love with Sugar-Free Tea** Recently, when shopping at the supermarket, 95-born Tiantian noticed that pure tea bottled drinks, which used to barely fit between sparkling water and juice, now have their own dedicated shelf. 'A whole six-tier shelf filled with various brands of tea drinks. I no longer have to bend down to search on the shelves every time,' Tiantian said. Tiantian has always been a fan of sugar-free tea drinks because she 'doesn't like tasteless plain water, nor does she like sweet drinks,' and sugar-free tea drinks fully meet her needs. But this also made Tiantian an 'odd one out' among her peers. 'My friends of similar age are either milk tea addicts or never without sugar-free sparkling water. Only I hold oolong tea or jasmine tea, and they often mock me as an 'old cadre.' Tiantian smiled helplessly. However, Tiantian recently noticed that more young people around her are drinking pure tea drinks. 'With the defection of milk tea fans and sparkling water enthusiasts, no one calls me an 'old cadre' anymore.' 90-born Wu Yan is one who recently realized the appeal of sugar-free tea drinks. Recently, in the last round of summer welfare benefits distributed by her company, Wu Yan finally 'grabbed' a box of sugar-free tea. Wu Yan told the author that the options included mineral water, sugar-free sparkling water, sugar-free tea, juice, and carbonated drinks, but what she never expected was that sugar-free tea was the most sought-after. 'The first two times I went late to choose, the most left were carbonated drinks, so I had no choice but to take a box of sugar-free sparkling water.'
Image: Topics related to Oriental Leaf and Suntory trend on Weibo
**From 'old cadre' and 'uncool' to 'delicious,' most young people's attitude shift toward sugar-free tea drinks is driven by health considerations.** 'I used to think drinking tea was uncool, but now maybe it's the Chinese DNA in me awakening; I find sugar-free tea drinks not so hard to accept,' Wu Yan said bluntly. In fact, she admitted that her current acceptance of sugar-free tea is the result of years of market education by sugar-free sparkling water. 'The emergence of sugar-free sparkling water made me realize the impact of sugar on the body, but my sweet tooth made it hard to accept sugar-free tea immediately. But now sugar-free drinks are also not safe; the sweetener aspartame may be carcinogenic. Sugar-free tea drinks have clean ingredient lists and have long achieved 0 sugar, 0 fat, 0 calories, and no preservatives,' Wu Yan said. Besides following social media trends to make homemade oolong tea weight-loss drinks, Wu Yan also prefers sugar-free tea drinks as a meal accompaniment. 'Now there are more and more flavors of sugar-free tea, and some brands can eliminate the astringency of tea leaves. It tastes great chilled, especially when eating greasy food; it's healthy and refreshing.' More and more young people are falling in love with sugar-free tea drinks, which also affects market performance. Consistent with Tiantian's discovery, the author recently noticed that **whether in supermarket beverage shelves or convenience stores and newsstands on the street, sugar-free tea is being placed in prominent, easily accessible positions.** Among them, a staff member at a Wumart supermarket in Fengtai District told the author that sales of sugar-free tea drinks have indeed increased compared to the past, and the brands and varieties are also increasing. 'Currently, the best-selling brands are Oriental Leaf and Suntory oolong tea.' The '2023 China Sugar-Free Tea Industry White Paper' released by iyiou.com also shows that over the past five years, sales of sugar-free tea drinks on Tmall and Taobao have grown nearly tenfold.
As a result, sugar-free tea has become a key category for beverage brands. DT Finance's survey on sugar-free tea in May this year also showed that among 41 new tea beverage products in 2023, over 60% were innovations in sugar-free tea, with a total of 18 brands launching 25 new sugar-free tea products and 36 flavors.
**Changes in Consumption Habits** Sugar-free tea is not new. As the earliest sugar-free tea in the domestic market, Suntory sugar-free oolong tea entered the Chinese market as early as 1997; in 2004, Uni-President introduced Chali Wang, a sugar-free tea drink, to the mainland market; in 2011, Nongfu Spring launched Oriental Leaf. But previously, sugar-free tea was not favored by Chinese consumers and was always 'left out in the cold'—Suntory sugar-free oolong tea, a health drink that sold well in Japan, once 'cooled off' in China; Chali Wang had poor sales and eventually withdrew from the mainland market in 2011, eight years after entering; Oriental Leaf was even rated as one of the worst-tasting drinks in the world due to its disastrous taste.
Times have changed, and now sugar-free tea drinks have finally 'propped up.' Oriental Leaf has also endured and become the undisputed leader in the domestic sugar-free beverage market. According to AC Nielsen data, Oriental Leaf has held over 50% market share in sugar-free tea for many consecutive years, becoming the leading brand. **The taste of sugar-free tea hasn't changed; what has changed is consumers' consumption logic.** Food analyst Zhu Danpeng told the author that appearance management, weight management, health management, and nutrition management have run through heavy consumers, and the rise of sugar-free drinks is inevitable, behind which are subversive changes in the consumption thinking and behavior of China's new generation. As Zhu Danpeng said, on the one hand, with the further improvement of consumers' health awareness and the popularity of sugar substitute drinks, the groundwork has been laid for the rise of sugar-free tea drinks; on the other hand, recently, the World Health Organization's cancer research agency classified the low-calorie sweetener aspartame as 'possibly carcinogenic,' which also triggered consumer concerns about the safety of sugar substitutes and accelerated the explosion of sugar-free tea drinks. The author noticed that since 2020, the trend of young people drinking tea has gradually risen. The '2020 Tmall Tea Industry Consumption Trend Report' shows that cold-brewed tea grew nearly ten times faster than the overall tea category in 2020, with most orders coming from post-90s and post-95s. But compared to cold-brewed tea, bottled sugar-free tea is more convenient and better fits young people's consumption habits. 'I have a bunch of tea bags at home, like Chayanyuese and CHALI, all gathering dust,' one consumer told the author bluntly. 'Brewing tea is too troublesome. Hot water brewing requires boiling water and waiting for it to cool. Even cold brewing takes time; for example, Chayanyuese needs to steep for 12 hours. The ideal plan is to steep it the night before and put it in the fridge, ready to drink the next morning, but in reality, I only remember to brew tea when I want to drink it.' Perhaps for this reason, brands are also increasing investment in the bottled tea track. In June 2022, CHALI, which started with bagged tea, also launched a bottled tea product line. **In addition to the shift in consumption logic, the spread of social media has also become key to sugar-free tea breaking out of its niche,** and drinking sugar-free tea has become a healthy and fashionable lifestyle. On Xiaohongshu, Suntory oolong tea and Oriental Leaf have become healthy 'affordable alternatives' to milk tea by adding 'ingredients': Suntory oolong tea with almond powder is 'whitening water,' Suntory oolong tea with kale powder becomes 'weight-loss water,' Oriental Leaf jasmine green tea with raw cocoa powder can make 'anti-binge water,' and Oriental Leaf Puer Qinggan with black coffee and pure milk yields a 'poop milk tea'... Some netizens even established the 'Oriental Leaf National Support Association' on Weibo. In addition, Oriental Leaf's Chinese-style bottle design is also highly praised by young people and sparks creative enthusiasm. On social platforms, fans of Oriental Leaf call themselves 'Shu Men' and willingly become 'organic traffic' for Oriental Leaf. Wu Yan's attitude shift toward sugar-free tea was influenced by social media.
'Since last year, I've often seen content on social platforms about making healthy drinks like milk tea with sugar-free tea drinks. This year, sugar-free tea has become my meal companion and first choice as a water substitute,' Wu Yan told the author. When colleagues order milk tea, the sugar-free tea on her desk also subtly establishes her 'healthy and self-disciplined' persona.
**Sugar-Free Tea Still Niche** In recent years, sugary tea drinks have slowed down, while the sugar-free tea market has shown rapid growth. The '2022 Sugar-Free Tea Beverage Development Insight Analysis' released by Analysys points out that in the past five years, China's tea beverage growth has continued to slow, with a compound annual growth rate of only about 3%; but sugar-free tea beverages have seen rising growth, with a compound annual growth rate of over 20% in the past five years, gradually expanding their share in the overall tea beverage market. Sugar-free tea drinks are taking over from sugary tea drinks as the new growth engine of the tea beverage market, attracting a host of new and old players. In addition to traditional beverage giants like Nongfu Spring and Uni-President, brands like Genki Forest, Vitasoy, Yili, Yinlu, and Wanglaoji are also increasing their efforts. Moreover, new tea brands like Rangcha, Chaxiaokai, and Xurisenlin have emerged, and cross-industry players such as dairy giant Yili, tea brand Bama Tea, and new Chinese tea drink leaders Heytea and Nayuki have entered the fray. **But despite rapid growth, from the perspective of the ready-to-drink tea beverage market, sugar-free tea drinks are still a niche market.** Currently, the market size of sugar-free tea drinks is only about 10 billion yuan. Qianzhan Industry Research Institute predicts that the ready-to-drink tea market will grow at a rate of 4.88%, reaching 143.8 billion yuan by 2027. According to the '2022 China Sugar-Free Tea Drink Industry Insight Report' released by Zero Point Data, it is expected that by 2025, the mainland China sugar-free tea drink market will exceed 10 billion yuan. Sugar-free tea drinks also mainly cover young people in high-tier cities. Li Xinyi, research director at Analysys, told the author that the main consumers of sugar-free food and beverages are still concentrated among young groups in high-tier cities. **With limited scale and many competitors, the 'niche' sugar-free tea drink market has also become 'involutional.'** Li Xinyi pointed out that from a consumption willingness perspective, consumers in low- and mid-tier cities also have some willingness to try sugar-free tea drinks, but the main difficulties in downward penetration are price and taste. As Li Xinyi said, young consumers have higher requirements for the taste of sugar-free tea drinks, preferring products with a clear tea flavor, refreshing taste, and no bitterness. In a survey by iyiou.com on consumer taste requirements for sugar-free tea, 52.2% of consumers said they dislike bitter taste and hope future products can improve this; among users who frequently purchase sugar-free tea in the past six months, 64.4% agreed that 'refreshing taste without bitterness' can better promote continued purchase. Due to factors such as raw materials and production processes, it is difficult to remove the bitter taste from sugar-free tea drinks, so optimizing taste has become one of the brands' focus points. In terms of price, the current price of sugar-free tea drinks is significantly higher than traditional ready-to-drink tea. Although consumers are willing to pay for it now, judging from recent phenomena like 'diao si drinks' winning over young people, young people consider cost-effectiveness when buying ready-to-drink beverages, and low-priced products are more conducive to competing for lower-tier markets. The author observed that Suntory oolong tea series and Oriental Leaf are priced at 5-6 yuan per bottle, while traditional ready-to-drink teas like Kangshifu and Uni-President are mostly priced at 3-3.5 yuan per bottle. Perhaps aware of consumers' demand for cost-effectiveness, this year Oriental Leaf and Suntory have successively launched 900ml and 1.25L large bottles to improve cost-effectiveness.
Li Xinyi told the author that the main consumers of sugar-free tea are mostly post-90s and post-95s. The mainstream price of sugar-free tea drinks is generally higher than sugary tea drinks. As they enter society and become financially independent, they have stronger economic ability and willingness to pay for the pricing of sugar-free tea. **In addition to taste and price, in terms of innovation, sugar-free tea drinks are choosing to compete on raw materials and drinking methods.** From competing on raw materials to drinking methods, in addition to traditional jasmine tea and oolong tea, local famous teas like Anhua dark tea are also being used in sugar-free tea drinks. Additionally, sugar-free herbal tea without tea polyphenols is used to meet the needs of some people with insomnia. In terms of drinking methods, Yili's sub-brand Yike Huoquan recently launched a new 'instant tea' product with a tea-water separation lock-fresh cap, achieving tea-water separation. With a gentle twist and shake of the cap, a bottle of water becomes freshly brewed tea. Sugar-free tea drinks still need to make continuous efforts in manufacturing processes, product promotion, and affordability to move from 'niche' to 'mainstream,' Li Xinyi pointed out. After long-term market education, consumers have higher requirements for sugar-free drinks. '0 sugar, 0 fat, 0 calories' has become standard. How to combine contemporary young people's consumption preferences to develop products that are tastier, more distinctive, and better meet consumers' diverse needs has become a challenge for every sugar-free tea brand.
*Title and some inline images are from VCG.
*Wu Yan and Tiantian in the article are pseudonyms.
*Disclaimer: Under no circumstances does the information or opinions expressed in this article constitute investment advice to anyone.


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