I recently attended an Adobe software conference tied to the theme of experience business or experience economy. The general idea behind that concept is this: As economies evolve people go from demanding basic goods (agrarian- and then industrial-based economies) to demanding services and specific forms of experiences (service- and then experience-based economies). The higher the level of value the more that can be charged; “experiences” can command higher pricing than typical services.
It’s not necessarily simple to tie this back to tea. A bestseller “The Starbucks Experience: 5 Principles for Turning Ordinary Into Extraordinary” outlines how that company built an empire by shifting themes and adding more value.
Of course we’ve now seen that approach not work related to being duplicated for tea sales. This World Tea News article from January 2016 explained how all the Teavana cafes were closing, but the retail stores were doing fine, and then in July of 2017 Starbucks announced they were closing all those shops. I won’t try to interpret that, since related factors were surely complicated, but it probably works to say that sorting out the best approach to selling tea isn’t simple.
Former Teavana cafe
I’m noticing a divide in experiences related to this theme and tea. By far the most popular teas sold in Bangkok are bubble tea or other flavored, sweetened, milk-based take-away versions that might as well have tapioca pearls at the bottom, even when they don’t. It’s a beverage item and that’s it. Tea enthusiasts are at the other end of the spectrum. There can be secondary emphasis on ceremony or collecting gear but it’s mostly about the overall experience.
Of course it’s still about the tea, right? Discussion arises about teaware, preparation methodology, and even subjects like health concerns; in places like online groups or at events, but in the end it comes back to liking aspects of the brewed teas. That’s where the experience is, there is just plenty of room left for framing that.
Related to this split there might be a normal experience or preference curve of sorts, as people shift from floral blends, Tazo tea bags, and matcha lattes onto Gongfu-style brewing something like Dan Cong oolong or aged sheng pu’er. True to the theory, as the demand transitions to a different focus it’s much less about price.
Focus on minimizing level of cost can even invert. Someone recently claimed in an online comment to have only spent under $200 on a sheng pu’er cake once this year, quickly qualified as a smaller 200 gram cake. Bulk order photos are a different form of demonstrating status in consumption level. $200 orders can look impressive, but then a single cake can cost more, and name-dropping decades old version references trumps any quantity. A foreign tea enthusiast recently upped even that ante, describing commitment level as best expressed by a percentage of overall income spent on tea.
Wuyi Origin Mi Lan Xiang Dan Cong; better teas don’t need to cost a significant percentage of your income
It seems all this really isn’t describing a general trend into expanding tea as a service-based experience versus a commodity. The priciest local café here in Bangkok charges over $20 for a pot of tea, for a scant few grams; that’s at least back to purchasing an on-site experience.
How to build that into the next version of a Starbucks, or did that prove to be a flawed goal? Are these people focused as much on experience or on displaying status instead, or can the two really not be split? It’s a bit of a tangent, but I’m reminded of a far more absurd topic coming up in an article about a golden taco:
The world’s most expensive taco is specially prepared at Grand Velas Los Cabos resort… Ordering it will set you back $25,000 — almost the price of a new car.
The taco’s foundation is a gold-infused corn tortilla, which is then layered with Kobe beef and lobster. Toppings include black truffle Brie ($100 per ounce) and a dollop of Beluga caviar ($700 an ounce). Then, more layers of gold are added on top to finish…
Complaining about a $30 pot of tea and people spending enough to buy a car for a taco seem worlds apart.
These diverse threads make it hard to stick to the train of thought of what experiences people might want next related to tea, or what will become popular, and how expenses would factor in. Seeking out traditional, quiet, feng shui designed cafes doesn’t seem likely to catch on. Even the committed tea bloggers I read sometimes speak of setting aside the better teaware and complex brewing processes due to just getting busy, maybe taking up a grandpa-style approach instead.
I drank Tazo ages ago; I have no hate for tea-bag based blends, I just don’t drink that
All the while in beginner-oriented tea groups I keep finding myself arguing the merits of basic, plain, inexpensive loose teas. In one recent discussion, someone asked if mixing peanut butter powder into tea might work (and it might, I guess), and I wondered if that person ever tried a Tie Kuan Yin of any quality level before, or a single example of Chinese black tea. It turned out they were really looking for Thai iced tea (which can be nice).
Plain, simple teas can be amazing experiences, but it’s only easy to package and sell the leaf. It’s not as simple to bring the rest of the experience to everyone.
Photo “…Teavana Tea Bar” is copyright under Creative Commons Attribution 2.0 Generic License to the photographer Brian Chow and is being posted unaltered (source)
Images two and three provided and copyright held by author
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Hi John,
Having had retail stores and developing a brewing technology, my summation from selling tea face to face on a daily basis for years is that people want things that taste good. But they also like things that are ‘hip’ or ‘trendy’ or are branded heavily/well. I just read this article, for example, which shows again the power of marketing tea that changes nothing but the look and the story. https://bit.ly/2KvBS48 However, the biggest beverage marketer in this retail niche couldn’t, or rather maybe didn’t, make stand-alone tea cafe concept work. But it does seem like it is working in India, with millions of investor dollars backing chai concepts or tea concepts of various types. I think it has to do with culture and sometimes culture cross-over as well, like bubble tea and cheese tea. The young age group that has helped these grow into mega-concepts also likes to be ‘trendy’ and fit in. This is a fascinating subject to me but I’ll stop with this so as not to get too wordy.
It is all a lot to get into to pull out a page worth, isn’t it? I read that article on the industry in China. It was interesting if not detailed enough; it wasn’t clear why those new offerings were a disruption beyond just evolving forms a little. I guess any new competition is disruption to established main vendors. I really don’t know how tea offerings and themes will continue to change. What we see in Thailand is a slow evolution to new forms, with nothing changing quickly, including awareness or demand, but it does seem like that could shift at a tipping point. Online economy development lags a little here so a lot of growth potential might be there. With China so nearby it may not need to include more domestic options; the tea could just be shipped over. I’m not clear at all on how a new cafe experience could work out here. Coffee oriented shops could cover demand once it expands.