Since our very earliest days as Starbucks Coffee, Tea and Spices, Starbucks has been heavily invested in the tea business. Back in those days, we scooped 27 different varieties of tea for our customers in the original Pike Place Market store – and after acquiring Tazo back in 1999, our commitment and passion for tea only increased further as that brand became an established part of our portfolio in both our stores and in grocery channels.
Today I am delighted to share with you the exciting news that on the back of a record financial performance for Starbucks in our fourth quarter and fiscal 2012, Starbucks has entered into an agreement to acquire Teavana. This transaction should signal that we have moved our plan to fundamentally transform the consumer tea experience in both North American and international markets into high gear.
Over the past 15 years, Teavana has built world-class capabilities in tea authority, global sourcing, merchandising and best-in-class retail store unit economics around its single-origin estate teas. Teavana’s considerable tea expertise, coupled with the romance and theater of the retail experience that is at the very heart of Starbucks heritage, will create a differentiated customer experience.
Our enthusiasm for this news is matched by a commitment to continue growing Tazo – an already thriving $1.4 billion brand for Starbucks. Teavana complements Tazo and, in fact, unleashes Tazo to compete aggressively as our premium entry point for consumers seeking an innovative and differentiated tea experience while providing us with flexibility to pursue a two-tiered global tea marketing strategy.
We are excited about what’s ahead and welcome your continued thoughts and feedback as we redefine the tea experience for customers around the globe.