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October 13, 2020 | Business Success

Smith Tea: Becoming an E-commerce Business Overnight

When COVID-19 hit, Smith Tea knew it was time to act

Portland-based Smith Teamaker had built a successful business delivering high-quality tea and beverage products to restaurants, hotels and retailers across the country. More than 90% of that business dried up almost immediately when the pandemic hit, leaving the company without its primary distribution channels to sell and deliver its products. 

 

Pivoting business strategy

With COVID-19 spreading, consumers were forced to stay at home with heightened concerns about the health and safety of their families. With most of its product available in restaurants and hotels, Smith had to reconfigure its business model to provide product where consumers could access it.  

While people were not dining out, going to offices and visiting grocery stores as much, they continued shopping online more than ever. For Smith Tea, the key to getting through the tough economy depended on it not just crafting world class products but developing a direct-to-consumer e-commerce engine that delivered products to customer homes.

Rapidly evolving into a direct-to-consumer business required a 180-degree pivot in strategy and a more sophisticated online presence and e-commerce platform to make it happen. Reducing costs in certain areas to invest in greater digital capabilities was critical.

 

Adopting a new sales and marketing model

Sales efforts moved from in-person conversations with distributors to digital media targeting customers online and nurturing them to point of sale and payment in an entirely digital environment.

This required not only optimizing their online storefront, digital content and performance marketing efforts, but also meant shifting dormant resources to production and distribution where new demand was highest. At the transaction level, the company needed to work with its bank to implement an automated, seamless payment system to support its new strategy.

 

Delivering new products and changing pricing model  

Selling directly to customers also opened up opportunities to explore new and different products to accommodate consumer tastes and demands, as well to compete in a much more option-driven environment. In the spring, Smith launched a new iced tea collection that quickly became its most successful product launch in history.

In fall of 2020, Smith will launch a new organic wellness collection intended to serve the health needs of a pandemic during flu season.  

While the pandemic forced Smith Tea to completely re-think its go-forward strategy and pivot quickly to survive, the results have been remarkable—20% growth month-over-month, 30,00 new customers, and a stronger market position than before the pandemic. In fact, 90% of new customers are outside the Pacific Northwest.

Smith Tea is just one example of how businesses across the country are rising to the moment and showing resiliency in the face of unprecedent disruption.