Starbucks Corp. has just brandished a new weapon in its battle to rule the global tea market while keeping its soul: Oprah Winfrey.
Winfrey joined Chief Executive Howard Schultz on stage at the company’s annual shareholder meeting Wednesday to announce the release of Teavana Oprah Chai — a blend designed in part by the superstar. For each Oprah Chai product sold, the company will make a donation to her youth-education initiatives.
“You get a chai, you get a chai, you get chai; everybody gets a chai,” Winfrey said, pointing to shareholders in the manner familiar to viewers of her TV show.
She sat in a white chair next to Schultz, who has been a guest on Winfrey’s TV program and this time played the role of the interviewer. Shareholders, who have been riding high after a blockbuster year for the company, roared with delight.
Starbucks’ deal with Winfrey comes as the Seattle coffee giant seeks to reassure investors that it can keep growing. On Wednesday, Schultz said that the company can attain a market capitalization of $100 billion, up from about $57 billion now.
But for that, Starbucks need new markets, and tea represents a $90 billion market opportunity that the company can disrupt in the same way it transformed the coffee market, company executives say. So in 2012 Starbucks acquired Teavana, a fine-teas retailer with hundreds at stores in malls. Recently Starbucks opened Teavana-branded tea bars in New York and Seattle, and the company intends to open similar venues this year in Chicago, Los Angeles and other parts of New York City.
Winfrey’s presence at the shareholder meeting, a highly produced affair that traditionally features energetic speeches and live performances, helped drive the point home to shareholders.
Shares rose 1.8 percent to $75.91 Wednesday, a day when the Dow Jones industrial average fell 0.7 percent.
“Oprah and Howard, how can they lose?” said Lynn Gracey, a longtime Starbucks shareholder from Lakewood, Wash., adding that at the meeting he and his wife had gotten “their money’s worth.”
There were about 3,000 shareholders in attendance Wednesday. Along with company staffers, they filled McCaw Hall at Seattle Center.
Source: MCT Information Services