David’s Tea Goes Public – Tea is so Hot!

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Three years ago my kids (tweens at the time) first introduced me to David’s Tea. I was surprised…and interested. Why would a 9 and 12 year old be talking about tea? Well, if you have ever been into David’s Tea, you probably know why: from the second you walk in, you are welcomed by friendly knowledgeable tea guides, offering you samples of freshly brewed tea. Free tea! In a glass – fancy! Who wouldn’t love that? Lots of us, it seems.

We love David’s Tea for more than the free tea samples. The stores are modern, sleek, and simple, decorated primarily in a beautiful blue David’s Tea color that is a deeper, more turquoise-y, blue than a Tiffany blue. There is no clutter and there are no dark colors to be found. Behind the service counter lies the tea wall: rows of silver tins clearly marked with different tea types and flavors. Out on the floor, there are brightly lit shelves stocked with tea accessories, travel mugs, tea sets, and gift ideas. The stores feel serene and almost spa-like. Only your senses do the work in here as they absorb and get tempted by delicious smells in this 3D experience. I think that’s the idea and I am not alone in loving how David’s Tea is approaching this trend.

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This interest in tea drinking is part of a trend spurred on by consumers’ desires for healthier lifestyles including alternatives to coffee, soda, and other drinks.  Last week on the day of David’s Tea’s IPO, Sylvain Toutant, CEO of David’s Tea, gave two interesting interviews with CBC (The Exchange with Amanda Lang June 5 2015) and Radio-Canada (Click the Audio Fil link on this page) where he described how Millennials are the first generation to talk about tea almost as much as they talk about coffee. The opportunity to play in this market is exciting and Mr. Toutant explained how David’s Tea is separating itself from other tea brands by making tea fun and discoverable – much like how consumers discover wine – with over 150 varieties, scents, and flavors.

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From the interviews, we learned that about 80% of David’s Tea’s sales are consumable tea products that get people coming back into the store or online. The other 20% are tea accessories. In North America, 95% of tea is purchased in grocery stores providing an opportunity for players like David’s Tea to take some of this share while making it fun for all ages to participate in the trend towards health and wellness. Tea is known for its medicinal purposes and health benefits in addition to its lower caffeine compared to other products.

Once you are in the store, though, making a decision on what tea product to buy is easier said than done: the options at David’s Tea seem endless given the simple concept of tea in general.

Most tea comes from an evergreen plant called the Camellia Sinensis that grows in China and India. The different tea types are determined by what part of the country tea leaves are grown and how they are processed. For example, white tea is the least processed, and black tea is fired or roasted. Some teas are blended together. And, teas like herbal ones (also called tisanes or infusions) are made from dried fruits, flowers, herbs, roots or seeds – not from the Camellia Sinensis at all. The combinations of flavors are virtually endless.

David's Tea: The Tea Wall
David’s Tea: The Tea Wall

And these endless combinations are what make David’s Tea so exciting to learn about. Types of tea include White, Black, Green, Oolong, Rooibos, and Organic. Flavors include Currant Affair, Movie Night, Read My Lips, Red Velvet Cake, and Forever Nuts (one of our family’s favorites). Seasonal teas are also cleverly concocted and named, especially when they are called Sleigh Ride (also a fave) and Coconut Ice. You can sip, smell, and even eat some of these (herbal) teas. The tea world now also includes iced teas, lattes, matcha tea (a type of green tea), and other creations. And, you can even join the more than one million “Frequent Steepers” here, earning points for free loose leaf tea.

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By making tea so accessible, interesting, and experiential, David’s Tea is right on trend with providing consumers with healthy and fun options, including blended beverages. What separates David’s Tea from other national coffee shop chains is the dedication to tea, the experience around it, and the endless ways to enjoy tea.  The tea guides are knowledgeable and enthusiastic and they really love telling you about their favorite teas. David’s Tea uses Social Media and their David’s Tea website as a way to spread their brand, ideas and education on tea.  Finally, on a personal note, we find David’s Tea the first place we turn to for teacher, hostess and birthday gifts. Who wouldn’t like a tea mug that changes color or tree ornaments filled with tea or a colorful iced tea bottle-to-go?

Today there are 162 David’s Tea stores with 137 in Canada and 25 in the US. There are plans to operate over 500 stores long term with around 300 in the US.

David’s Tea, a company started in Montreal in 2008 by David Segal and his cousin Herschel (who founded le Chateau), went public on Friday, June 5, 2015. The stock opened at $19, and closed $8 higher at $27. That’s a 42% increase in one day. Based on the closing price, it seems this tea trend is here to stay.

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If you have not experienced David’s Tea stores yet, I hope you will soon.  I look forward to watching and sipping David’s Tea’s growth and creativity…in the mean time, every time I walk in to my daughter’s room, I think of David’s Tea: we loved the corporate color so much that my daughter’s room is painted in David’s Tea blue – we had the color matched at the paint store!

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2 thoughts on “David’s Tea Goes Public – Tea is so Hot!

  1. Excellent and informative info on Davids Tea. The company is definitely here to stay and has taken a chunk out of the food and beverage market.

  2. wow so informative! I love hearing you and your children’s perspectives about this company! this sure is sweet trendy and neat!

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