@AC - You raise some valid points. The long term value and impact of this concept is uncertain, but it is certainly a bit outside of the box for most tea retailers and worth trying.
Custom Blends accounted for a little over 5% of Adagio's online tea sales in the past year. Not a tremendous amount, but not insignificant by any means. I would think that blending in-store will be much more popular than online since you will be able to actually see and smell the teas rather than just guessing at ratios.
I agree that blending will appeal primarily to existing customers. That said, if we can keep people in the store "playing" with tea, the impression on new tea drinkers or the casual observer will be huge. I don't want tea to be the stuffy, esoteric product it appears to be in many premium specialty tea shops. We'll have the really good stuff too, but those who prefer flavored and fanciful tea blends will be attracted to the custom process.
At the end of the day, the number of people who take advantage of the service is less important than the impression that the offering makes. Shula's Steak House offers a 64 ounce porterhouse. I've never seen anyone order or eat it, but I've heard more people talking about that ridiculous cut of meat than any other plate at any other steak house.