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    Starbucks Enters $1.2B Packaged Tea Category with Teavana

  • Starbucks is expanding the platform this summer, expanding nationally throughout 2018.

    Starbucks
    When it was announced, Starbucks’ 2012 acquisition of Teavana for $620 million was the largest in company history.

    One of the proposed side effects of Starbucks’ $384 million Tazo sale to Unilever last November was the company’s decision to turn focus to Teavana. Starbucks said at the time that its tea business was growing double-digits globally, and that the company was “well on its way to building the Teavana business to over $3 billion over the next five years.”

    It also launched ready-to-drink premium Teavana Craft Iced Teas through a partnership with Anheuser-Busch InBev and hinted it would enter the packaged tea category in 2018.

    That day has arrived. Starbucks announced Tuesday (June 26) that it is introducing Teavana packaged tea where groceries are sold. The selection of six premium tea sachets are inspired by consumers’ favorite blends and will hit shelves this summer, expanding nationally throughout 2018.

    Starbucks decision to expand Teavana into the $1.2 billion package tea category was inspired by stellar in-store sales, it said. Teavana and Refreshment at U.S. company-operated units grew 14 percent, fiscal 2018 year-to-date.

    “The launch of Teavana packaged tea in grocery is just the beginning of the journey to bring consumers some of their Teavana favorites in a new, accessible format where they purchase their groceries,” said John Culver, group president, International, Channel Development, and Global Coffee & Tea, in a statement.

    “Since our acquisition of Teavana five years ago, we have continued to innovate within the tea category and build distribution outside of Starbucks stores,” Culver added. “We remain committed to executing our plan to increase our tea business to $3 billion over the next five years through Starbucks global retail, packaged tea, and ready-to-drink premium Teavana Craft Iced Teas.”

    When it was announced, Starbucks’ 2012 acquisition of Teavana for $620 million was the largest in company history. Starbucks purchased Tazo for $8.1 million in 1999. It then developed into an iconic brand, especially in the retail sector where it is commonly found on grocery shelves. It’s offered in packaged teas, K-Cup pods, and bottled ready-to-drink teas.

    Teavana, however, didn’t find footing in the retail setting. In July, Starbucks announced it planned to shutter all 379 of its Teavana retail stores around the country.

    READ MORE: Starbucks CEO: Our recent performance is not acceptable.

    For the packaged launch, Starbucks is offering six flavors. They are:

    Youthberry

    A citrus-berry white tea blend with bright pops of tropical flavor. Featuring mango, orange, hibiscus and rose petals.

    Peach Tranquility

    Soft peach shimmers alongside tropical fruit with delicate herbal notes of lemon, verbena, and a chamomile finish.

    Citrus Lavender

    Inspirited by artisanal cocktails, this blend pairs zesty orange and sweet pineapple with lavender blossom and sage notes.

    Jade Citrus Mint

    Lemon citrus notes with green tea and a refreshing spearmint finish.

    Imperial Spiced Chai

    A unique take on a classic. Richly flavored chai tea – traditional chai spices and a Chinese oolong tea base, featuring cinnamon, tropical fruit and citrus notes.

    Earl Grey Créme

    An innovative take on an English classic. Creamy vanilla and soft lavender are added to black tea and top-quality oil of bergamot citrus fruit.

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