Bai Tea and Beyond: Analyzing Consumer Choice in the Healthy Beverage Industry

Purpose of Analysis

When your brand lives in a market where differentiation is especially difficult, it’s frustrating in so many ways. At that point, coming out on top boils down to 2 things: individual consumer preference and customer loyalty.

Let’s take the healthy beverage market for example — specifically brands selling a healthy water/tea. Most brands can get their calorie count to near 0 or add in a few health benefits. A slight difference in calories/nutrients between brands won’t matter that much to people. But when it comes to flavor — people will always prefer something different from one another.

If a customer tried your product and liked it, that’s fantastic, but it certainly doesn’t mean you’re safe from churn. There’s a good chance that there’s another brand out there that’s even more catered to that customer’s taste buds with the same number of calories and same “healthy beverage” hook as yours. And it’s only a matter of time before they give that one a try, losing you a potential lifelong customer forever.

So how can you be sure that you’re doing a good enough job at retaining your customers?

How do you know what actually encourages customers to stick around? And whether or not the features you think are competitive advantages are actually advantageous?

We’ll show you exactly how through an example with Bai Tea.

The Analysis

We wanted to compare and contrast a few brands in the market, so we conducted a sentiment analysis on not only just Bai, but also two major competitors, Vitamin Water and Zevia.

For all 3, we took thousands of their public reviews and ran them through Cotera’s Copilot program to identify strengths and weaknesses based on its groupings of positive and negative sentiment.

For Bai Tea, here’s what we found.

You can see that two areas of strength include flavor (which as we mentioned before is subjective), and emotional joy/connection. The latter category refers to how much of a connection customers feel to Bai Tea (ex. how integrated the brand is in their routines, how long of a loyal customer they’ve been, etc.).

We did the same analysis for Vitamin Water, and came up with these results.

It appears that a similar proportion of people who admired the flavor of Vitamin Water also felt that the health benefits and energizing aspect of the drink were nearly equally as enticing. Customer loyalty was clearly very high as well. We can infer from this that Vitamin Water’s health benefits are inherently more interesting/prominent compared to Bai Tea’s.

And finally, we did one more analysis for Zevia.

For Zevia, what’s interesting is that they had the clearest spike in flavor being a key praise. Customers’ emotional connection to the brand is high despite their relatively weaker health benefits. And this was a pattern among each of these 3 brands — the more customers who loved the flavor, the more customers who felt an emotional connection to that brand.

This graph demonstrates this exactly — though Vitamin Water had a higher proportion of customers praising health benefits than Bai Tea or Zevia, Bai and Zevia both still ended up with a higher proportion of customers with an emotional connection to the brand. And we can infer that this can be pretty heavily attributed to the taste.

Meaningfulness of Results

What we can derive from this data is that even if you stack a drink with nutrients and vitamins — people won’t feel any strong, positive emotional connection to your brand unless they resonate with the taste. And it seems like at least out of these 3 brands, Bai Tea’s flavor is the biggest hit.

But the switching cost is low. If we view the category “emotional connection” as a measure of how many customers are likely to stick around long-term, we’d want this number to be as high as possible. The more connected a customer feels to a brand, the less likely they are to try a different (and potentially better-tasting) brand and churn.

So using this data, we created a mini SWOT analysis for Bai.

There are lots of takeaways here — we uncovered some of Bai Tea’s strengths outside of just flavor and health benefits (like versatility in the way the drink can be enjoyed). But we also uncovered weaknesses (like loose packaging or well-loved flavors often being unavailable).

But more importantly, there are a few pretty critical opportunities and threats we’ve identified.

Because beverage taste appears to be such an important component in this market, it’s essential that Bai Tea keeps track of how flavor preferences change over time and rotate inventory accordingly (Cotera can help do this easily).

However, Bai Tea and Vitamin Water did have more sales than Zevia overall (Vitamin Water with the most), implying that their value proposition of a vitamin/nutrient-rich beverage draws in new customers more effectively than a value proposition of solely having fewer calories. Bai Tea just needs to hone in on this value prop to attract more customers and improve the taste/flavor selection to retain them for longer.

Doing so can improve customer loyalty down the line and mitigate a few of the threats we’ve identified — such as customers switching to other drinks and preferring those tastes over Bai’s or potential customers trying a different brand first and pledging their loyalty to them before even trying Bai. These are all major risks that end up costing a LOT down the line.

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