Gong cha counts on decadent drinks to capture Middle East market
The bubble tea trend is growing in the region, where the climate keeps it popular year-round.
London-based Gong cha is betting on its signature Milk Foam Slush Series of indulgent drinks to win in the Middle East, whose desert climate is expected to drive a year-round demand for cold bubble tea.
“You don’t find in the Middle East the four seasons you find in the rest of the world,” Keaton Myburgh, Franchise Business Leader for the Middle East at Gong cha, told QSR Media. “So an iced drink like bubble tea can be enjoyed all year round.”
Competition in the bubble tea market in the Middle East is slowly increasing as players like CoCo and Tealive announced their expansion plans in the region following Gong cha’s launch in Riyadh in July.
Founded in Taiwan in 2006 and headquartered in the UK, Gong cha operates in 28 markets around the world.
Myburgh said consumers in the Middle East enjoy occasions outside of the home and have the spending power to do so more often.
The global bubble tea market size was valued at $2.46b in 2023 and is projected to grow 7.7% annually to $4.78b by 2032, according to Fortune Business Insights. The Asia-Pacific region dominated the market with a share of 42.68% in 2023.
Apart from the US and Asian countries, the milk tea trend is also extensively growing amongst people in the Middle East and Africa, the report added.
Myburgh noted that during their market testing phase, they found that consumers in the Middle East leaned more toward the decadent and indulgent range of drinks, such as brown sugar flavours and other signature drinks.
“This is very different from some of our other markets where there is a greater focus on our fruit teas and fruit category,” he said. “We ensured that we launched a menu in the Middle East that was well suited for the market.”
‘From tea garden to cup’
In January, Gong cha signed its largest master franchise agreement with restaurant operator Shahia Foods Group to open hundreds of stores in the Middle East. It is planning to open more outlets in Bahrain and the United Arab Emirates in 2025, which is part of a longer-term agreement to open at least 300 Gong cha outlets across the region.
At their initial launch in July, Myburgh said they faced the challenge of brand and product recognition. They had to make consumers aware of who Gong cha was and where they were from. Gong cha was also tasked with introducing their product to Middle Eastern consumers who habitually preferred coffee.
“We've done a lot of work discussing our heritage, our legacy, where we are, and where we come from,” Burgh said. “Additionally, we made it easier for guests to try our products by doing a lot of sampling in-store. This gave them the opportunity to try our product before buying a drink.”
“Basically, we wanted them to understand the product from tea garden to cup, and ultimately find their favourite flavour when they come back,” he added.
This means the teams in the stores talk to guests about their menu and inform them about the different types of drinks and ingredients available. Myburgh said this circles back to accessibility, which is tied to opening more Gong cha outlets. They have four outlets under construction.
“We want to make sure that when customers want our product, they don’t have to drive too far to get it,” he said.
“The overarching master franchise agreement we have with Shahia Foods Group is to open 300 outlets within 10 years across the Middle East. The two markets we are focusing on next year are the UAE and Bahrain. We are ready and excited to serve our freshly brewed whole leaf tea to as many customers as possible across the region, developing new habits for our guests and creating a daily tea ritual.” he added.
