Has the Korean brand Man Coffee really slowed down now that it used to expand rapidly?

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In October 2017, Luckin Coffee made a high-profile appearance in the public view with 1 billion capital. The strong rise in 2018 set off waves in the entire coffee market and attracted great attention. Even Starbucks, which has been in China for 20 years, made many strategic adjustments in 2018.

In terms of China's coffee consumption, China's coffee market consumption grew steadily from 2014 to 2017, according to the China Business Industry Research Institute. The total coffee consumption in 2014 was 20.7714 million tons, an increase of 34 percent over the same period last year; in 2017, the total consumption was 34.8095 million tons, an increase of 29 percent over the same period last year. It is estimated that China's coffee consumption will exceed 35 million tons in 2018. In this context, the number of coffee shops in China is growing rapidly: from about 15906 in 2007 to 31794 in 2012 and about 140000 in 2018.

The great potential and high profits of China's coffee market have attracted many foreign brands to lay out China. Coffee is one of them.

The period of rapid expansion of diffuse coffee

As early as 2011, South Korean businessman Xin Zixiang saw the blue sea market of Chinese coffee and set up the first store of Man Coffee in Beijing.

Man Coffee is a relatively early Korean coffee brand in China. Its founder Xin Zixiang once said that Man Coffee is not a simple place to drink coffee, but also a place for parties, activities, leisure and conversation. He wants to make Man Coffee the fourth activity place for Chinese consumers besides homes, units and restaurants.

The early expansion of diffuse coffee developed rapidly. According to online data, in two years, Man Coffee has more than 110 stores in Chinese mainland area, with an average annual growth rate of 55 stores. Different from the formal style of the American coffee shop, the Korean style environment, leisure and spacious space, retro design, gorgeous furnishings, exquisite objects, all make people feel relaxed, natural and comfortable. The space and design of coffee are designed to create an atmosphere of human interaction for consumers.

Coffee is also different from other cafes. Its area is relatively large, in addition to suitable for small-scale communication and chat, but also suitable for many student gatherings, dinners and other activities with a large number of people. The decoration of all the chain stores of Man Coffee is copied uniformly, and the style of all stores is roughly the same. Korean amorous feelings can be seen everywhere and the romance of Korean TV dramas.

Xin Zixiang said publicly in an interview that the reason for the design and layout of Man Coffee comes from the observation of the Chinese people. Chinese people like to get together with friends and family, eat and chat, all need a "space" to meet. This space needs to have a certain atmosphere, so that everyone can get together to feel relaxed and relaxed. The purpose of diffuse coffee is to make this space.

When the reporter browsed the comments on the diffuse coffee from Dianping, people would more often say that the diffuse coffee environment is very comfortable, the music is very suitable, and the bear furnishings are very cute.

Man Coffee is particularly keen to use stars or public events to shape and market its own brand image. On their official WeChat account, they often post photos of Sun Honglei, Liu Kaiwei, Tan Songyun and many other stars with coffee. This star effect gives consumers a strong psychological hint that where the stars like to go and where they like to take pictures, do you want to come?

To a certain extent, from the point of view of the creation of the "fourth space" of diffuse coffee, diffuse coffee is successful. People remember the space environment of diffuse coffee, remember the "cozy" of diffuse coffee, and it is very recognized.

The competition in the coffee market is white-hot, can diffuse coffee still get up "fast"?

As more coffee brands enter China, the sales channels and brand distribution of coffee become more detailed. According to the data compiled by the prospective Industrial Research Institute, it is found that from the perspective of the main sales channels and brand distribution of China's coffee market, there are two major categories:

Instant coffee: the main consumption channels include specialty stores, imported supermarkets, as well as large supermarkets and shopping malls, covering brands such as Starbucks, Yushi, Grant, Nestl é, Maxwell, Hougu Coffee, Cloud Coffee, etc. According to statistics, instant coffee accounts for 84% of the market share, and the market share of freshly ground coffee, which is more in line with the trend of consumption upgrading, will be increased in the future.

Freshly ground coffee: consumption scenes are mainly in homes, offices and cafes, covering high-end brands such as Warren Finn, Youshi, gourmet Blue Mountain Coffee and Coffee Town, Yuncaf, Nestl é and so on. Among them, the main brands of coffee grinding in cafes are Starbucks, Man Coffee, Shangdao, Dior, both sides of the Strait, Pacific (2.560, 0.10,4.07%) and so on. According to statistics, the market share of freshly ground coffee is only about 16%.

As more and more people see the great potential of the Chinese coffee market, more foreign coffee brands have entered the Chinese market, and the strong rise of domestic coffee brands has made the freshly ground coffee market, which already has a small share, become more crowded, and the expansion of diffuse coffee has become so slow. So far, there have been 150 stores, an increase of 40 in five years, which is clearly a slow pace compared with the early rapid expansion, according to the official Wechat. In early 2017, Man Coffee also closed two stores that had opened in Suzhou in 2014 and 2015.

After several years of development, the barrier of diffuse coffee has been increasingly worn away. There are more and more coffee shops with different styles and themes, such as "traditional Chinese Cafe" to meet the reading needs, "Lumiere Cafe" on the film theme, "Cat fans Forest Cafe" to meet the needs of pet lovers to pet cats, and so on. These cafes can meet people's needs for different spaces. Korean-style coffee has become more "ordinary", not so unique.

In addition, the more subdivision of coffee categories and the increase of brands, the diffuse coffee is full of fierce competition. There are many well-known brands in the coffee market in 2018, such as Starbucks, Coast, Pacific Coffee, etc.; self-service coffee equipment include coffee bar, friend coffee, small coffee, etc.; convenience store coffee has 7-COFFEE, guest coffee, etc.; foreign coffee brands have entered the Chinese market, such as Doutor Coffee of Japan, Tim Hortons of Canada, and Internet coffee Luckin Coffee, even coffee.

Coffee is being accepted by more and more consumers, but if coffee does not try to give more and more solid definitions to its products on the basis of its original advantages, it may become powerless in the face of increasingly fierce competition in the coffee market.