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Starbucks Makes Teavana Its Biggest Bet Yet

NEW YORK (TheStreet) -- Coffee and tea are different things.

Coffee is quick. Tea is slow. Coffee means sweet. Tea means salt. Coffee is utilitarian. Tea is ceremonial. Coffee is the sunrise. Tea is the sunset. Coffee is a cup. Tea is a pot. Coffee is male. Tea is female.

For these reasons the Teavana chain, which Starbucks (SBUX) bought last year, sold loose tea and offered samples. The company also sold pots, cups and other paraphernalia. Its main mission was to get people out of thinking that those little bags my mom bought to stick in cups were really tea.

At the time of the Teavana acquisition, Starbucks was selling those same little bags in its coffee shops, alongside its coffee drinks. The bags came from Tazo, which Starbucks acquired in 1999, and although they were quite good, they were tea in a coffee shop.

I love tea, especially green tea, but all the tea bars I ever found near my home in Atlanta closed quickly, because they couldn't deliver the traffic and the ticket size to make the business work. Once you buy an ounce of tea and learn how to make it right, you're set for weeks. While there was a successful model for Starbucks in retail coffee, in other words, it's lacking in tea.

What Starbucks did with coffee was to make it high-end, something you would gladly spend $5 a cup on. Good tea is already high-end, but there's no retail model that works for it.

The tea shop Starbucks planned is opening this week is on Manhattan's Upper East Side. It's located where people live, not where they work. It combines a Teavana store, selling loose tea, with a Starbucks-like bar selling a few teas, some tea-based drinks and small plates of food.

It's elegant, it's replicable, and it seems to acknowledge that drinking loose tea is different from grabbing a cup of coffee. Loose teas typically sell for $5 an ounce and more, and cups of tea can sell for up to $5 each, but if you're used to iced tea or your mom's tea this is a high price and a unique experience.

Stock quotes in this article: SBUX 

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