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Starbucks 'reimagines' tea

News, 13 September 2016

HONG KONG: Coffee chain Starbucks is ramping up its tea offering as it seeks to make further inroads into the Asian market and China in particular.

Teavana, a new line of hot and cold tea drinks, has been specifically developed for Asian customers and is now being rolled out across the region, with accompanying marketing support – the first time Starbucks has launched a brand on this scale since 2008.

"Just as we've done for coffee, this is tea reimagined at Starbucks," said John Culver, group president of Starbucks global retail.

That includes innovations such as matcha and espresso fusion, black tea with ruby grapefruit and honey, iced shaken green tea with aloe, and prickly pear and iced shaken hibiscus tea with pomegranate pearls.

Vera Wang, director for product line innovation of Starbucks China and Asia Pacific, described the new beverages as "mixology", a "modern take on Western tea that is departing from the traditional tea experience".

And the drinks are aimed squarely at younger, middle-class consumers. "Definitely, the experience is going to be different in terms of who the customers are," Wang looking for new experiences told Fortune.

"Being an Asian and living in Asia, we understand that Asia is basically a land of tea," she added. "The culture is so entrenched."

The stakes are high for Starbucks as the tea market in China alone is worth some $9.5bn a year – or around ten times the size of the coffee market.

It is aiming to open 500 new stores a year there and to have a total of 3,400 in operation by 2019.

Jodie Minotto, a global food trends analyst at market research firm Mintel Group, noted that the new offerings were "grounded in some safe, familiar ingredients" and added that many of the region's young population don't drink alcohol – factors which will play in Teavana's favour.

Data sourced from Starbucks, Fortune; additional content by Warc staff