China's coffee market has entered the fast lane of development

Reporter Wang Jinchen

With the continuous expansion of coffee consumers, China's coffee market has entered a stage of rapid development, and new enterprises emerging are promoting the industry to present product category diversification, brand localization and marketing online and offline integration, and the market scale continues to grow
.
Throughout the development of China's coffee market, it has gone through the change from new experience, social experience, diversified consumption scenes, to today's quality consumption stage
.
In the past two years, local coffee brands have risen rapidly, new brands have emerged in the coffee track, innovation has emerged, and the competition in the entire industry has become more and more fierce
.

Iterative upgrades at both ends of supply and demand

In China's coffee market, instant coffee is still the mainstream, but the proportion of freshly ground coffee continues to increase
.
Freshly ground coffee in major countries such as the United States and Japan accounts for the main body of the market, while China's market is still dominated by instant coffee
.
With the gradual penetration of coffee culture and the development of supply-side chain coffee brands, the proportion of freshly ground coffee in the domestic market continues to increase, rising by 21.
5% from 2017 to 2020, and freshly ground coffee will contribute to China's coffee market in the future
.

Tianyan inspection data shows that up to now, there are more than 170,000 coffee-related enterprises in China, of which more than 23,000 are newly registered related enterprises in 2021, and the growth rate of newly registered related enterprises has reached 18.
9%; From the perspective of geographical distribution, the number of related enterprises in Guangdong, Yunnan and Jiangsu ranks first, with more than 34,000, more than 16,000 and more than 11,000 respectively; from the perspective of establishment time, 42.
2% of related enterprises were established within 1-5 years, 18.
8% of enterprises established within 1 year, and 10.
9%
of enterprises established more than 10 years.

From instant coffee to freshly ground coffee, with the continuous enrichment of product categories, and then to the "iterative upgrading" of consumers themselves, the understanding of coffee continues to deepen, coupled with the continuous efforts of both ends of supply, China's coffee market has gradually entered the fast lane of development, and consumption upgrading has driven new demand
for coffee.
As an optional consumer good, economic growth, the increase in disposable income of residents, and consumption upgrading are the basic plates
that cannot be separated from the rise of the coffee industry.
To a certain extent, consumption upgrading represents the upgrading of residents' life concepts and the yearning
for a better life.
The attributes and characteristics of coffee coincide with the new consumption needs of the people, such as the spiritual needs of self-pleasing and extensive social needs
.
The change of consumption concept between generations is greatly related
to their growth environment.
The post-90s and post-00s generation grew up in the Internet era, they pursue individuality and quality, have a higher preference for "self-pleasing" consumption, and have a higher
acceptance of new things.

The variety of products is becoming more and more abundant

The rise of the Internet coffee model
.
The "marriage" of coffee and the Internet has added more possibilities
for the development of the coffee industry.

Prices are downward Small shop model rent, decoration costs are reduced, ensuring profit margins, and lower prices
.
Most of the typical Internet cafes are located in key business districts and office buildings, focusing on take-out, and the space and labor are basically the ultimate "cost performance", so that the price of products has a large room
for decline.

Diversified consumption scenarios Office buildings, gas stations, university campuses, airports, stations and other places have become the second growth curve of the coffee market, due to the particularity of its geographical location and the characteristics of the personnel structure, whether it is a rapid response to the needs of white-collar workers or the price priority of students, coffee can be better satisfied
.
Another factor that cannot be ignored is takeaway, Internet coffee makes takeaway and self-pickup effectively expand the service radius of a single store, and enhance the imagination
of the service scene.
To a certain extent, takeaway breaks the limitations of space and time, allowing consumers who love coffee to enjoy delicious coffee
anytime, anywhere.

Convenience and speed become the theme of consumption The wide application of Mini Programs effectively realizes online ordering and offline self-pickup, stimulating the convenience demand
in fast-paced life.
The click-and-go form of consumption is also suitable for migrant workers at work, for many "lazy star people"
.
Place an order on the way to work and pick it up at the store, so that migrant workers can drink delicious coffee without delaying their work time, killing two birds with one stone
.

Cross-border players emerge endlessly Michelle Ice City established LuckyCup lucky coffee, launched a new product "Coconut Ice Extract", the national stores were launched simultaneously, CoCo can tea drink to establish a new coffee brand CoCocafe, Chayan Yueshi newly launched coffee brand "Yuanyang Coffee", focusing on new Chinese coffee, and many crossover players such as Post Coffee and Li Ning's NINGCOFFEE entered the coffee market
.

Synergistic development of freshly ground coffee and instant coffee In the memory of many people, coffee is synonymous with bitterness, because the quality of coffee beans is poor, and the high-temperature process of spray drying is easy to lose aromatic substances, making the aroma insufficient
.
With the advancement of technology, boutique instant coffee represented by capsule coffee began to occupy the minds of users
.
Fine instant coffee, select high-quality coffee beans, using freeze-drying technology and coffee liquid concentration technology, so that the taste and aroma are closer to freshly ground coffee, and the fusion speed is fast, easy to preserve, and some boutique instant brands have also launched hanging ear coffee
.

Multiple categories to choose from When experiential consumption evolves into everyday consumption, consumers will begin to consider price and convenience
.
For consumers, the pursuit of cost-effectiveness is the eternal theme when choosing to buy products, and different groups of people have different demands
for the price elasticity and convenience of coffee.
Both freshly ground coffee and instant coffee on the market today offer different types of coffee for consumers to choose from
.

The hot coffee market has a lot to do with
the boost of venture capital behind it.
After the rise of new consumption after a wave of "random flowers and gradually charming eyes", the coffee track slowly won and was favored
by investors.

In terms of financing event areas, Shanghai, Beijing, Guangdong and Hunan, these four places lead the rest of the country in the number of coffee financing events, of which Shanghai ranks first
with 55.
According to data from Meituan's "2022 China Coffee Consumption Insight Report", as of the first half of this year, there were 7,857 cafes in Shanghai, 3.
16 cafes per 10,000 people in Shanghai, and an average of 1.
3 cafes per square kilometer, making it the city
with the largest number of cafes in the world.
At the same time, domestic local high-quality coffee brands such as Manner, Nova Coffee, MStand, and Seesaw all originated in Shanghai and gradually went nationwide
.

The only way to grow

From the traditional sense of drink, to the brand building of the enterprise, coffee finally forms a coffee culture that the public can participate in, which is the only way
for a product to develop and grow.

From the development of the Japanese coffee market can be seen, from the opening of the first café in Tokyo in 1888, from the highly dense vending machine to the canned coffee to bring convenient consumption mode, to canned coffee can no longer meet its demand for quality improvement, to specialty coffee and freshly ground convenience store coffee to drive the further development of the Japanese coffee market, providing an idea
for the development of China's coffee market.

Since 2019, China's per capita GDP has exceeded 10,000 US dollars, the per capita GDP increase and consumption upgrading have prompted people to pursue high-quality and personalized consumption methods, coffee imports have ushered in rapid growth, and the convenience of self-service vending machines has accelerated the penetration
of coffee culture.

China has entered the era of consumption upgrading, the Internet and takeaway have improved the convenience of coffee, with the rise of the economy, China's coffee market will usher in a period
of rapid development.

Tianyancha Research Institute believes that coffee, as an "imported product", has completed the transformation from personalized to popular, and gradually penetrated into people's lifestyles, and the functionality and sociality are becoming more and more prominent
.
The high frequency, high repurchase and high addiction characteristics of coffee are also important reasons why brands are eager to create economies of scale, and when drinking coffee becomes the choice of many consumers, coffee shops may be as
ubiquitous as convenience stores.

China Food News(November 28, 2022, Version 07)

(Responsible editor: Wang Jiayi)