Espresso? No Thanks — Tea Is the Next Big Thing for Starbucks


 

Teavana Teas (Photo: Starbucks)

Sorry extra-hot, tall soy cappuccino: You are so last year.

Coffee giant Starbucks launched its first Teavana Fine Teas + Tea Bar earlier this month. The swank store, located on Manhattan’s tony Upper East Side, is the first for Starbucks since it bought the chain in late 2012.
 
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And yes, there will be more. Many more. In an interview with Forbes magazine, Starbucks CEO Howard Schultz said to expect 1,000 more Teavana tea bars around the country in the next five years.

Sure, 1,000 is a big number but make no mistake — Teavana will still be Starbucks’ little brother. As of this year, there were more than 19,000 Starbucks retail stores in over 60 countries.
 
Anyone looking for a cup of java at Teavana will be sorely disappointed: This joint doesn't have an espresso maker. But the company is betting that the tea bar — with its custom drinks, high-end look, and “tea-inspired food,” will bring in tea drinkers who want the 5,000-year-old beverage to be the star attraction.
 
And there are a lot of tea drinkers. The Tea Association of the USA estimates that this country consumed 79 billion servings of tea in 2012. Starbucks believes it to be a $90 billion market globally.

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“As the most-consumed global beverage behind water, tea presents a $90 billion global market opportunity, and we are excited to celebrate the first retail example of how our two companies are coming together,” Schultz said in a statement provided by Starbucks.
 
Having a cup of tea outside of the house is on the rise, too. In the last five years, there has been a 16 percent increase in sales in the United States and that number is expected to rise as interest in “high-end” specialty tea continues to grow, reports the Tea Association.
 
Although the name Starbucks isn't on the front door of this new tea lovers' destination, the company's trademark concoctions are there: The menu boasts such items as a Maharaja Chai Latte, a Coco Caramel Sea Salt Latte, and a Citrus Lavender Sage Ginger Cooler. (According to the Tea Association, 85 percent of the tea consumed in this country is iced.)
 
The new concept is not to be confused with the retail stores of the same name, which mainly sell loose-leaf tea. The Starbucks' tea bars, with low lighting, seating, Wi-Fi, handcrafted tea drinks, and food, will encourage customers to hang out.
 
So, is it possible to become king of both coffee and tea? "It's doable, but it will be a hard slog," Allen Adamson, managing director at brand consulting firm Landor Associates, told USA Today. "But the idea of starting fresh is smart. It's hard to find a quiet place to hang out in a Starbucks. This feels softer and less bustling."
 
The next Teavana Fine Teas + Tea Bar will open in Seattle in November.

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