Chai lattes have increasingly entered the mainstream market in Europe, benefiting from the growing popularity of sweet, milky, spiced tea in recent years. Mintel Trend East meets West explains that Asia’s economic growth has resulted in Western businesses and consumers becoming more familiar with Asian products, culture and food. This is particularly evident in the tea segment with the development of chai lattes spiking considerably outside of Asia. In fact, chai latte launches increased by 20% globally in the 12 months to September 2015, driven predominantly by launches in Europe. Germany has been at the heart of the growth of chai lattes in Europe, accounting for roughly a quarter of all products launched in the last four years, making it by far the most innovative market globally. Most brands have sought to target products at younger demographics, which are likely to be more adventurous and experimental. Indeed, a Mintel survey from 2014 shows that almost four out of five German women say they enjoy trying different tea flavours. Moreover, female consumers aged 16 to 24 are more likely to agree that it’s worth paying extra for speciality teas, such as vanilla chai. Emmi’s Chai Latte range is a good example of a chai latte drink that is targeted explicitly at trendy young women. The drink is available in a ready-to-drink (RTD) format and made with Swiss milk, Ceylon black tea, cardamom, cloves, cinnamon, and sugar. Emmi’s Chai Latte was inspired by other RTD launches such as Landessa’s Rooibos Vanilla Chai Latte Drink; Hochwald’s Indian Style Chai Latte; and Münsterland Bombay Cafe Cosmo Chai Latte. Powdered chai tea blends have big potential Even though the RTD format is popular, powdered blends of black tea, milk and spices that require the addition of hot water actually account for the majority of chai latte development in Germany, offering consumers the opportunity to replace café-style drinks at home. The rise of the coffee shop culture has elevated consumer expectations of hot beverages, leading to more chai latte brands incorporating indulgent flavours. In fact, chocolate appeared as a flavour on 7% of global chai latte launches in the 12 months to September 2015, up from just 3% in 2012/13. Recent examples of complex, on-trend flavours and indulgent product formats in Germany include Jacobs Momente’s Chocolate Flavoured Chai Latte Instant Powder; Chai Experts’ Instant Chai Latte Spiced Chocolate Tea; Cosmoveda’s Chocolate Mint Chai Latte Tea Mix; and Krüger’s Coconut & Almond Exotic India Chai Latte Tea Mix. Despite this focus on café-style indulgence, brands should still look to promote chai lattes as a better-for-you alternative to similar coffee-based products. Chai latte products are commonly positioned around ‘skinny’ blends and ‘permissible indulgence’, with many brands promising to be 99% fat free. The sachet format makes instant chai portable and portion-controlled, preventing consumers from over-indulgence. If you would like to learn more about food and drink innovations in Germany, download a free copy of Mintel’s new white paper ‘Germany’s Millennials’, showcasing the three key attitudes German Millennials share in their buying, cooking and eating habits. Jodie Minotto is a Global Food and Drink Analyst at Mintel. She has more than 13 years of experience in sales, marketing and market research roles, predominantly in the food and beverage industry, working for both global CPG companies and SMEs. Her expertise lies in the dairy, confectionery, meal solutions, snack foods, beer and wine categories. You might also be interested in: New Zealand’s most unique food and drink launches of 2016 Cold brew coffee gains traction in South East Asia – but who’s warming up to the iced treat?