Wednesday, April 04, 2007

Request to Twinings Tea Company: Create more business through the Net.

How to INCREASE your profits and keep old fogeys like me happy...

PLEASE bring back your wonderful variety of leaf tea!


Since the early 1970's I've been discovering and drinking your teas. There are other brands - but I like yours :-)

In 1986 at an IT startup company I helped found we collected & drank over 30 varieties of your teas - as well as our own Espresso machine. Wonderful times!

Around 1988 you changed the formulation of "Earl Grey" and the colour of the packaging. Tasted like Burgamont oil from mint not oranges.

And since you've increasingly focused on what can be easily sold in the high-street and supermarkets. Limited range and culling slow-sellers. Migrating to tea-bags.

All great, not merely good, business sense.

New Business Model

How can you increase your profits and cater to old fogeys like me???

A. The Net - direct sales with minimum qty.
B. Regular "speciality packs" into supermarkets.

Internet sales

  • The people who want to buy your specialist leaf tea are buying a luxury item. A higher price marks extra value. And yes, there would be a price-point sales will decline.
  • you already have many national distributors & can supply locally (by mail) to most of the world.
  • You get to charge double for smaller batches that you make less often.
  • Selling direct means you cut out the distributor/reseller - and double your margin again.
  • And you don't have to do anything much different. Every country now has Internet Sales 'Fulfillment' organisations that charge a modest fee and do everything else...
  • minimum quantity sales [like 1Kg or $25] means your profits don't get sucked away by transaction fees.

In the Supermarkets

  • Look at Aldi and their approach to 'special items'. They make them available for a limited period and then swap out the stock for new specials. You can do a different speciality pack every 3 months for 4 weeks. Savvy buyers will stock up.
  • In Australia, well known brands have occasional 'nostalgia' packaging. Tins printed to celebrate an anniversary usually. They aren't real 'collectables' - but a nice promotional vehicle that in today's recycling conscious world don't get trashed for quite some time. They are a long-term in-home promotional display - that you make an upfront profit on!
    [I have a 250g Earl Grey tin bought around 1990 that sits on my counter top & I see everyday.]

Generation X & Y effects

It's true the Baby Boomers [1946-1964] have a lot stronger connection to Ye Olde Teas - and all the ceremony surrounding them. They also have very high purchasing power now, like what they like (are brand loyal) and are generally comforted by links to their 'roots' - especially pleasant/fond memories.

Their children, Gen X, are surprising - they're turning 40 and have taken on many of their parents preferences and patterns. Why do the Beatles and Rolling Stones still sell so well?? Gen X & Y know and share many of their parents preferences.

And you could be tapping that market as well...

Market Testing

Australia is a great place to test :-) Two large supermarket chains with 60%+ coverage, 80%+ internet access/use [home or office] and a bunch of cashed-up baby boomers - and a reliable & cheap parcel post system.
Won't cost you much to market test and establish the vectors/relationships.

I suspect there is a HUGE pent-up demand for some of your now premium product, from a small but loyal band of 'believers'.
Surveys are unreliable - Dollars at the cashpoint are the only survey that matters.


You can have both the new market of limited choice, fast/easy prep., high turnover + lower margins
Ye Olde World "Slow Food"-style premium-product with high-margins and spectacular range.

The Internet has changed everything. Let it change your business too.

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