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Chai Trends for 2023

We know it's tea - not coffee - but it's a tasty alternative, in high demand and worth the mention!

When Starbucks introduced chai tea lattes to the menu in the early 1990s, customers couldn’t get enough. Now more than 30 years later, chai lattes continue to be a popular coffee shop menu item across the globe.

“Chai” means tea in Hindi, and is traditionally prepared with milk, black tea, sugar, and a combination of spices—the most common spices include cinnamon, ginger, cardamom, and clove. In the United States, when we order chai tea—which, as you now know, translates to “tea tea”—we are referring to the flavors reminiscent of traditional tea in India.

Consumer demand for tea is increasing, and chai’s flavor profile plays well in signature drinks and baked goods, adding complementary warm flavors to almost any flavor you pair it with. We spoke with coffee shop owners and ingredient distributors about the increasing demand for chai and how they’re using it creatively on their menus.

Customers want more Chai

Tea-based beverages welcome non-coffee drinkers to coffee-dominated spaces with open arms, and research indicates that people are looking to their local cafes for more tea options. By 2025, 83% of spending and 15% of tea drinking in the United States will be attributable to out-of-home consumption—meaning more customers are going out to purchase tea than ever before. As of 2022, at-home tea consumption sales amounted to $2.52 billion, while out-of-home sales reached $10.87 billion. Recent reports also discovered that Millennials and Gen Z are drinking more tea-based beverages—and will continue so through 2023.

After noticing a growing demand for chai tea, Manish Shah, founder of Maya Tea, spent an entire year developing a chai recipe that combines innovation with authentic sweet and spice flavors. Chai can be made using loose-leaf tea, tea bags, or a concentrate, but Shah focused on developing a concentrate, which is popular among coffee and tea shops because it’s easy to use and to guarantee consistency.

“With chai concentrate… it’s a liquid concentrate that you just add milk to. It’s already sweetened, already has the spices, and already has everything in it. You just need to add milk to get the cup that you’re looking for,” says Shah in an episode of his podcast, Steeping Around. “I wanted to create the most authentic representation we could, but still make it easier for cafés to use and lend itself to American palates.”

Shah explains that the availability of chai in most coffee shops has cemented the product in the minds and purchasing habits of Millennials and Gen Z—but now, they’re looking for products with better ingredients. “Their tastes have matured, and their demand for higher quality has pushed chai makers to use higher quality ingredients,” says Shah.

Josh Dann, the Pacific Northwest Sales Director for Pete’s Milk Delivery, a distributor service offering Maya Tea products, notes the significant growth of chai over the last several years. “We’ve had at least four new companies reach out to see if I would consider distributing their chai. Chai is definitely growing in the marketplace.” As the global tea market approaches an expected $266.7 billion in revenue by 2025 and consumer preferences shift toward healthy options, more consumers are opting for tea-based beverages like chai.

Beyond the Chai Latte

With the wealth of warming spices available in a chai concentrate, coffee shop owners and baristas can let their imaginations run wild and create delicious flavor combinations for signature and seasonal beverages.

Beyond signature drinks, chai’s warm and spicy flavors extend to the kitchen. The bakery and kitchen team at Le Buzz Caffe uses chai across the menu, including spiced chai brioche french toast, apple cheese danishes with a chai glaze, chai muffins, chai cookies, and so much more.

Staying Ahead of the Trend

Much like the coffee industry, the tea industry’s consumers are always on the hunt for the next trend. The use of chai continues to evolve to meet demand, and Dann predicts we’ll continue to see new ways to consume chai, “We’re going to start seeing more chai products available in grocery stores, including canned RTD (ready to drink) beverages.”

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