Chart a cross-continental course from Shanghai to Bangkok, then onto Dubai and London, and there will be one constant across these four great cities: the enjoyment of a nice cup of tea. And there is one regional company keeping all of them, and many more, well stocked when it comes to the world’s finest brews.
TWG Tea launched in Singapore in 2008 and has quickly expanded to 40 outlets in 14 countries, including six in Southeast Asia. Following on from its boutiques in world famous department stores such as Harrods in London and New York’s Dean & DeLuca, TWG’s latest opening took place on October 31 in Phnom Penh. Co-founder Maranda Barnes sat down with Southeast Asia Globe at the company’s ION Orchard restaurant to discuss brands, business and the meaning of luxury.
Back at the beginning in 2008, there seemed to be a clear gap in the market that you focused on exploiting.
Three years before we came and started up in Singapore, we were already thinking: ‘What can we do in this industry?’ There was no real international brand that was prepared to take tea to the luxury market. There was luxury whiskey and all kinds of other gourmet products, but there was never somebody who said: ‘OK, let’s take tea to another level.’ I think because it is very, very difficult – it’s a product that’s very challenging because every season there are different types of harvests. To tell you the truth, I think there was a niche in the market because it was too much of a pain to develop. You don’t start a luxury brand to make money; you start it because you are passionate about it.
How does one go about creating a luxury brand from scratch?
In general, you had better know your products very, very well. I think that’s a prerequisite. You don’t jump into the luxury industry and make mistakes, otherwise you run into problems. Basically the foundation of our brand is that everyone who is head of a department has either been working in the luxury industry or the tea industry for a very long time. Product knowledge and an understanding of the market are key. To be honest, we never did a study on whether tea would sell in Asia, it’s kind of a no-brainer. I mean, tea is from Asia, a lot of tea drinkers around the world are Asian, but at the same time a lot of people thought we were crazy, saying: “You’re trying to sell tea to the Chinese, it’s like selling ice to an Eskimo.”
It’s no secret that you are somewhat influenced by Mariage Frères.
You’re influenced by the places where you work, and the fact that our president worked for Mariage Frères for 15 years, people immediately assume we must be influenced by them. For us, Mariage Frères is very colonial. It’s very much a French brand and they’re proud that it’s French tea. We didn’t want to be rooted anywhere. First of all we don’t want to be colonial at all, that’s not our intention, that’s not the future of Asia. We wanted to bring [tea] out of that dusty, old world of the 1920s. We wanted to make it fashionable.
Why did you choose to come to Southeast Asia to launch your brand?
Singapore was a great place to launch the brand because there isn’t a very strong tea culture here. We want to represent teas from Africa, from Brazil, from Australia, from Hawaii – we don’t want to be defined by one very strong tea culture and we didn’t want our customers to immediately assume we were specialising in any particular type of tea.
The other reasons are more business related. The fact you could set up a company here in a day, the fact that things work – import/export is very, very easy because they’re not a producer, they’re not trying to protect any local market. The government is also very supportive. It’s like a corporation in Singapore, the way it’s run. It’s not difficult to get in touch with the relevant government boards you might need to support the business. The Singapore tourism board has grants for people who want to create products that talk about Singapore. We never worked with them on it, but they were always very encouraging. They’d bring media to visit TWG Tea because it was a Singapore company. They were very excited and very supportive, so for us it was the right place on every level. Singapore was definitely great for us.
Tell us a little bit about your other Southeast Asian operations.
We’re in Malaysia, Indonesia, Singapore, the Philippines, Thailand and Cambodia. In each of those we have varying numbers of outlets. We were approached by Indonesia and Malaysia within a year [of opening in Singapore]. The distribution went very well and very fast, so we were in five-star hotels and fine-dining restaurants. It was very quick to catch on. We went into most Southeast Asian markets through distribution first. It gave us a good idea of potential in that country and whether that country was ready for an actual office.
What are your impressions of Southeast Asian consumers?
They’re phenomenal. They are very eager for new experiences, they have great taste, they have travelled, they know their products from fluff and marketing, they know the difference. I think Southeast Asian customers like novelty… and they love being appreciated. They will come back to the shop if you remember what they ordered last time.
So, why Cambodia?
The most important thing is having a partner who understands luxury and retail and has a fabulous location. So we have that in [the Vattanac Tower] property, that phenomenal icon in Cambodia, and in Mr Vattanac himself, who fell in love with the brand.
Also, I think especially for an Asian product such as tea, I believe the Asian consumers – whether in Cambodia, in Vietnam, or elsewhere – will want to know more about something that comes from their part of the world. If we can help initiate them and expose them to quality teas, especially as there are so many young people in these markets who are aspiring to a certain quality of life, I believe they will be our customers long-term.
How did you approach entering the UK, which has a strong tea-drinking culture?
We were asked by Harrods to come in and have a small selection of tea bags in their tea hall back in 2010. Over the Christmas period, the tea sold so well. Actually, Mohamed Al Fayed was still at the head. He was very complimentary and asked if we could make a blend for Harrods, which obviously was revolutionary. We made the Harrods tea, based on Earl Grey, which was Mr Fayed’s favourite. Interestingly, you would have thought it would be tourists shopping at Harrods, but they have a loyalty program and their data shows that 60% of our customers there are locals and return customers.
How does a luxury brand succeed in a modern market?
You have to be extremely detail-oriented and you have to train your staff to be the same. Everyone needs to be impeccable all the time, everywhere – whether it’s the little delivery van that needs to be kept washed and in a good state, to the delivery men who need to be well-dressed in their uniforms, to the manner in which staff prepare the boutique for opening. There is much that needs to be done, so many people to hire and invest time in, that I think that is one of the things that discourages people from creating luxury brands. Most of the luxury brands that exist today have been around for the past 200 years. In the US there are a lot of young fashion brands that are luxury, but not really. In the US, it’s luxury if it is profitable. Whereas for us, it’s luxury if it is exceptional and the profits will come from there.
In a mall setting, there are so many luxury brands vying for attention. How do you manage to stand out from the crowd?
It’s a delicate negotiation. I’ve been around the world and have never seen an island boutique like ours in ION Orchard that wasn’t allowed to have walls because it can block the view of the boutiques surrounding it. But our relationship with the other luxury brands is very close. They realised this was something that would be good for them; it would bring the right type of customers and they would linger in the luxury stores which are usually very quiet. It acts as a type of holding ground for these customers. We also work a lot with the luxury brands for their events and VIPs and when they have a customer who spends $50,000 on a necklace they can come in and treat their customer to tea. It’s about the proximity, but it’s also about the same level of service.
How much does the fact that tea is an affordable product help your brand?
We are fortunate, because we can have the young aspiring clients who come in and have products they can choose from. If you go into many luxury brand shops, there are only one or two products that are under, like, $500. But at the same time we also have those products that are exceptional – handmade – such as teapots and gold and platinum teacups that are works of art, because there are customers for them too. It’s part of the whole experience of tea, really, having different products from artisans around the world. If you just have products at a certain price range, then you’re a mid-market brand.
