LONDON -- There are eight Starbucks coffee shops within three blocks of St. Paul's Cathedral here, and all were bustling one recent lunchtime.
Kevin Quinn bought a mocha frappuccino, the first of several Starbucks drinks he said he was likely to consume that day. He also picked up a caffe latte, a cappuccino and a piece of chocolate cake for colleagues, paying GBP 10.60 ($18.55). "I probably spend too much, but I'm addicted now," said Mr. Quinn, a 31-year-old accountant who grew up drinking tea.
Starbucks coffee has invaded England, upsetting the tea cart in a country famous for its afternoon tea. London already has some 200 Starbucks outlets, surpassing New York City, which has 190. All told, there are 466 Starbucks in the United Kingdom, as well as many fast-growing local chains with such names as Caffe Nero and Coffee Republic. Meanwhile, U.K. tea sales have declined 12 percent in the past five years, according to market-research firm Mintel.
That is a momentous shift. After all, tea has been a British staple since the 1600s, and the British Empire's expansion was, at least in part, a search for land to grow tea plants. By the late 18th century, tea had become so closely associated with British colonialism that Bostonians grabbed tea chests and threw them into the harbor to protest British taxes, helping spark the American Revolution.
Traditional Britons don't just drink tea for breakfast. They drink it before, during, after and in between meals. Strong and milky, the drink has long epitomized comfort in Britain's damp gray climate, with tea advertising often suggesting that the remedy for virtually all ailments is a "nice cuppa."
But Britons' taste for tea has waned as their taste for properly brewed coffee has grown. Now, for young Britons in particular, traditional black tea is no longer good enough, and tea makers are busy coming up with new blends -- Twinings offers an orange and lotus-flower one -- as well as new marketing aimed at winning back drinkers.
For years, coffee in Britain was made almost exclusively from instant powder, a pale imitation of the fresh-brewed drink that Americans have long enjoyed over breakfast. But in 1998, the first Starbucks shops opened in the U.K. in affluent London neighborhoods. At first, the chain struggled with high real-estate costs and management problems. But after a change in leadership, it started to spread to smaller towns throughout Britain. Other chains took their cue from Starbucks, and lattes and cappuccinos became part of the lingua franca, especially among young, urban workers enjoying the Internet and stock market booms.
For Starbucks Corp., the British are ideal customers because about 80 percent of them stay in the store to drink their coffee. That gives Starbucks a chance to sell them food, says Martin Coles, president of Starbucks International. In the U.S., by contrast, 80 percent of the customers buy their drinks and leave.
Starbucks in Britain does come with some twists. Its menu includes cheese and marmite sandwiches. (Marmite is a black yeast spread that only the British -- and the citizens of some of their former colonies -- seem able to stomach.) Its local product-development team has also come up with a cold creamy drink called Strawberries and Cream Frappuccino.
Mr. Coles, a Briton now based at Starbucks' Seattle headquarters, attributes the chain's quick growth in Britain to the nation's recent economic boom, coupled with the rise of low air fares. As a result, he says, the British have enough disposable income to pay for the fancy coffee drinks they have discovered on trips to the U.S. and continental Europe. "When I was brought up, it was instant coffee and you added as much milk and sugar (as possible) because it tasted so bad," Mr. Coles says. "You went from bad to less bad, but never to great."
Despite coffee's inroads, Britons still drink more tea per capita than the people of any other country except Ireland, and 10 times the average of Americans, says the Tea Council, a trade association for U.K. tea makers. But they drink about 90 percent of it at home, and even that they are doing less. Tea is available at premium coffee chains, but a cup costs as much as GBP 1.80 ($3.15), which is more than most Britons are willing to pay.
Brenda Dennison, a 56-year-old housewife from North Yorkshire, drinks three to four cups of tea a day, working through one 120-bag box of tea a month. Her favorite is Tetley's black tea, Britain's top seller. To her, Starbucks and its flavored coffee drinks seem too expensive. "I just like my regular tea," she says.
To win younger Brits and justify high prices, some hotels have started to market tea and its trimmings as a special occasion -- a good way to celebrate birthdays and anniversaries. London's Ritz Hotel, where traditional high tea includes scones, finger sandwiches and cake for GBP 34 ($60), has added extra sittings at 11:30 a.m. and 7:30 p.m. Last summer, the Dorcester Hotel switched tea suppliers in order to add new varieties, including African Autumn, a mix of redbush tea and cranberry and orange flavors, and Paris, a black tea mixed with lemony bergamot.
Even Tetley, which introduced tea bags to Britain in the 1950s and is the U.K.'s biggest tea seller, is trying to go younger. Earlier this year, the company, which is owned by India's Tata Tea Ltd., aired a new TV ad starring "Sex and the City" actress Kim Cattral. Clad in a slinky blue dress, Ms. Cattral turns to Auntea, a kindly middle-aged woman, for advice about men. As the two talk, Auntea offers Ms. Cattral a choice of Tetley teas. But after recommending a new camomile blend to help Ms. Cattral sleep, Auntea remarks, "You don't waste much time sleeping, do you?"
To boost its tea sales, Unilever, the No. 2 U.K. tea maker with its Lipton and local PG Tips brands, has invented a machine called the T-Bird. The device looks like an espresso maker but instead brews specialty tea drinks such as spiced tea lattes and strong, dark Lipton tea. Unilever has installed 50 of them in offices, soccer stadiums and resorts in the U.K.
"It's our cappuccino of tea," says Laurence Smith, a marketing manager for Unilever's food service division. He says the machine increases tea sales and lets cafes and restaurants charge more per cup because the tea looks different enough from the tea people make at home.
Unilever also thinks people are turned off by messy tea bags, which make it difficult to drink tea on the go. So it designed a special cup it calls PG2GO, after its PG Tips brand, which is hugely popular in the U.K. The paper cup has a string that reels up the tea bag so there is no need to drain it and throw it out. For the past 18 months, Unilever has sought to sell the cup to restaurant chains, train station cafes and other sites that offer drinks to go.
The Bagel Factory, a chain with 29 stores in greater London, agreed to try the cups because it was fed up with the mess of wet tea bags, says marketing manager Craig Leslie. Since introducing PG2GO last January, it sold 77,000 cups of the tea through the end of August, an increase of 28 percent from the year-earlier period. It also raised its price for a cup to GBP 1.20 from GBP 1.00 and started to feature tea as well as coffee as part of its regular bagel-and-drink combos.
But that won't be enough to win over people like Natasha Rooney. The 22-year-old sales manager discovered Starbucks about five years ago while visiting an uncle in California, and she now goes to one of the chain's stores at least three times a week. "If I'm feeling bad, I get a white mocha latte," she says. "If I'm feeling good, it's a skinny latte."
She persuaded her friend Samantha Brown, a 20-year-old marketing manager, to give Starbucks a try even though Ms. Brown didn't like coffee. "This is the fifth time I've been here in the last week," Ms. Brown says, sipping a GBP 3.30 ($5.78) caramel frappuccino. "I tried to get my mum to come, but she told me I was crazy to waste my money this way."