468 Retail and Channel Management Blog

Monday, March 13, 2017

For The Love of Tea!

Every time I approach a David’s Tea store, even if I don’t walk in I feel happier. Their bright colours that are all over the place yet organized, their bright lighting, and their upbeat music combine to give customers a highly arousing experience. This in turn is combined with the excitement that comes from the nature of the product, specifically the experience of smelling and then purchasing different teas, whether they’re new to the store and/or teas that were already in the store during customers’ previous visits. The employees also stand in front of the store oftentimes, announcing the transition while offering samples to passerby to go even further to get people to come inside, and some locations have an area with chairs for customers to relax and drink their tea. In other words, the nature of the excitement that comes with trying new teas would have been enough for David’s Tea to be successful, but they compounded this feeling with the excitement their stores create in terms of their appearance, layout, and smells, as well as their knowledgeable and genuinely engaging customer service, to create the ultimate tea experience.
David’s Tea has also integrated tea accessories that present creative ways of enjoying tea at home and on the go, offering flexibility for the standard and unique routines of their customers, which is also reflected in their online option for purchasing their products. They also have teas in strategically selected and attractively packaged gift sets for customers’ to conveniently buy for their fellow tea lovers, and the company’s “Steep Thoughts” blog has articles about how their teas can be used for special occasions, holidays, and in recipes. Thus, not long after David’s Tea opened it’s first store in 2008 on Queen Street has the Canadian retailer seen amazing growth in-store and online from their simple idea of “Great tea, friendly stores and above-and-beyond customer service” to over 200 stores across Canada and the United States, and they plan to share their experience of more than 150 teas with the world.

David’s Tea’s rectangle stores are designed specifically for their target demographic of millennials, who are strategic for them because “they’re a very very similar customer base and they’re reacting the same way to our concept” no matter what city they’re in, according to CEO Sylvain Toutant. Targeting them is also a smart decision because this maximizes the customer lifetime value for David’s Tea while still attracting people of any age who love tea. Their proprietary Frequent Steeper Program also allows them to attain customer loyalty, not only through earning points towards free tea, but through acting on the data this collects about their customers. In particular, the 80% of their customers who are Frequent Steepers directly influence new products that are launched, whether they are new teas or body-care products and scented candles, the latter two of which are currently being tested. This highlights the company’s difference from Starbucks or specialty tea stores: “mak[ing] tea fun and accessible.” All of this makes waiting in line to be engaged by employees while smelling different teas worthwhile, and customers can marvel at the store’s other product offerings in the meantime, potentially creating unplanned purchases.
David’s Tea plans on expanding to 250 stores in Canada and 320 in the US over the next 10 years. Based on their being an example of a successful Canadian retailer that knows how to uniquely tailor the way it communicates to its customers through its stores and online towards its already exciting product, and that they’ve opened over 200 stores in nine years, another 370 in eight years should be a sip of tea.



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