South Korean media: Starbucks' market share in China drops to 14%, local brands rise strongly!

On December 12, the South Korean media outlet "NEWSPIM" published an article stating that Starbucks opened its first store in China in 1999 and quickly expanded, growing the Chinese coffee market. Currently, Starbucks has 8,000 stores in China, accounting for about 8% of its global sales.

However, the company is currently facing significant challenges in its business in China. Its market share has dropped from 34% in 2019 to 14% in 2024.

In particular, during the pandemic, as the Chinese coffee market shifted toward online ordering, delivery, and takeout models centered around local companies, Starbucks suffered particularly severe losses due to its failure to respond to the changing market environment.

Especially brands like Luckin Coffee, which have rapidly risen in recent years, have expanded their market share by offering low prices and a variety of options, putting pressure on Starbucks' sales in China.

Currently, a cup of latte at Starbucks in China costs more than 30 RMB. In contrast, local brands such as Luckin Coffee sell their lattes for about 10 RMB.

Analysis shows that the frugal consumption trends of the younger generation, the main consumer group for coffee in China, have exacerbated the weakness in Starbucks' sales, and its high pricing strategy has kept sales低迷. Young consumers are beginning to give up Starbucks coffee because it is about three times the price of domestic coffee.

Ultimately, Starbucks sold 60% of its Chinese business to Boyu Capital. With the transfer of management control, Starbucks' business strategy in China is expected to face greater challenges.

At the same time, China's leading coffee brand Luckin Coffee is seizing this opportunity and showing a firm determination to expand its market share. Industry experts say that Luckin Coffee may even consider listing on the NASDAQ when the timing is right.

Luckin Coffee opened its first store in October 2017 and quickly rose as a dark horse in the Chinese coffee market. Despite starting later, Luckin Coffee has experienced explosive growth, posing a threat to Starbucks.

Original article: toutiao.com/article/1851265418151940/

Statement: This article represents the views of the author himself.