The Rise of Coffee in China

China is known the world over as a tea-drinking country. This is rapidly changing as young and wealthier consumers adopt coffee-drinking culture. Today 52% of the population enjoys coffee. 

There are three groups of coffee consumers in China: 

1) those who go to coffee shops for business meetings

2) those who go to socialize—generally middle-aged women and younger generations

3) young couples who see coffee shops as great places to go on dates.

According to the International Coffee Organization, young middle-class consumers account for 75 percent of coffee drinkers in China with 70 percent of these being women. Much like coffee shops abroad, also offering tea, pastries and Wi-Fi are important to most customers. 

The number of Starbucks stores in China is expected to surpass those in the US in the coming years. The coffee giant plans to double the number of stores it has in the country to a whopping 6,600.  In China coffee consumption is growing by 30% annually, putting it 2% above the global average.

The Products

Interest in specialty coffee is growing quickly in China as consumers seek higher quality beverages. Milk-based coffees are the most popular, such as lattes and cappuccinos. Coffee mixed with healthier ingredients and non-dairy substitutes(e.g. oat milk) is also attracting consumer’s interest. In Chine convenience is king. 52% of consumers buy coffee at convenience stores while 44% consume at a coffee house.

The Future

With strong annual consumption growth and a rapidly growing specialty scene, the Chinese coffee market presents a once-in-a-generation opportunity for ambitious coffee brands.  

Adapting to China’s cultural traditions and preferences are key to success in the market. These include China’s use of technology for food and beverage delivery, local tastes, digital media, and connecting with trusted businesses. Brands that do this are sure to enjoy strong growth in the Chinese coffee market for years to come.

How to Succeed

Ensuring that flavors and quality meet expectations, while targeting the correct local market and consumers certainly adds to the chance of success. Mersol & Luo has been guiding beverage manufactures for the last 6 years through extremely challenging and ever changing environments in the Greater Chinese markets. 

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