THE TEA HOUSE PROJECT Marketing Research Team Reshma Gala Shawn Kline Jae-Yeon Joo Amol Chopra MKTG-652

THE TEA HOUSE THE TEA HOUSE PROJECTPROJECT

Marketing Research Team

Reshma Gala Shawn Kline Jae-Yeon Joo

Amol Chopra MKTG-652

November 20, 2002 MKTG 652

Drexel University

Introduction: The Concept

Coffee a very popular beverage among Americans.

Presence and success of cafés specializing in coffee. Example: Starbucks and Cosi

No predominant presence of café specializing in serving tea


Drexel University

Introduction: The Concept

Success of coffee and cafés in tea drinking countries, ex: India, Taiwan, Korea, China, Russia

Therefore test the feasibility of tea and tea house in coffee drinking country America, specifically in the tri-state area.


Drexel University

Purpose of Research

Is it feasible to introduce a Tea House in the tri-state area?

Who should be our target market? What are the current consumption

patterns of our target market? What price should we charge for a cup of

tea? Will the “Tea House” concept work?


Drexel University

Objectives and Hypothesis Men and women between the age group of 18

and 30 years, both students and young working professionals, with a higher disposable income would be willing to visit Tea House

People would be willing to pay between $1 and $3 for a cup of tea

People already visiting café would be willing to visit Tea House


Drexel University

Objectives and Hypothesis People giving more importance to

nutritional value while choosing a beverage would be willing to visit Tea House

Recognize a pattern as to the part of the day people would be willing to visit the Tea House

Understand the ethnic background of people willing to visit the Tea House


Drexel University

Objectives and Hypothesis General awareness of different types of tea

– Black Tea, Green Tea, Oolong Tea, Chai General awareness of different forms of

tea consumption– Tea bags, Iced Tea, Loose Tea

Places people generally buy their beverages from– Convenience stores, vending machines


Drexel University

Objectives and Hypothesis

Understand the current café-visit habits– Frequency of visit– Accomplice – Average spending per visit– Other products consumed in a café


Drexel University

Survey

Sample Size: 99 Location: Pennsylvania, New Jersey, and

Delaware Collected at work places and colleges

(Drexel & UD) Convenience sample was used for pretest

of questionnaire


Drexel University

SurveyDemographic info of respondents

AGE

18-30

53%

31-40

26%

41-55

20%

55-above

1%

GENDER

Male

39%

Female

61%


Drexel University

INCOME

below 25k

40%

25k~ 35k

8%

35k-50k

20%

50k-75k

14%

75k-100k

17%

100k-above

1%


OCCUPATION

Student

40%

Working Professional57%

Others

3%


Drexel University


ORIGIN

African American

19%

Asian

25%

Caucasian

51%

Hispanic

4%

Other

1%


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Questionnaire

22 Questions– Nominal scale: gender, origin– Interval scale: income, price related– Ordinal scale: consumption pattern– Ratio scale: income, frequency of visit café– Open end question


Drexel University

Target Market Analysis: Age

Ho: Decision to visit a tea house is independent of the age of a person

Ha: Decision to visit a tea house depends on the age of a person.

Analysis: Asymp. Sig. (2 sided) > 0.05 ACCEPT NULL Conclusion: People in the age group of 18

to 30 will not necessarily visit a tea house.


Drexel University

Impact of Age on Visit to Tea House

0 00

35 3145

100

65 6955

0

20

40

60

80

100

120

Under 18 18 - 30 31 - 40 41 - 55 Over 56

Age

Per

cent

age

Will not Visit

Will Visit

Note : Number of respondents under age of 18 = 0 & over age of 56 = 1


Drexel University

Target Market Analysis: Income

Ho: Decision to visit a tea house is independent of the income of a person

Ha: Decision to visit a tea house is dependent on the person’s income

Analysis: As Asymp. Sig. (2 sided) > 0.05 ACCEPT NULL Conclusion: Persons with a high disposable

income of over $50,000 p.a. will not necessarily visit a tea house


Drexel University

Impact of Income on Visit to Tea House

6585

65 6279

30

3515

35 38

29

70

0

20

40

60

80

100

120

Below 25

,000

25,00

0-35

,000

35,00

1-50

,000

50,00

1-75

,000

75,00

1-10

0,000

100,0

00 an

d Abov

e

Income in $

Per

cent

age

Will not Visit

Will Visit


Drexel University

Target Market Analysis: Gender

Ho: Decision to visit a tea house is independent of the gender of the person

Ha: Decision to visit a tea house is dependent on the gender of a person

Analysis: As Asymp. Sig. (2 sided) > 0.05 ACCEPT NULL Conclusion: No indication that a particular

gender group would be more inclined to visit a tea house, than another group.


Drexel University

Impact of Gender on Visit to Tea House

70

53

30

47

0

20

40

60

80

100

120

Female Male

Gender

Per

cent

age

Will Not Visit

Will Visit


Drexel University

Target Market Analysis: Occupation

Ho: Decision to visit a tea house is independent of the occupation of a person

Ha: Decision to visit a tea house is dependent on the occupation of a person

Analysis: As Asymp. Sig. (2 sided) > 0.05 ACCEPT NULL Conclusion: It is not necessary that only student

will be interested in visiting the tea house.


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Impact of Occupation on Visit to Tea House

64 63

0

67

36 37

0

33

0

20

40

60

80

100

120

Stud

ent

Wor

king

Pro

fess

iona

l

Ret

ired

Oth

ers

Occupation

Per

cent

age

Will Not Visit

Will Visit

Note : Number of retired respondents = 1


Drexel University

Target Market Analysis: Origin

Ho: Decision to visit a tea house is independent of the origin of a person

Ha: Decision to visit a tea house is dependent on the origin of a person

Analysis: As Asymp. Sig. (2 sided) > 0.05 ACCEPT NULL Conclusion: It is not necessary that persons

belonging to a certain ethnic background will be interested in visiting the tea house.


Drexel University

Impact of Ethnic Background on Visit to Tea House

2233 40

75

0

100

25

606778

0

20

40

60

80

100

120

Africa

n Am

erica

nAsia

n

Cauca

sian

Hisp

anic

Oth

ers

Origin

Per

cent

age

Will Not Visit

Will Visit

Note : Number of respondents from ‘other’ background = 1


Drexel University

Consumption Patterns Ho: Decision to visit a tea house is

independent of the decision to visit cafes Ha: Decision to visit a tea house is

dependent of the decision to visit cafes Analysis

– Asymp. Sig. <.05; REJECT NULL– Conclusion: People who currently visit cafes

are more likely to visit a tea house


Drexel University

Consumption Patterns (continued)

Ho: Decision to visit a tea house is independent of the individual’s concern for nutrition

Ha: Decision to visit a tea house is dependent of the individual’s concern for nutrition

Analysis:– Asymp. Sig. >.05; ACCEPT NULL– Conclusion: People who are concerned about

nutritional value of their beverages will not necessarily visit a tea house


Drexel University

Consumers' Awareness of Tea

9388

7267 63

43

5 2

611

2732 36

56

94 91

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Gree

nTe

a

Herb

alTe

a

Deca

fTe

a

Blac

kTe

a

Chai

Tea

Oolon

gTe

a

Othe

rs

White Te

a

Unaware

Aware


Drexel University

Tea Consumption Patterns

78 75

38

4 1

21 24

61

95 98

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Tea Bags Iced Tea Loose Tea Others None

Do Not Drink

Drink


Drexel University

Preferred Time to Visit a Tea House

29

8

17

2926

29

5

59

80

71

5962

59

83

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

EarlyMorning

Before Noon EarlyAfternoon

LateAfternoon

EarlyEvening

Late Evening Other

Would Not Visit

Would Visit


Drexel University

Pricing

Assumption: Majority of visitor would pay $1 ~ $2.99 for a cup of tea

Result of Frequency test: very supportive – Under $1: 11.2%

– $1 ~ $2.99: 71.9%– $3 ~ $ 4.99: 13.5%– $5 ~ $6.99, $7 ~ 9.99, & $10 ~ above: 1.1% each

* Majority of People(30.2%) who willing to visit Tea House answered they pay for $3 ~ $6.99 per visit in Café


Drexel University

Appraisal

Diversity of respondents with regard to gender, age, income and occupation

Questionnaire :– Short sightedness in including few questions– Difficulty in analyzing open ended questions– Structure of some questions


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Future Opportunities

First Step – Green Signal– overall acceptance among variety of age groups,

income segments and occupations.

Further research and analysis can be done on – specific location– frequency of visit to a tea house– snacks to be served along with tea– ambience people would be expecting in the Tea House– secondary research


Drexel University

Summary Primary Research on ‘Feasibility of a Tea

House’ in the Tri-state area. Survey by using Questionnaire. Statistical Analysis using SPSS Statistical Tools

– Cross tabulation– Frequency Counts


Drexel University

Conclusion

An executable idea – ‘Tea House’ Accepted by the market Further analysis required for specific

aspects


Drexel University

Thank You!!!

Questions?

Documents

THE TEA HOUSE PROJECT Marketing Research Team Reshma Gala Shawn Kline Jae-Yeon Joo Amol Chopra MKTG-652