Unilever opened the first T2 store in the UK late last month, in London's fashionable suburb of Shoreditch. Photo: REUTERS
It was a relatively small investment for a company with annual revenues of $75 billion, but Unilever has grand plans for Melbourne-based gourmet tea retailer T2.
After opening the first T2 store in the UK late last month, Unilever's president for refreshment Kevin Havelock sees scope for hundreds of stores around the world.
''We believe with the excitement in tea among younger people and particularly what T2 and the T2 offering brings, most significant cities in the world would benefit from having a T2,'' said Mr Havelock, who helped negotiate Unilever's acquisition of T2 from founder Maryanne Shearer in September last year. ''I see no long-term limits on the potential for T2.'' Sales of coffee have outpaced tea in the UK for five years, according to Euromonitor, and most Britons under the age of 35 are more likely to drink coffee than tea.
However, at the super-premium end of the market, where T2 has positioned itself, tea sales are rising by about 14 per cent.
Unilever, the world's largest tea company, sees T2 as a way to introduce tea to a new generation of consumers who are initially drawn to the beverage through fruit-flavoured tea and infusions.
''T2 is obviously a fantastic Australian success story - it's focused on innovation and excitement and is bringing a whole new generation of tea users into tea,'' said Mr Havelock. ''We are seeing there is interest in most parts of the world.''
The purchase price was never disclosed but is believed to be less than $100 million, given the fact that T2 had sales last year of $57 million.
At the first T2 store in London, in the trendy suburb of Shoreditch, T2's vanilla-scented Melbourne Breakfast and Liquorice Legs are the best-selling brands, beating sales of the more traditional English Breakfast.
Unilever has retained the signature look of T2's stores - black and orange walls dressed with Chinese newspaper print - and is stocking a range of more than 200 teas as well as tea pots, cups and accessories.
However, the layout of the first T2 store in the UK is not identical to the 40 in Australia and Mr Havelock has not ruled out tweaking the format to suit overseas markets.
''One of the strengths of the model built by Maryanne over the past years has been to learn and evolve store by store,'' he said. ''So within Australia they've been learning as each store has opened [and] we are doing exactly the same thing as we go.''
Unilever has ruled out leveraging the T2 acquisition by taking the brand into supermarkets, where the shelves are dominated by Unilever's Lipton and Bushells brands. Unilever already sells a range of gourmet teas in pyramid-shaped bags in supermarkets, but competition at the upper end of the market is increasing. Last year, Unilever's largest rival, Twinings, launched a new range of boutique teas with ingredients such as lavender leaves, white jasmine and spearmint leaves.
''T2 brings a luxury experience - it's the experience in the store, it's re-creating the loose tea market and it's stretching boundaries of excitement on tea,'' said Mr Havelock.