Retail

Reading The Tea Leaves For Steeping Subscription Success

Reading The Tea Leaves For Subscription Success

Before Knud Berthelsen founded personalized subscription service Free Your Tea, he found it challenging to find good teas, Berthelsen told PYMNTS in an interview. It is not difficult, however, to find other varieties of beverages – one only has to go to a coffee shop and the barista will help them find exactly what they want. And bartenders can help with craft beer or cocktails, while a sommelier can assist with wine. But when it came to teas, Berthelsen found himself buying lots of varieties – “expensive, large-format teas” – only to find out he didn’t like them.

In reading the labels, Berthelsen found that none of them made a whole lot of sense. He also found that a lot of his friends were drinking fancy coffee and good beers, but not the same caliber of teas. That experience was the inspiration behind Free Your Tea, to “let people discover new teas over time,” he said.

The base plan offers customers a day’s worth of tea every month. When they sign up online, the company sends them a sampler right away, which includes six different teas that Berthelsen said are “as different as they can be.” The company then asks customers to rate those teas. Based on those ratings and other customer-provided preferences, the company will have enough data “to start tailoring teas to their tastes,” said Berthelsen.

From that point on, customers will receive a new tea in the first week of the month. That includes a full-sized bag that is big enough for about one daily cup of tea tailored to the customers’ data and preferences. Customers also receive one free sample that is not tailored to their tastes. The company sources teas from all over the world, and just launched a caffeine-free subscription.

Customers can pay for their subscriptions by PayPal, credit card or debit card.

The Target Market

Free Your Tea’s target market includes foodies who care about quality food and beverages and are willing to try teas unlike what they’ve had before. “They understand the whole concept,” Berthelsen said.

He also pointed out that there are many tea drinkers out there – in fact, tea can be found in nearly eight out of 10 U.S. households, per The Tea Association of the U.S.A. Inc. The group notes that “it is the only beverage commonly served hot or iced, anytime, anywhere, for any occasion.” It also points out that “on any given day, over 159 million Americans are drinking tea.” Berthelsen noted that some four out of five Americas drink tea, as do 87 percent of millennials.

Berthelsen also noted that Free Your Tea attracts many people who simply like subscriptions. Gifting is also a large part of the company’s business. “People don’t think it’s too complicated to give subscriptions as gifts,” he said. With the gift offering, the company sends a sampler pack to the recipient. Beginning with the second shipment, they will receive hand-picked teas based on their ratings.

Berthelsen noted that the company doesn’t have to educate anyone on how the subscription model works: “People get it,” he said. He also added that the evolution of craft beer and third-wave coffee “has opened doors for us.”

Beyond Free Your Tea, other eCommerce innovators are offering consumers tea subscriptions. Jacqueline’s Teas, for instance, offers seasonal teas with recipes for soups and desserts with its namesake Jacqueline’s Teas subscription. And Cusa Tea offers its instant teas on an eCommerce website for shoppers to buy as a subscription or one-time purchase.

With the help of personalized subscriptions, online platforms like Free Your Tea are steeping eCommerce innovation by helping consumers discover their new favorite teas through regular deliveries.

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