What happened to Teavana, and how will its disappearance be perceived?
Teavana, the loose leaf tea brand purchased by Starbucks in 2012 has closed all of their retail locations as of Spring 2018. Teavana was one of the few chain retail businesses entirely focused on tea, and certainly the largest brick and mortar tea brand in America. What follows is what I view as some of the pros and cons of Teavana's near complete departure from retail. First, what happened?
Why did Starbucks close down all Teavana locations?
Teavana had 379 retail locations, many of which were located in malls. Each of these locations had to be staffed, likely seven days a week. The cost overhead of such an operation had to be tremendous. In Starbuck's own words, the locations were "underperforming". What isn't clear is whether that meant that the retail locations weren't profitable, or if they were simply too low margin for Starbucks to continue operating. Regardless, they made the decision to shutdown the physical retail locations, while retaining the Teavana brand, and refocusing it's offerings to fit better within Starbucks stores and business model.
No more tea presence in malls
I have mixed feelings about this. What was undeniably great for tea drinkers was the presence of a store that was trying to meet their needs in otherwise tea-bleak environment. Typically when out and about, you are restricted to whatever bagged tea may be available from cafes; the quality of which of course can vary greatly. Additionally, I felt that Teavana was very approachable by the average person that didn't yet have an interest in tea. The brand did a fantastic job of marketing the 'idea of tea' to people that had previously shunned the beverage. Where I think there is a benefit to tea culture in general, is in the abolishment of a "strictly retail" tea location. While the focus was definitely on tea, it was more so focused on the idea of selling as much tea as possible. Which brings us to our next item.
No more pushy sales people in the world of tea
The staff at Teavana were often incredibly pushy. You can read review after review of people being forced into conversation. On more than one occasion I had gone into a mall location and been immediately approached with offers to help. I often tried to politely dismiss the staff, informing them I was just browsing. God forbid you pick anything up though, as you would be immediately approached again and asked if you wanted to know anything about whatever item happened to enter your grasp. It's not the staffs fault, as they were clearly trained to behave this way by their corporate overlords, but nonetheless it made for a poor experience. There were a few staff I interacted with over the years that clearly had a love and passion for all things tea, but their genuine interest was often overshadowed by a poor customer service approach. Hopefully these individuals can find better jobs in other areas, or more fulfilling tea related careers.
No more squeezing tea into the coffee box
I believe that one of Teavana's biggest downfalls was being owned by Starbucks. They have a very good format for approaching coffee retail and service, with 57th top brand recognition globally for 2018. Where they succeeded in creating a successful coffee brand clearly didn't fully translate to the world of tea, either by nature of the product itself, or the method in which they approached selling it. The success of starbucks stores is built off of a few key things,
A delicious and consistent product
The coffee that starbucks serves is well liked and pretty delicious as far as coffee goes. In addition to a diverse menu that appeals to a wide audience, they've perfected crafting their beverages in a consistent manner. Your favorite drink will usually taste the same whether you order it in New York or California. With Teavana teas, people found it very difficult to recreate the experiences they sampled while in the store. There were a couple reasons for the variation. The first was the amount of tea used. It was discovered that the tea they use for samples was typically brewed with three times the recommended amount of tea! That means much bolder flavors and deeper color. Furthermore, many of their sample teas were sweetened with additives. For the casual mall-goer that was wowed by a delicious in store sample and inspired to pick up a new tea habit, the attempt at re-creating their mall experience was sure to be a disappointment. If they go home and followed the directions on the side of the tin, and used either no sweetner or even a different kind of additive, the resulting beverage was sure to be a far-cry from expectations. To add insult to injury, if you actually knew to use more tea, the resulting amount of loose leaf tea use was bound to be cost prohibitive.
A relaxing environment that triggers the habit queue of wanting the product
Starbucks built a coffee brand around a real-life coffee drinking experience. They carefully design every Starbucks branded cafe to meet specific guidelines for lighting, music, decor, and more. By doing so, they created a space that people consider idealistic for drinking their coffee. A place where they can envision themselves cuddling up with a book, getting a bunch of work done, or socializing with friends, all while in a hip, urban environment that reflected the kind of person that they want to be! Even if a customer gets their coffee to go, they are still momentarily embodying their personal ideal of the kind of person that drinks coffee and has these transformative personal moments or accomplishments within a coffee shop. Teavana accomplished none of these things. Sure they had beautiful retail displays, but where is the lounge area that encourages someone to take a quiet moment to themselves and enjoy sipping a cup of tea. Where is the emphasis on calm and reflection? Where is the friendly but easy going tea server that is respectful of your visit to their store? Instead of building a unique tea drinking experience that could have reflected elements of the Starbucks brand success, a retail processing center was put in its place.
The convenience of being able to obtain the product with minimal effort
Buying Starbucks coffee, through their app, abundant stores, and drive throughs, make it easier than ever. Coupled with the consistency and the ambiance mentioned above, it's a trifecta that has brought the brand to incredible heights. As if to seal their own coffin, there seemed to be little done to serve similar teas offered in Teavana within the Starbucks chains. There was some overlap, with a few options, but it seemed like an afterthought, and an insincere attempt at integrating tea into a booming coffee business. Teavana enthusiasts for the most part were left to brew their tea at home, never being able to cement their tea-addictions in convenience.
No more massive brand promoting the idea of tea
While I don't agree with approach Starbucks took to promoting tea, this is undeniably still a net loss for tea culture in the United States. A very large brand with all of their available resources at their disposal, put a six year effort into promoting and building a tea brand within America. They undoubtedly brought thousands, and likely millions of people to experience good tea for the first time. The pricing, the branding, and the experience weren't perfect, but my feeling is that it was still a net gain for Tea culture, and that the lasting impact will be mostly positive.
More opportunity for the little guys
Fortunately, there are still several great brands of loose leaf tea that are alive and well, operating within the United States. While many of the popular brands don't have physical locations, they are still delivering a great product through effective ecommerce, which is slowly removing the barrier to tea. As popularity and consumption continues to rise for tea, we will see the birth of more Tea cafes and small locally owned tea retailers, focused on providing great tea and great experiences. Hopefully the growth of interest lines up with our own plans to open a brick and mortar aquarium tea lounge in the next decade or so.
Overall, I think Teavana closing down will prove to be a good thing for tea culture. While the immediate effect is bound to be a slowed interest in tea consumption, the rise in interest is bound to have a net positive effect in the long run, and Teavana's demise has made way for the success of more authentic, smaller, and local tea experiences. Much like wine, the variety of tea is what makes it shine. By distributing the selection and offerings across a greater number of vendors, tea options are inherently increased. Teavana still remains alive and well as a Starbucks and ecommerce brand, but with significantly reduced options, and a further focus on mass market commercialization.
Hopefully we see the public maintain a continued interest and form a deeper relationship with tea in the coming years.