The deal, which echoes the arrangement with PepsiCo that put Starbucks' Frappuccino on grab-and-go retail shelves, will likely deliver more of a marketing boost than a direct sales pop to Starbucks units. However, Starbucks noted that it is already brewing and selling $1 billion worth of Teavana tea in its coffee outlets on an annual rate, with sales increasing year over year at an 11% clip.
The cafes sell bottled Frappuccinos under the deal with PepsiCo and will likely do the same with bottled Teavana. The first product in the line will not be ready for sale until sometime in the first half of 2017.
Starbucks bought the Teavana brand in 2012 with intentions of igniting interest in quality teas, just as it had with coffee starting in 1971. It opened five tea parlors that operated under the Teavana name, but closed or converted all but one into Starbucks coffeehouses.
Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.