Why is Artisanal and Specialty Tea Lagging Behind Wine, Beer, and Coffee?

Why Hasn’t Tea Had Its Specialty Boom Like Coffee and Craft Beer?

Tea is the second most consumed beverage in the world after water, yet when you look at how specialty coffee and craft beer have taken off, tea seems to be lagging behind. While there are companies marketing high-quality, single-origin, and artisanal teas with a focus on direct trading and ethical and sustainable sourcing, the industry as a whole hasn’t seen the same mainstream shift that coffee and beer have.

So what’s holding tea back? The reasons are deeply tied to history, culture, market dynamics, and consumer perception.

The Coffee Revolution: More Than Just a Caffeine Fix

For much of the 20th century, coffee was primarily seen as a commodity product, mass-produced, and focused on affordability rather than quality. The coffee industry was dominated by instant coffee and cheap diner-style brews. Then, Starbucks changed everything.

Starbucks didn’t just sell coffee; they created an experience. Their cafés became a “third place” between home and work where people could relax, work, or socialize. They introduced specialty drinks, Italian-style espresso culture, and an elevated branding approach that made coffee feel premium.

By the early 2000s, coffee took another leap forward with the Third Wave Coffee Movement. Small roasters like Blue Bottle, Stumptown, and Intelligentsia pushed coffee further into the artisanal space, focusing on single-origin beans, direct trade sourcing, and craft brewing methods. Suddenly, coffee became more than just getting a caffeine fix; it was about flavor, terroir, and transparency in ethical production.

This shift turned coffee from a basic necessity into an experience-driven industry. Consumers became invested in where their beans came from, how they were roasted, and how they were brewed. Home brewing also became a ritual, with pour-over, Chemex, and AeroPress methods making coffee feel like an art form.

The Craft Beer Revolution: From Mass-Produced to Small-Batch Artistry

Beer followed a similar path. For much of the 20th century, giants like Anheuser-Busch, Miller, and Coors dominated the U.S. beer industry, producing light, easy-drinking lagers. Beer was standardized, mass-produced, and predictable.

But things changed in 1978, when homebrewing became legal in the U.S. This allowed beer lovers to experiment beyond what big breweries offered, leading to the rise of small-scale craft breweries. By the 1980s and 1990s, brands like Sierra Nevada and Samuel Adams began challenging the status quo, focusing on bold flavors, unique ingredients, and small-batch production.

By the early 2000s, taprooms and brewpubs became social hubs, turning beer drinking into an experience. Breweries started emphasizing storytelling, local identity, and experimental brewing, creating new styles like hazy IPAs, barrel-aged stouts, and sour beers. Suddenly, beer wasn’t just something you drank but something you explored.

Despite having the same potential as coffee and beer, tea hasn’t seen the same explosive shift toward artisanal and specialty status. Unlike coffee and beer, which successfully reinvented themselves, tea has remained deeply tied to tradition. In many parts of the world, especially in Asia, tea is seen as a heritage product, something sacred that shouldn’t be drastically altered. In China and Japan, for example, tea is an integral part of culture, with centuries-old traditions around its preparation and consumption. While this deep history is valuable, it has also made it difficult for tea to be marketed in a fresh, modern way.

Additionally, one of the biggest reasons specialty coffee and craft beer exploded is because they created spaces where people could engage with the product. Coffee became popular through coffeehouses, and craft beer thrives in taprooms and breweries where people gather. These spaces turned coffee and beer into social experiences rather than just products. Tea, on the other hand, still lacks a strong mainstream tea shop culture. While modern tea bars are starting to pop up, they haven’t reached the level of popularity that cafés and breweries have. Without a place for people to experience and interact with specialty tea directly from its origin, they remain a niche product rather than a cultural movement.

Coffee has an undeniable place in daily life. For millions of people, it’s a non-negotiable part of their morning routine. The caffeine boost makes it essential. Beer, on the other hand, has a social and celebratory function. It’s a drink associated with gatherings, relaxation, and fun. Tea, despite its health benefits and complex flavors, doesn’t fit into routines as seamlessly. It lacks the instant gratification factor that coffee provides in the morning and the social appeal that beer has at night.

While coffee went from instant powder to third-wave artisanal roasts, and beer went from bland lagers to bold craft brews, tea has struggled to change how it’s perceived. For many people, tea still means cheap teabags from the grocery store or overly sweet bottled teas. While high-end, single-origin teas exist, they haven’t been marketed with the same intensity as specialty coffee and craft beer.

One of the reasons specialty coffee took off is because brewing became a hands-on experience. People invested in espresso machines, pour-over setups, and French presses, making coffee preparation feel personal and elevated. Tea brewing, while rich in tradition, hasn’t been widely marketed as an interactive ritual. Outside of traditional tea ceremonies, the process is often seen as passive—just steeping a bag in hot water. There’s potential here. Gongfu-style brewing, matcha preparation, and high-end loose-leaf brewing methods could all be positioned as ritualistic, engaging processes, but they haven’t been fully embraced in mainstream tea culture.

Furthermore, one of the biggest reasons why tea hasn’t followed the same path as coffee and beer is where and how it’s produced. Unlike coffee, which can be roasted locally, or beer, which can be brewed in small batches anywhere, tea production is entirely tied to its origin.

What does the number say? Is tea really lagging behind? 

If we look at market size, specialty growth, and cultural presence, then yes, tea is behind. The global coffee market is valued at around $460 billion, fueled by specialty coffee’s expansion. Craft beer has carved out a 25–30% share of the total beer market in some regions. Meanwhile, the global tea market is valued at $230–$250 billion, but specialty tea makes up a much smaller percentage compared to coffee and beer.

That said, tea isn’t failing; it just hasn’t hit its cultural tipping point yet. If there’s any proof that specialty tea has the potential to go mainstream, it’s Teavana. Founded in 1997, Teavana took the U.S. tea market by storm, introducing consumers to loose leaf tea in a way that felt modern, luxurious, and experiential. Unlike grocery-store tea bags, Teavana stores encouraged customers to smell and sample different teas, creating a sensory-driven shopping experience. In addition to teas, they sold a lifestyle, complete with sleek teapots, fancy infusers, and accessories that made tea drinking feel more intentional and premium.

Teavana’s rapid success caught the attention of Starbucks, which acquired the company for $620 million in 2012, hoping to do for tea what it had done for coffee. This was a huge moment as it signaled that tea could, in fact, follow a similar trajectory to coffee’s shift from commodity to artisanal. Despite its success, Starbucks shut down all Teavana stores by 2018. The rise and fall of Teavana wasn’t a sign that specialty tea couldn’t succeed but proof that there is demand. However, the right approach hasn’t been fully cracked yet. Unlike beer and coffee, which had strong third-place cultures (breweries, cafés), tea lacked a widespread physical community space to anchor its growth.

Where are we headed now? 

Although traditional loose-leaf tea remains a niche market, matcha, chai concentrates, and wellness blends are driving a new wave of excitement and consumer demand.

The Rise of Matcha, Chai, and Wellness Blends

One of the biggest success stories in the tea movement is matcha. This vibrant green powdered tea has surged in popularity, fueled by its Instagram-worthy aesthetics, functional health benefits, and versatility. The color itself plays a huge role in its appeal. In an era where visual presentation is key, matcha’s bright green hue makes it stand out on social media and in cafés. Consumers are drawn to beverages that look as good as they taste, and matcha lattes, matcha-infused desserts, and even matcha cocktails have become staples in trendy coffee shops and wellness cafés.

Beyond its aesthetics, matcha’s functional benefits make it a sought-after alternative to coffee. It provides a more balanced source of energy, thanks to the amino acid L-theanine, which promotes calmness while enhancing focus. Unlike coffee, which can cause energy crashes, matcha offers a slow-release caffeine experience, making it a favorite among health-conscious consumers and productivity seekers. This has been marketed really well in a way that consumers understand. 

The global matcha market was valued at $2.26 billion in 2022 and is projected to grow at a CAGR of 8.9% through 2030, driven by demand in North America, Europe, and Asia-Pacific (Statista). As cafés continue to experiment with matcha in new ways, from iced matcha lattes to matcha-infused energy drinks, its presence in the specialty beverage industry will only strengthen.

Another major force propelling into the mainstream is chai concentrates. Chai has long been an essential part of South Asian culture, where it is traditionally brewed with black tea, milk, and a blend of warming spices like cinnamon, cardamom, ginger, and cloves. Personally, I have been drinking Chai for the longest time. However, the traditional method of making chai from scratch is time-intensive, making it less accessible to busy consumers. Enter chai concentrates, which offer all the complexity of chai flavors without the hassle of preparation.

Major brands like Oregon Chai and Tazo have capitalized on this convenience factor, allowing consumers and cafés to easily create chai lattes by simply mixing the concentrate with milk. This has made chai a staple on coffee shop menus, with Starbucks’ Chai Latte becoming one of its best-selling non-coffee beverages.

Beyond classic chai, variations like Dirty Chai (chai latte with an espresso shot) and seasonal chai blends (Pumpkin Spice Chai, Vanilla Chai) have driven even greater consumer engagement. The chai market is expanding rapidly, with chai concentrate sales growing by 30% between 2020 and 2023, largely due to its crossover appeal to both tea and coffee drinkers.

Additionally, chai fits into the growing wellness and functional beverage space, as its spice blend offers natural health benefits such as anti-inflammatory properties, digestive support, and immune-boosting effects. As more consumers seek out flavorful, lower-caffeine alternatives to coffee, chai continues to carve out a strong presence in both cafés and retail markets.

Another major factor in their growth, although it might seem counterintuitive to my previous point regarding matcha and chai having health benefits, is that matcha lattes and chai lattes typically require the addition of milk and sweeteners. On the other hand, traditional tea, especially high-quality loose-leaf varieties, tends to have more delicate, complex, and sometimes bitter flavor profiles. These additions make matcha and chai lattes more palatable to a wider audience. Sweetness is inherently pleasurable and comforting, which makes matcha and chai easy choices for people seeking indulgent yet slightly “healthier” alternatives to sugary coffee drinks. While traditional loose-leaf tea is often appreciated for its pure and nuanced flavors, it lacks the instant appeal of a creamy, slightly sweet chai latte or matcha drink. This sweetness factor makes these beverages more marketable, especially to younger consumers who grew up on flavored coffee, bubble tea, and energy drinks.

After 2020 and the impact of COVID, consumers have become more health-conscious than ever, leading to a surge in demand for functional beverages that offer more than just great taste. The herbal tea market, which includes wellness-focused blends, is projected to grow at a CAGR of 6.1% through 2028, driven by increasing interest in immunity-boosting, stress-relieving, and gut-health-supporting teas. These blends are increasingly viewed as alternatives to sugary sodas, energy drinks, and even alcohol, further contributing to their mainstream appeal. 

I believe there will always be a niche market for traditional specialty tea, but the biggest growth in the tea industry will come from these three verticals: matcha, chai, and wellness blends. In addition, if we can find a way to ensure ethical and sustainable sourcing, transparency, and direct trading models, it will create a future where consumers connect with tea’s origins while embracing its modern evolution.