Recently I read an article in Small Biz Trends titled 18 Tea Franchises to Challenge Teavana. They could have added ‘to challenge David’s Tea or Argo Tea’ as well, I suppose. But, in looking at the companies mentioned, I saw lots of boba/tapioca tea places and some with spices as the main or lead concept. I could be wrong, but most boba tea stores make their drinks from powdered mixes, don’t they? When I think of tea, I think of loose leaf.
That article got me to thinking about why we really haven’t seen super-success in any loose tea retail concept here in the U.S. It reminded me of another article, a pictorial I had seen recently called Tea Traditions Around the World. Maybe this explains why boba seems to be the dominant/winning concept in U.S. cities with high Asian youth demographics. Boba explains why even Starbucks couldn’t make an upscale tea cafe concept happen here, and so is moving their major retail tea efforts now to countries like China.
We actually do have a strong tea culture in the United States, however, and, statistically, that culture is drinking iced, black tea either ordered with our meal in a restaurant, or made at home from bags or powdered instant tea. That’s over 80% of the tea consumed here. That is our tea culture and it’s been the culture here for as long as any of us alive today can remember. It hasn’t been great loose tea in all its stages of oxidation, brewed perfectly and served well. The only concept here, until the recent modern tea cafes, that even resembled another ‘tea culture’ was the red hat ladies, where the quality of the tea didn’t really matter; it was pots, tea bags, funny hats and a little day-time party-time.
One thing I respect about Starbucks is that they can admit when something isn’t working. And to them, that’s when a concept doesn’t make them as much money per square foot as the space could be worth if they put one of their coffee houses in it. I think it’s harder for the independent retailer to just admit when something doesn’t work like they were hoping it would. Even David’s Tea has run into a problem in the U.S. for their “on call” hiring and, as labor continues to become more expensive, and as space rents continue at their outrageous monthly fees or even possibly escalate, all of us who have ‘tea retail dreams’ have to get real and look at the numbers. Can tea carry its weight as a stand-alone concept? Notice how some of the other franchise concepts in the article use something else as the major draw, be it coffee or spices, along with the tea.
If we look at those tea traditions around the world, many other countries already have cultures in place that can support tea cafe concepts much more readily than the U.S., including Britain, Canada, Asian countries and the Middle East. The United States is a convenience-oriented, instant society. However, the foodie culture has come on strong, putting flavor and artisinal values over convenience. How will this impact tea–or will it at all? It may, as we are seeing chefs all over the country promoting tea-infused recipes and menu items. Tea-infused cocktails and tea mocktails are all over social media. Loose/quality tea definitely is getting some awesome press and attention.
Then there’s the ‘elephant in the room’ we might want to ignore, but can’t: the big taste (and caffeine) difference between tea and coffee. As a U.S. coffee-oriented culture, coffee doesn’t mean black, unsweetened coffee. It means sugar, cream and, perhaps even more importantly, espresso drinks with syrups, sauces, and whipped cream. We did specialty tea drinks that people loved, but it’s a whole new idea. Coffee culture is an addictive/addicted culture, and that means plenty of repeat business (and profit) by necessity for people to need that caffeine fix, to avoid jitters, headaches, grouchiness, or just to be able to function and keep going through the workday. One huge coffee chain was accused of hyper-caffeinating their coffee. Whether or not that was true, the fact is it is much more physically addictive than tea, and the taste is “richer/deeper/stronger” in general. Tea is a more delicate, refined taste profile that, once you come to appreciate it, makes coffee seem ‘coarse’. It’s also much healthier than coffee. I’ve read the articles on health, like most of us here have, and aside from those articles showing all the health benefits, I think most of us just feel physically better after drinking tea–as opposed to feeling pretty darn crappy after too much coffee.
So, those are my thoughts on the subject. What are yours? We are working on our own updated tea-centric retail concept, but we need more statistics and information before once again putting in the money required for launch. In the meantime, it is fascinating to watch as the big race is on to hit the ‘right formula’ for a U.S. tea concept that mainstream/mass consumers will really go for in a big way. If quality and presentation, or even marketing, was all it was about, there would not be a problem. But that’s not what it’s all about. Starbucks did us all a huge, expensive favor by trying out the retail tea cafe concept themselves, with all their money, marketing and muscle, and letting us know that the U.S. is still not ready to accept it as an equal to coffee houses.