Vision India 2020: Darjeeling

Our family has long been a connoisseur of Darjeeling tea. Growing up in Bengal, it is hard not to be.

Later on, when I started living in the San Francisco Bay Area, I got to experience the cult of wine in Napa Valley and the surrounding wine countries. One September, I even worked in a vineyard in Oregon, pruning grapes, while visiting my friend Dave Chen, whose Patton Valley vineyard is a small producer of fine Pinot Noir.

My curiosity about business led me to ask the question, why is India not capable of marketing tea the way wine is marketed by California, Oregon, Australia, New Zealand, and of course, France and Italy?

My travels have taken me through the wineries in Bordeaux and Tuscany, as well as the Tea Estates in Darjeeling. In fact, in January 2006, we stayed in Glenburn Tea Estate, a spectacularly renovated Bungalow, and it is there that my thoughts on how to market Darjeeling Tea started coming together.

So, when we started Darjeeling, our Tea Lounge venture, in 2009, the strategy of how we were going to play our cards was well thought through. We did pretty extensive analysis on how the tea industry operated, and had determined certain fundamental business model shifts that were required.

Our first observation was that Tea was treated as a commodity, and sold in bulk, mostly. As a result, the big brands like Lipton and Tetley were buying in bulk, blending to achieve a certain relatively low cost structure, and producing not very good tea in tea bags.

In contrast, the top wines are the pride and joy of their makers, crafted with tremendous passion.

At Glenburn, the manager of the estate had explained some of the details of the four flushes of tea: First, Second, Monsoon and Autumn flush. Of these, the Monsoon flush is not good tea. But Glenburn’s First, Second and Autumn flushes were all splendid.

My thought was that if some of the 80 odd Tea Estates in Darjeeling were taught to produce their own tea, crafted in a similar way as wine is done, and marketed under their own labels, that would be the way to create a classy positioning for Darjeeling Tea in the world market.

In 2010, therefore, we set up partnerships with 10 Estates from which we would buy tea to sell to consumers, not as a commodity, but as a branded product.

We also launched our Tea Lounge brand, Darjeeling, and modeled it after the Starbucks concept. However, unlike Starbucks, it was an elegant lounge that served the choicest Darjeeling tea (10 Estates, 3 flushes from each), and a selection of delicate accompaniments like tea sandwiches, crumpets and pastries, served in beautiful European porcelain tea sets.

We started with lounges in Mumbai, Delhi, Kolkata, Bangalore, Pune, Hyderabad, and Chennai. By 2012, we had multiple lounges in each of those cities, as well as in London, Paris, Rome, New York, Boston, San Francisco, Los Angeles, Chicago, Seattle and Barcelona.

By 2015, we had penetrated North America, Europe, China, and Latin America, as well as India, of course, in a very meaningful way. At that point, we owned 40 of the 80 odd estates in Darjeeling. We not only sold packaged tea through our Lounges, we also had a large market share at the high-end grocery stores like Whole Foods Market, Trader Joe’s, etc.

We were marketing about 150 different labels of tea, and we created an entire vocabulary around how to understand and appreciate tea – not only by taste, but also as a way of life.

“Afternoon Tea at Darjeeling,” wrote the New York Times, “is the new way of doing business.” Slow, refined, and grounded in human relationships – that was the essence of the Darjeeling brand.

We were not about WiFi. In fact, we did not allow laptops in the lounges at all.

In 2018, we entered a new business, not so much for revenue or profitability reasons, but rather for branding reasons. At each of our 40 Estates in the Darjeeling Himalayas, we created 5-8 room boutique hotels. For this, our model was the Glenburn experience – luxurious, splendidly beautiful, and steeped in the warmth of hospitality that was characteristic of our tea garden staff. [Read my North Bengal Travelogue for a taste of the Glenburn experience.]

This was a reliving of the British Raj experience that tourists from all over the world came to savor.

My dream, by 2020, had come true. Darjeeling, the queen of the Himalayas, was shining in full glory again, with the magnificent snow-capped Kanchendzonga range smiling in approval. And our $4 Billion enterprise was serving cups and cups of superb tea to a world of newly created connoisseurs.

Note: Vision India 2020 was subsequently published as a book. You can order it from Amazon, Kindle, Amazon.in, etc.

A call to Indian entrepreneurs everywhere, Vision India 2020 challenges and inspires readers to build the future now. In this “futuristic retrospective,” author Sramana Mitra shows how over the next decade, start-up companies in India could be turned into billion-dollar enterprises. Vision India 2020, which encompasses a wide range of sectors from technology to infrastructure, healthcare to education, environmental issues to entertainment, proves how even the most sizeable problems can be solved by exercising bold, ambitious measures. Renowned in the business world, author Sramana Mitra conceived Vision India 2020 from her years of experience as a Silicon Valley strategy consultant and entrepreneur. Well aware of the challenges facing today’s aspiring entrepreneurs, Mitra provides strategies, business models, references, and comparables as a guide to help entrepreneurs manifest their own world-changing ideas. 

This segment is a part in the series : Vision India 2020

Comments

Hi,

We were planning exactly the same concept last year but eventually had to give up after a struggle of 6 months due to lack of funds.
I sincerely believe that tea can take on coffee if marketed properly. Where was coffee 10 years back?Its just marketing techniques of west that are gradually turning India from a tea drinking nation to a nation of coffee drinkers. People dont even take into account the health benefits tea provides.
Its nothing just pure marketing.!!

Regards,

Anshul Monday, May 26, 2008 at 11:57 AM PT

My dear friend (above) seems to have given up ;-).

I havent thou! I have been working on the same since the past 18 Months due to lack of funds and sudden appreciation of the Real estate prices, its kind of on the back burners(somewhat)…but it will soon be a reality.

All fundamentals of the in, out and around the industry, the habits and lifestyle of the people point out at tea becoming not only an Urban Living concept but also a niche Upmarket concept on the lines of wine…sooner or later.

The need has changed from “Developing the Market” to “Tapping the Market”…

Amit Monday, May 26, 2008 at 11:18 PM PT

Oh man! If I try 10 times I can make it correct only once and even that is a little bit of stretch on probability. This ‘Tea’ is a very sensitive thing and the taste depends heavily on how good one makes it. Even these tea bags don’t help me as the taste depends on how warm is the water and how long you dip it. Too complex for trying to impress somebody with a good cup of tea. I think the tea processing and usability analysis hasn’t gone to that level where you can just follow a process which is easy and quick and automated which can consistently gives out good hot cups of tea unlike coffee where the taste depends on the brand and the quantity you are adding to boiling temperature water!

I wish I land up in one of those Tea Lounge and it doesn’t cost through the roof!

Santanu Tuesday, May 27, 2008 at 1:59 PM PT

Hey Amit, which city are you based??
Would love to have a chat with you over a cup of hot darjeeling !!!

Regards,

Anshul Wednesday, May 28, 2008 at 1:55 AM PT

[…] Darjeeling: A Tea Lounge Brand and Renaissance: A Heritage Holidays Brand. […]

Vision India 2020: More Multi-Billion Dollar Venture Ideas at VentureWoods - India's leading venture capital community Sunday, June 1, 2008 at 7:20 PM PT

[…] are the current articles in the Vision India 202 series: MIT India, Urja, Lucid, Darjeeling, Renaissance, Gangotri, Maya Ray, Elixar, Bioscope, Thakur, and AdiShakti. […]

Vision India 2020 Saturday, July 26, 2008 at 6:26 AM PT

Hi…..
I am really looking forward to start up something like this, a tea lounge…. however, most of discussions are negative to venture into this business.

I want to discuss this in detail. Please let me know the best time …..

Thanks
Sajag
sajag.chikarsal@gmail.com

sajag Monday, July 28, 2008 at 3:35 PM PT

Sramana,
Interestingly, In Vasant Vihar – new delhi there is Tea – lounge called “passion cup of tea”. The place is doing really well.
Idea of tea based tourism has ex-situ and in-situ potential.

karmveer rathore Wednesday, August 6, 2008 at 5:34 AM PT

He…its a great idea..I have all these ideas to transfer these little nuances of Bengal/Calcutta to the world. Have also got an organisation called kolkata_nostalgia in Pune which aims to create a platform for communicating these ideas to the people here and then replicate across various cities in India and globally…..

Sudakshina Thursday, August 7, 2008 at 4:15 AM PT

[…] segments of the running series can be accessed at MIT India, Urja, Lucid, Darjeeling, Renaissance, Gangotri, Maya Ray, Elixar, Bioscope, Thakur, AdiShakti, Framed Ivory, Oishi, <a […]

The Indian Economy Blog » Entrepreneurship Vision India 2020 Tuesday, August 19, 2008 at 7:33 AM PT

I loved the note and it’s buzz of possibilities. There is a wonderful lounge in New Delhi called simply the TEA LOUNGE at the Taj Palace, which has done a very fine job of promoting some 200 types of teas in a very splendid indoor and outdoor setting.

They are doing a fine job of positioning it in the right manner by having an art exhibition within the lounge – different upcoming artists every week.

It’s got quite a fan following with the Delhi’s richer folk and of course the residents of Taj Palace.

Neena Saturday, January 23, 2010 at 7:37 AM PT