2020 coffee industry summary report and 2021 coffee industry trends outlook
The difficult 2020 will soon be over. Although it is difficult, the road still has to go on. Although it has experienced turbulence, it has recovered steadily. In this year-end summary, follow me to review some major events in the coffee industry in 2020 and analyze the future development direction of China's coffee market.
01 Review of major events in China's coffee market
The coffee market in 2020 can be said to be ups and downs, "tragic". Many cafes were forced to close permanently in the first half of 2020. So for the coffee shop, the most cutting-edge coffee industry, there are also continuous events.
The death of domestic brands
In April, Luckin Coffee, which had exploded in its development momentum, was exposed to 2.2 billion financial frauds, resulting in stock delisting, 1,000+ stores closed, and high fines. However, Luckin's operation in the second half of the year was not affected much, and it continued to introduce new ones, and sales were also good. It is reported that most of the stores are already profitable.
Another thing to talk about is "Lian Coffee", a cafe that developed a small shop + delivery model earlier than Luckin Coffee. At the end of 2019, stores began to close gradually, and it was not revealed that offline stores would be fully closed until the first quarter of 2020.
On September 2nd, the official news reappeared and the online channel was fully laid out and started again. From this point of view, it seems that coffee shops have always been a thankless downstream industry.
Although there is a lot of unfortunate news, there are also many good news. For example, Manner Coffee, which started from a small store of 3 square meters in Shanghai, has developed smoothly and blossomed everywhere. On December 20, the B round of financing was successful, with a post-investment valuation of US$1 billion.
2020 rivals continue to leverage
Starbucks, an old guy, has developed smoothly in China. Although Luckin's initial development was squandered, he quickly made a response strategy and opened a "brown fast" store to be a small store + delivery form . Although the hometown of the United States has closed 400+ stores due to the epidemic, it does not prevent the continued opening of stores in China. It is expected that in 2021, China will also be the largest contributor to Starbucks' growth!
In addition, Starbucks Coffee’ old rival, COSTA COFFEE, has begun to close its stores on a large scale because everyone understands but cannot explain it clearly. Qingdao no longer has a store. Not only that, COSTA has also closed a number of stores in Beijing, Hangzhou, Nanjing and other places. According to the market, the number of stores closed this time exceeds 10% of the total number of stores in the Chinese market.
Fast food giants KFC and McDonald's have not given up coffee. Owning a large number of stores, one more coffee, naturally, the price is obviously much more competitive with other stores. KFC's actions are undoubtedly the smallest, but the coffee machine is added and Arabica beans are used instead, and the price is not expensive. But what's more ruthless is that a monthly coffee card was introduced. It only costs 28 yuan to apply for the card. Within a month, you can drink a cup of freshly ground coffee for only one yuan a day.
McDonald's restarted the layout of the Mc Cafe brand, and the overall VI was upgraded. On November 16, McDonald’s coffee brand McDonald's announced that it will invest 2.5 billion yuan in the next three years to accelerate its deployment in the mainland coffee market. It is estimated that by 2023, there will be more than 4000 wheat coffee shops nationwide.
Foreign brands continue to be optimistic
2020 has also witnessed the development potential of international coffee chain brands in the Chinese market, including Peets Coffee, Tim Hortons, %Arabica and other brands that continue to accelerate their investment in China.
One of the most noteworthy is Tim Hortons. Tims China has obtained Tencent's exclusive strategic investment with an amount of more than 100 million yuan. Tencent holds a certain amount of shares in Tims China. After obtaining this round of financing, Tims China will accelerate the opening of stores in the Chinese market and continue to explore digital channels such as WeChat applets.
02 Analysis of China's Coffee Market
Although the overall per capita consumption of China's coffee market does not seem to be large, the growth momentum of consumption is obvious to all, with huge potential. The International Coffee Organization predicts that China's coffee consumption will increase to 300 billion yuan in 2020. Tu Weicheng, head of the Tmall coffee industry, said: "According to the data on the Tmall platform, the total coffee sales have increased by 80% every year, which is in line with the strong momentum of the past few years.
Instant melt is still the mainstream
Although all kinds of Internet celebrity stores and chain stores are in full swing, it seems that the coffee market is beginning to recover and flourish. But in fact, when Chinese people consume coffee, instant coffee still accounts for more than half, reaching 63%. Therefore, the instant coffee market should not be underestimated.
Therefore, new online brands such as Shicui, Yingji and Sandunban start from new technologies and new tastes. It not only improves the quality and taste of traditional coffee, but also allows instant coffee to no longer rely solely on hot water, and is more adaptable to people's different scenarios.
In the subsequent coffee market, this diversification and segmentation of coffee products will also be a new force.
Coffee will eventually become ordinary
Although coffee is an exotic product in China, it has increased its value when it comes, but after so many years of market exploration, as one of the three oldest and most traditional beverages, it will eventually return to its normal value.
Although the current high price of coffee is affected by many factors, such as high rent and labor. But it will still return to ordinary. The emergence of Manner Coffee is a good phenomenon, which proves that low price can also be of outstanding quality, and it is not unattainable.
I always believe that if you want the coffee industry to have long-term development, you must expand the audience. The most direct and effective way to expand the audience is to make it available to everyone.
China's Yunnan coffee acceptance gradually increases
As the largest coffee producing area in China, Yunnan has experienced a blowout development in recent years, which means it has accumulated a lot. A closed loop of the coffee industry centered on coffee planting, harvesting, processing, roasting, and sales has gradually formed. The quality of green coffee beans has improved year by year, and different processing methods have also brought coffee flavors with Chinese characteristics to the market.
According to my own experience, the acceptance of Yunnan coffee has been greatly improved. Chinese people have a certain understanding of Yunnan coffee and are willing to accept and taste Yunnan specialty coffee. The quality has been well received by customers!
Yunnan coffee is also gradually getting rid of the synonymous with low-end and low-quality.
Through industrial development, the future of Yunnan coffee in various Yunnan green bean competitions and roasting competitions can be expected. The future is unlimited!
The new trend of cafes, the current coffee market, the development direction of cafes, the data obtained from personal statistics, roughly divided into three directions:
1. Internet celebrities and community stores based on small stores:
The Internet celebrities here are not in the traditional sense because of a certain cool decoration and cool equipment, but the kind of surface Internet celebrity shops that produce problems. But from decoration to equipment, to production, and then to a NICE store. This type of store is usually not large in size and is opened in old neighborhoods or some special places. The decoration is very character, the proportion of the shop is better, the products are very ornamental (with the value of taking pictures), and more demonstrate the perseverance and philosophy of the owner in coffee, such as the coffee supply and marketing cooperative in Shanghai.
2. A shop focusing on specialty coffee
All drinks contain coffee, but not pure coffee!
Through the fusion of different raw materials and coffee, a new beverage concept is burst out, and it becomes a new beverage with more creative, diverse flavors and rich layers. This will help the Chinese to open the door of coffee tasting and make it more acceptable to the Chinese taste buds! This type of more typical is Berry beans from Shanghai O.P.S and Beijing Sanlitun.
3. Self-baking cafe:
The characteristics of self-roasting cafes are very distinctive. The owner himself roasts the coffee beans needed for daily operations in the shop. From Italian blends to specialty coffee, they are roasted by themselves.
This kind of store is more pure, the coffee varieties are changed from time to time, and there are many different styles of beans to choose from.
In terms of service, most of the managers themselves or the clerk trained by the manager meticulously and patiently recommends and explains the characteristics of each bean, and the flavor helps customers understand the coffee and find the most suitable one. Because the beans are baked at home, I have a deeper understanding of beans. If you have the pursuit of coffee quality and want to drink some unusual beans, you can go to these restaurants, and there may be surprises.
4. Brand Experience Store
Many coffee brands started online, such as Shicui, Three and a half, Yingji and so on. After being successful online, you need to switch to the line to implement the brand. You can get closer to customers. It is also part of the extension of brand marketing, and those who are curious may wish to take a look
03 Analysis of the future development of the coffee market: In the future, China's coffee market personally feels that there will be five changes from the consumer side.
Variation 1: Miniaturization of cafes
I personally think that the cafe will develop in the later stages of miniaturization, commercialization, and cross-border integration. The reason for this speculation is mainly because of several aspects of coffee:
1. On the premise of retaining social functions. Reduce costs as much as possible. The biggest cost at present is rent and labor. Reducing the rent can control costs more effectively and improve their profits.
2. The community is the smallest social unit in contact with people. If there is such a warm and interesting little place at the door of the house, would it be more beautiful to meet a few friends, sit down, and chat?
3. Cross-border integration is another trend. The purpose is also to reduce costs, and more people are starting to do this. The future is a good direction.
Change 2: Instant coffee will continue to lead: Instant coffee will continue to lead the coffee market in the future.
Instant coffee is a product that cannot be ignored. Because it is more in line with people's fast-paced life needs. Compared with freshly ground coffee, the cost is lower, but the quality is higher than traditional instant coffee, and the cost per cup is not very expensive. Easy to brew, cold or hot water is fine. This solves the need for a large number of people who need to go out or who are short of time to get a cup of coffee quickly. The future of instant coffee should be developed towards better quality, richer flavor and more convenient brewing.
Three Changes: specialty coffee catching up
In terms of coffee consumption, milk coffee is still the mainstream of Chinese people, but users will evolve.
After drinking all kinds of milk coffee, I began to pursue the essence of coffee. This is its most original taste, and specialty coffee satisfies this requirement.
Different origins, different processing methods, and different roasting degrees will bring different flavors to the coffee beans. Through the right brewing method, a cup of black coffee with rich layers and solid taste and charming aroma is presented. "Pureness" should be the last pursuit of mankind!
Change 4: The blowout of ready-to-drink coffee
As a ready-to-drink coffee between instant coffee and freshly ground coffee, it not only satisfies the convenience of coffee, but also has a price lower than freshly ground coffee, attracting dairy giants and beverage giants to set foot in the coffee field. Coca-Cola has joined Costa and Nongfu Spring I produced a series of hanging ear coffee and instant coffee. Traditional beverage industries such as Pepsi and Want Want join in the back.
In the future, ready-to-drink coffee products should be upgraded in product materials. Milk-based coffee beverages should reduce the use of milk powder, through technological innovation, the use of cow milk, oat milk, and reduce the use of additives and other preparations, so that healthy raw materials can enter the lives of consumers.
Change 5: The coffee industry in the era of big data
In the era of big data, 5G has gradually matured and computing power has increased. Big data can bring qualitative changes to the coffee industry!
Through the smart coffee robot, the automatic coffee vending machine presented can produce drinks that are not inferior to professional baristas at a lower cost. By collecting user payment data, users can analyze user preferences and provide consumers with their favorite products Reduce research and development costs and improve efficiency.
In the data age, everything is waiting for us to discover!
I am personally optimistic about the development prospects of coffee in China. No matter where you start from the industrial chain, there are definitely many things you can do in the future. As long as you grasp the segmented areas and fully analyze the user's pain points, you can always find the point that can be done. The future coffee market is full of endless possibilities. As a coffee man, cheer and cheer for yourself. Also cheer for you who are coffee people!