Dive Brief:
- Unilever is launching a single-serve Lipton tea machine, called T.O. by Lipton.
- The device, which will go on sale in France this week, is meant to help boost sales of the brand and challenge its competitor Nestle SA, which has its machine, the Nespresso-like Special.T.
- "(The T.O by Lipton) will cost about 179 euros ($202), 100 euros ($113) more than Nestle's cheapest tea machine in that market," Bloomberg reported.
Dive Insight:
Single-serve devices have become popular as consumers gravitate toward more convenient beverage options. Lipton tea is already affiliated with Keurig, having a line of K-Cups, but now Lipton will have its own machine to promote the brand. Success of this move depends heavily on the number of people willing to pay a steep price for the machine and ditching the tea kettle and tea bag method. Also, cups that are not recyclable have come under fire from consumers and environmentalists.
While the T.O. by Lipton is mainly meant to compete with Nestle's machine, its debut also comes just before the Keurig Kold is set to launch in the next few months. The company has not yet said whether the machine will be sold in the U.S.
On a conference call with investors in July, Unilever CEO Paul Polman said that "the Lipton brand hasn't yet lifted growth to the level Unilever is capable of," Bloomberg reported.