by Lindsey Goodwin

The Sullivan nod. Value-adds. Up-selling. The world of sales tactics can be daunting for tea business owners. Institutions like The Plaza have dropped their afternoon tea prices, while tea retailers are giving away samples and offering free shipping to keep the cash coming, but what really works in recessionary times and beyond? World Tea News investigates.

The basics

Successful sales tactics vary from business to business, but some core techniques – mark-downs, value-added offers and sampling – are effective for almost everyone.

Percentage-off sales are a basic way to get customers to buy. Many companies offer discounts to all customers, but another approach is to target specific groups. For example, Jeffrey Lorien, co-owner of Zhi Tea, e-mails discounts on featured products or entire orders to established customers to encourage brand loyalty, and hands out order discount cards to build his customer base.

Lorien also offers free shipping on orders over $75 to encourage larger orders. Freebies like this are an example of value-added sales, another common way of stimulating receipts. Ginny Durand said free gift-wrapping encourages return customers to The Tea Exchange, which she co-founded.

Buy-something-get-something specials, another type of value-add usually reserved for excess stock, helped Whatever Works Wellness owner Connie Lasorso increase sales of clear tea Thermoses when she offered free flowering teas with Thermos purchases. She also includes discounts and freebies with a tea-tin recycling program – perhaps part of the reason her sales have doubled over the last year.

Jesse Jacobs, owner of Samovar Tea Lounge, upped his sales with $10 lunch specials (including tea) during traditionally slower weekday hours. He said it converted customers who aren’t normally attracted to tea, because “it’s a lower price point entry. They realize the value and walk out with a tin of tea.”

Sampling is another sales-booster. Durand and Lorien send samples with online orders to encourage customer loyalty, and Lorien credits a 40 percent increase in sales over the last year largely to the more than 10,000 steeped tea samples he has handed out. Durand provides coffee drinkers with a customized tea sample whenever they buy coffee, noting, “They always come back.”

Customer loyalty and expansion

When applying these techniques, businesses have to strike a balance between finding new and keeping established customers. Global marketing specialist Suzanne Brown of The Partnership, Inc. and tea author and consultant Diana Rosen said new customers should always be top priority, but retaining regulars is also important.

On the other hand, Jacobs said he prefers to keep customers loyal and let the business grow organically.

Staff training is one way to encourage return customers and attract new ones through word-of-mouth. Brown and Rosen no investment is more worth its price than staff training. An enthusiastic, well-informed staff begets more sales, they added.

Subtle suggestions

The Sullivan nod may be difficult to master, but sources swore by other suggestive selling techniques.

Jacobs implemented simple procedures involving customer service and up-selling that he said have nearly doubled his retail tea sales.

Factors such as customers’ tastes and moods, weather and time of day should influence sales suggestions, according to sources. Lorien said he emphasizes the experience of a tea (“soothing”) rather than the objective facts (“high in antioxidants”) with good results.

Brown and Rosen added that offering take-away menus or complete tea lists, checking in with customers often, providing signage on products and asking the customers if they have any questions are all subtle techniques that can boost sales.

Pricing structure also indirectly influences customers’ purchasing decisions. Vertical pricing gives customers a feeling of control and skews them toward mid-range purchases, regardless of how much those are. For example, Jacobs said the addition of a $50 per pot gyokuro to his menu caused sales of an $18 per pot gyokuro – now, seemingly mid-range – to skyrocket.

Likewise, sources said, simplified structures such as tiered pricing and uniform refill sizes help avoid overwhelming new customers.

The up side of a down economy

The tea industry has an advantage in the current economy, according to those interviewed. Many tea businesses are seeing customers move away from $5 coffee lattes and toward the value of home-brewed loose tea.

Lasorso said, “The recession only means that there are more people who want an affordable alternative to Starbucks. We can sell them a month’s worth of tea for $5.”

Brown and Rosen said that now, more than ever, is the time to innovate; take the economic situation and turn it into a positive one for tea businesses.

The calming, ritual component of tea is another major driver for sales. If you help others “manage the stress of the times,” Lasorso said, “then your business will take care of itself.”