CHALLENGES
Nestea® was competing for market share with Lipton, the leader in iced tea production. The usual approach of using market trends to develop new products was not generating enough revenue or inspiration to overtake Lipton; they needed a more creative innovation. Because of the Non-Compete Restrictions of Nestea’s® parent company, Beverage Partners Worldwide (BPW), the joint venture between Coca-Cola and Nestle, Nestea® had to innovate while steering clear of the soft drink & hot beverage markets. Rainer Schmidt, the Marketing Director for Tea, approached SIT to find new innovative ways of generating new product ideas.
SIT APPROACH
By using the SIT method, SIT helped their team reevaluate the relationship between beverage consumption and seasonality. Nestea®’s team challenged the expectation that iced tea is only for the summer and launched a line of iced tea for the winter. The team applied their existing strength in flavor innovation to ensure a product that could accompany consumers’ winter drinking habits– a tea that can be consumed at room temperature or heated.
Through this creative innovation, they redefined their target market and subsequently created a whole new “ready-to-drink tea” product line.
RESULTS
- Nestea ® launched 3 new products
- They increased their revenue by 10%
- 100% of their Winter Collection sold out in the first week
Nestea’s “Winter Collection” helped the business carve out a new space in the tea market. Their creative innovation led the new collection to the following successes:
- 2004 limited-edition “Snowy Orange” sold out in Germany in one week
- 2005 limited-edition “Snowy Orange” sold out in Germany & Switzerland
- 2006 “Snowy Orange” released in Europe
- Shortly thereafter, these winter flavors were introduced in microwave-safe bottles across Europe.
