Starbucks has partnered with Anheuser-Busch to produce, bottle, distribute and market the first ready-to-drink (RTD) tea range under the Teavana brand.
The two companies will introduce the new premium Teavana RTD across US channels in the first half of 2017, drawing on flavours from both Starbucks’ and Teavana’s retail portfolios. Within the past year, Starbucks said, its US locations have sold more than $1 billion’s worth of handcrafted Teavana tea beverages, representing 11% growth in year-on-year sales.
The Seattle-based organisation announced the acquisition of Teavana in 2012 for a total price of around $620 million.
Starbucks and Anheuser-Busch said that the partnership would allow them to “bring their complementary strengths to bear to capitalise on the significant growth opportunity” in RTD tea, which experienced compound growth of 16% over the past five years and generates $1.1 billion in sales every year, the two firms claimed. Statistics show that 80% of tea consumed in the US is iced tea, which has a global category value of $125 billion and amounts to 800 million cups per week in the US alone.
Starbucks CEO Howard Schultz (left) and Anhuser-Busch CEO Carlos Brito. © Michael Thomas/Starbucks
Starbucks chairman and chief executive officer Howard Schultz said: “Tea has been an important part of Starbucks heritage since we opened our doors as Starbucks Coffee, Tea and Spices in the Pike Place Market in 1971. When we acquired Teavana in 2012, we saw a unique opportunity to do for tea what Starbucks has done for coffee and expand the Teavana brand across many customer experiences and products. We are excited to work with Anheuser-Busch to unlock the premium ready-to-drink market and further grow demand for the Teavana brand.”
Anheuser-Busch chief executive officer Carlos Brito said: “This arrangement will bring together the strengths of two great companies, each with a long history of successful brand-building. Starbucks’ expertise and leadership in premium tea, combined with our world-class production capabilities and strong US distribution footprint, will position this new product well in what is an exciting and growing category. We are delighted to be in a position to offer this great product to our wholesalers and believe, with their support, we are ideally structured to maximise the sales opportunity for Teavana RTD tea across the US.”
And Philip Mullin, chairman of Anheuser-Busch’s wholesaler advisory panel, added: “Throughout Anheuser-Busch’s history, wholesalers have played a crucial role in the introduction of new products to the market. This arrangement with Starbucks comes at a very exciting time given the considerable growth in the premium RTD tea category, and I expect this news will energise wholesalers throughout our network.”
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