Tea in the Experience Economy. Reasons Why You Mustn’t Work with Tea Like with Wine or Coffee

Ceylon White Tea

In 1999, Harvard Business School published Pine and Gilmore’s book The Experience Economy, in which the authors presented an elegant concept of a new, post-service economy — the economy of experience. In contrast to the agrarian, industrial or service economy, in the experience economy, the company uses goods and services as the scenery to create for the customer an experience, which becomes the main commodity. The concept of a service economy is not universal and not indisputable, but, in our opinion, it suits very well as a productive approach to consumer tea culture. Especially taking into account the fact that consumer tea culture is cramped within the agrarian, industrial or service economy, — unlike, for example, wine or coffee culture.

To understand this, it is enough to simulate the chain of actions that most often precede the appearance of a glass of wine, a cup of coffee or a cup of tea on the consumer’s table. Here is the wine chain: buy a bottle — open a bottle — pour wine into glasses. Here’s a coffee one: visit a cafe — order coffee — get a cup. And, finally, a tea one: buy tea leaves — brew tea — pour tea into cups.

The consumer most often receives wine in the form of a bottle, and it is almost ready to drink, all the final steps (opening, sometimes decanting, pouring) the consumer can happily and easily do on their own. Wine reaches the consumer as a product with a high degree of quality stability. While there are purely service things in wine culture, we can still say that wine exists in an industrial paradigm. The main business initiative in consumer wine culture belongs to wine producers. They also shape the quality standards of wine and drive the fashion for it. Biodynamics, qvevri, the transition from sweet and fortified to dry and light, fashion for specific varieties and countries — all this is initiated by wine producers.

Consumers in recent years prefer to receive coffee in the form of a cup prepared personally for them by a specially trained person or machine. That is, coffee most often reaches the consumer in the form of a service — therefore, the service approach dominates in the coffee consumer culture. The business initiative is shared there by producers of coffee and coffee services (and equipment for providing these services). Coffee is the perfect service product. Therefore, despite attempts to create a commodity fashion (different processing of beans, new regions, etc.), the coffee culture is driven by purely service micro-trends (various manual brewing methods, latte art, etc.). And, of course, in the consumer coffee culture, service quality criteria are highly valued — so that everything shines and everyone smiles.

But in the tea consumer culture, everything is somewhat more complicated. Like coffee, tea can be consumed in three forms. In the form of raw material, requiring some effort to turn into a ready-to-consume product (it must be brewed). In the form of a product ready for almost immediate use (making tea is easy). And as a service (when we order tea in a cafe or a tea house). But unlike coffee (and wine), none of these tea guises (commodity, product, service) dominate the tea culture. That is why it is very difficult to apply wine and coffee approaches to tea.

Tea is not industrial enough to work according to the wine scheme. Unlike wine, tea is not always ready for consumption immediately after purchase. Moreover, some tea changes rapidly during storage, which makes it useless to identify the product by label — and this is one of the main tools for the development of wine consumer culture. The need to brew tea and its instability during storage make many wine-based demand management methods (for example, something similar to the wine critics institution) ineffective.

Tea is too industrial to develop according to the coffee scheme (i.e., service). The coffee service is based on the confidence of all market participants that a visitor to a coffee shop cannot prepare delicious coffee on their own. And the barista demonstrates to us that their coffee with milk and sugar is cooler than the one that can be made in a home coffee maker. This approach does not work with tea (we are talking, of course, about a mass scale systemic result, and not about phenomena that are and will always be). Tea is so cheap and so easy to brew that any person in a dozen or two attempts will reveal in any tea all its possible consumer characteristics. In such circumstances, entrusting the brewing of tea to someone else, especially for money, is almost always pointless.

That is why the preparation and serving of tea has not become an independent, mass-scale, demanded and high-margin service even in countries with developed out-of-home tea consumption (Turkey, Iran, Great Britain, etc.). Teahouses there sell anything, but tea craftsmanship.

So. The development of tea as a commodity (wine scheme) is hampered by the fact that tea is too complex for in-house consumption. At the same time, the development of tea as a service (coffee scheme) is hampered by the fact that it is too easy for in-house consumption. It’s a beautiful dead end which has three ways out: two obvious and one less obvious. Our next article will be devoted to the obvious ways out — simplifying and complicating tea consumption. The less obvious way out is working with tea in the experience economy paradigm; we’ll talk about it in two or three articles.

Olga Nikandrova & Denis Shumakov. Teatips.info. 2021