Eight years ago The Greenstone Drinks Co. was a fresh-faced start-up marketing its Teza Iced Tea brand with the help of distinctive grass-covered vehicles. These days the company has matured significantly, enjoying success across the Tasman, and it’s owners are focused on new products.
By Glenn Baker.
Eight years is a lifetime when you’re in the boutique beverage market. In 2008 Joe Gehrke and Daphne Raj launched their iced tea business Teza, and quickly gained attention by covering their little company cars in long fake grass to make them look like a mobile tea bush.
While it’s debatable the cars actually sold iced tea to the unconverted, it was certainly a useful way to gain the attention of the publicity merchants at the time, and much less expensive than plastering the brand on billboards.
So why iced tea back then? A Herald article in December 2008 described how the couple had returned from a seven year working stint in London two years prior, with the idea of starting up their own business. It was always going to be a food-related business as Joe has a Masters in Bio-processing and helped create products for the likes of Nestle, Kraft and Fonterra. Daphne has a Masters in Biochemistry and worked as a commercial manager for R&D firms in the food industry.
They soon discovered that the iced tea offerings in this country were sadly lacking, and the idea for producing their own range was cemented after road-trips through Europe and the US, where everybody seems to drink it. Iced tea fitted with their vision to create a lighter, 100 percent-natural beverage.
After 19 months developing their Teza range, and using their friends as guinea pigs, Joe and Daphne were in business. It took just nine months for their product, described as a ‘real-brewed iced tea” and consisting of only high-quality ingredients, to go nationwide.
In the first five years Daphne focused on sales, marketing and human resources, while Joe worked on R&D, manufacturing, supply chain, finance and IT.
Earlier this year, when Exporter called on the couple, there was plenty to report – particularly on the export front – specifically Australia.
Achieving café distribution throughout New Zealand happened pretty quickly, explains Joe, so rather than develop more products for this side of the Tasman, the decision was made to focus on an Australian launch.
“Getting our first distributor in Australia was a huge milestone,” he says, “as was securing a distributor in each major Australian city.
“Now that we have a distributor network, we are developing new products to sell into it. Launching our second brand, Fallen Coconut Water, was an exciting milestone in 2015.”
Joe describes coconut water as “nature’s sports drink”, as it contains a number of natural electrolytes.
“But not all coconut waters taste good,” he explains. “Ours is a special Thai drinking coconut variety and is only gently pasteurised within the glass bottle. Our competitors’ are cooked heavily in cans or tetra-paks.”
Both Teza and Fallen Coconut Water have now been listed in David Jones stores, which Joe says is something of a milestone for ‘making it’ in Australia.
Marketing and export lessons
In terms of marketing to cafés and healthy restaurants, Teza’s target market, the biggest challenge is retail penetration. “Being seen in great independent cafés is a form of marketing in itself,” says Joe. “However you need to be in thousands of them before you can make decent revenue. And competition is fierce.
“Once you have penetration, getting some PR is always great, and consumer sampling is important for new concepts like ours.”
Joe’s advice to other F&B start-ups is to keep talking with consumers, and renovate your brand regularly based on changing consumer views.
“Recently there has been huge concern about sugar, which is great, as we'd love people’s palates to change to lighter drinks. Iced tea is a lighter option and Teza has 40 percent less sugar than leading soft drinks or juices. However, in the media iced tea is often grouped in with sugary carbonated soft-drinks, so we recently updated our design offering to better communicate that Teza is light and natural.”
Joe and Daphne have had to modify their export focus over the years too, in order to better manage the growth of the company.
“In the past we’ve spent time and money pursuing enquiries from the US and various Asian markets,” explains Joe. “But after market visits and research, we found these markets are extremely price competitive for our types of products. They also present numerous other cultural and regulatory difficulties, whereas Australia is more straightforward.”
He says they now minimise their time chasing ‘opportunistic’ export enquiries, and focus more on their strategic export market, which is Australia.
“We aim to treat Australia as our home market, along with New Zealand. But we have quite some way to go to achieve that [same] level of focus in Australia.”
After two years of flying into Australian cities and door-knocking themselves, often fruitlessly, Joe and Daphne employed a young Australian on the ground, who proceeded to open doors with distributors and subsequently retailers. As budgets have allowed, sales reps have also been set up.
Joe admits that Australia can a tough market, especially if you’re under-capitalised.
“Generally we’ve found Australians to be tough but fair,” he says. “Once you’ve shown them your stickability and you have some momentum, it opens more doors. Aussies are great to deal with and are very business-like.”
Going forward, he believes there’s enough potential in Australia for Teza’s existing products to keep growing. “Value-wise it is the best export market for our type of products. We'd like to launch more brands in Australia, and we'd love the exchange rate to improve, as profitability is suffering at the moment.”
As for their own work-life circumstances, nowadays the couple have two young children and Daphne has backed away from the business to be a full-time Mum.
“We worked together intensely throughout the start-up phase,” says Joe. “It was an amazing experience to share, and it was certainly challenging at times.
“We learnt how to work as a team in stressful situations, which has transferred nicely to raising kids!”