"Family, who knows? Monday is Luckin, Tuesday is Nayuki, Wednesday is Chamomodo, Thursday is Kudi, Friday is ancient tea, and Saturday is Coco. At 9 yuan, I can't finish it!"
Following the coffee 9.9 war, tea drinkers are also accelerating the "Mixue Ice City" this year, and 9.9 has become a trend. As Chamomodo, Coco, Nayuki's Tea and other brands play out 9.9 in more ways, there are more and more similar "exclamations" on social media such as Xiaohongshu and Douyin. Some consumers even calculated their economic calculations: a cup of coffee or milk tea at 9.90 a day costs only more than 3,000 365 days a year, and the joy of harvesting wool is enough to last a whole year.
You let me enjoy the benefits, and I see brands and consumers running in both directions. September is coming to an end, and we can predict that many 9.9 "welfare" launched under the guise of activities will obviously not end here.
However, under the heat brought by all-round low prices, industry problems may become more obvious. In an article analyzing the current 9.9 business war in the tea beverage industry, a tea beverage brand franchisee said that these brands are engaging in price wars, but they are putting pressure on franchisees. At the same time, judging from the new launches of various brands this year, it is obvious that beverage formulas have reached a bottleneck period. Many new seasonal varieties have no effective popularity, resulting in most single products being squeezed into a narrow price range. The tea industry cares more about "capital preservation" than innovation.
They are all 9.9. To replicate the success of Luckin 9.9, the tea industry faces considerable pressure.
The simplest business war only requires a price war of 9.9
Everyone has a cup of Ruixing with a score of 9.9, and milk tea with a score of 9.9 is still trying to come up with new ideas.
After Heytea opened to franchise, "Drink Heytea for 9 yuan" has almost become a permanent means of attracting traffic to new store openings. At the end of August, "Drink Naixue fresh milk tea for 9.9 yuan every week" became the new slogan of Naixue's business, and the order volume quickly increased in a short period of time. In September, Chamomodo launched the "limited time" event of "Drink Real Milk Tea on 9.9", and the category directly met Nayuki.
In addition, a series of well-known and well-established brands such as Gu Ming, Happy Sweet Potato, Coco, Hushang Auntie, Bawang Tea Girl, Lemon Tea Hill Uncle, etc., have all lowered their product prices.
This is undoubtedly inspired by the idea of Coffee 9.9. Luckin’s 9.9 strategy led to significant growth in store consumption and performance in the second quarter, especially the average number of monthly transaction customers in the second quarter reached 43.1 million, an increase of 107.9% over last year. For a 9.9 cup experience, consumers are willing to go to the store.
The difference is that in the coffee industry, consumers will feel that with an average price of 20 yuan, 9.9 coffee is very cost-effective because Starbucks serves as a psychological price anchor. But on the milk tea track, with price killers such as Mixue Bingcheng leading the way, 9.9 can only rely on the value of raw materials such as fresh milk or brand effects to reflect its value. Therefore, how to bring more value to 9.9 is the focus of tea brand exploration.
It is not difficult to find that in this round of 9.9 movement, it is the pursuit of many players to combine 9.9 with the community and private domain, squeeze the attractiveness of the price as much as possible, and attract traffic to drive the comprehensive construction of the brand. Typical examples include Nayuki's tea, Cha Baidao, Gu Ming, Bawang Cha Ji, etc.
Take Bawang Cha Ji’s 9.9 original leaf fresh milk tea coupon as an example. After it is distributed in the community, it is required to dine in and use it through the brand mini program within 24 hours. It not only drives the customer flow of offline stores, but also shortens the time for consumers to dine in. The exchange and fulfillment link avoids the mentality of hoarding goods and makes buying now a habit. In addition, to receive coupons on 9.9, you often need to register as a brand member, instead of being able to collect coupons anonymously through live broadcast channels like some coffee brands.
In fact, the 9.9 in-store verification also takes into account consumer thinking. After taking delivery fees and other miscellaneous items into account, the pricing of traditional tea drinks often stays in the range of 10 yuan to 15 yuan. Compared with the single-digit pricing of 9.9, it often gives people the feeling that one cup a day is on the high side - Consumers You will unconsciously compare it with the price of bottled drinks and the price of a meal.
But after the price reaches 9.9, it is easy for consumers to develop a habit by going to the store for verification: the price is not expensive anyway, just have a cup on the way to school and work. In some comments, we can also find the reversal effect of this price anchor on consumption habits. 9.9 is enough to turn any drink into a part of daily drinks, and Luckin has therefore become the "ration" for urban workers.
Even so, not all players on the coffee circuit agree with the concept of civilian consumption. Li Dong, CFO of Tims Tianhao China, once pointed out: "If the price of coffee is around 10 yuan, consumers will not think that it is a professional or high-quality coffee." In the eyes of this type of players, long-term low prices do not mean It is not conducive to the sustainable development of the brand.
In the same way, coffee itself, as a core category, still has a lot of room for theoretical growth in the Chinese market, and differences still exist. Tea drinks have long been in a head-to-head situation. From milk tea to lemon tea to fruit and vegetable tea, and even light wine tea, no matter how many 9.9 there are, they cannot conceal the homogenization trend of beverage formulas. Whether 9.9 is a blessing or a curse is yet to be determined. .
Although the leading tea drink brands can also forcibly join the 9.9 business war with the blessing of scale effect, Luckin can still come up with products such as sauce latte and tea coffee with high unit price per customer outside of 9.9, and for some teas For beverage brands, after 9.9, there may be no way out.
The supply chain is highly homogeneous, and beverages are "forced" to innovate amid internal disruption.
The Meituan New Catering Research Institute recently released a set of data. In the first half of this year, 15 of the top 20 new tea products sold on the Meituan takeout platform were fruit teas. Peaches, watermelons and other fruits, with a different combination and a different name, have gone from popular products of Cha Baidao and Gu Ming to the main products of Mixue Bingcheng.
This aspect is naturally a consumer choice, and the adaptability to traditional fruit flavors affects mass consumption choices. But on the other hand, for tea brands that value innovation and are eager to continue to launch hot products, this makes them worry about homogeneity.
It’s not just fruits. If we classify according to the beverage ingredients and production methods in the development process of tea drinks, the tea drink industry has roughly gone through three stages of development - the 1.0 milk tea era of creamer blending, and the "milk + tea + toppings" era. 2.0 beverage era, and the new tea drinking era of “tea + milk + fruit”. More and more brands are also beginning to use some alcoholic beverages and natural plant ingredients as their base.
However, the way to play with raw materials itself is subject to multi-dimensional restrictions. On the one hand, niche raw materials such as mandarin oranges in the past two years and mulberries last year have small traditional channels and limited production capacity. Even if hot products appear in a short period of time, they cannot meet the needs of all tea brands. It will take time to adjust production capacity and Allocation adjustments.
On the other hand, not every innovation attempt will be successful: last year, Heytea, Naixue's Tea and Lele Tea all bet on Guava, but the market response was mediocre, and their attempts came to an end before midsummer. But this year, Yangmei has successfully won the "sales crown" in summer, and tea brands can only continue to chase hot spots. On the source supply chain side, there is more or less communication between brands, or market trends are speculated through procurement status, which in turn amplifies the defects of homogeneity.
Therefore, why are tea drink brands also keen on IP co-branding and 9.9 price wars? Because compared to the uncertainty of innovation, the existing comfortable path has a higher probability of success, even if it is not safe in the long run.
Red Meal big data shows that from 2015 to 2022, the size of my country's current tea market has grown from 42.2 billion yuan to 142.3 billion yuan, but the market size in 2022 will only increase by 0.3% month-on-month, less than 500 million yuan. On the other hand, the new tea drink craze started by beverage brands such as Oriental Leaf and Yuanqi Forest are also using similar concepts and ingredients to compete for the living space of freshly made tea drinks.
In this context, tea brands have to demonstrate their value from every possible place. For example, in order to improve the image of their products when the raw materials are homogeneous, some brands will additionally refine their marketing language from the origin of raw materials, production techniques, etc., in an attempt to put a cultural brand on the products. For example, the oolong tea series Phoenix Dancong, which is a common raw material, will be given additional concepts such as a fresh environment at an altitude of 1,500 meters and single-plant tea supply. But in fact, Phoenix Dancong is named "Dan" because it is originally "picked per plant, made tea per plant, and sold per plant", and it will not be special because of brand differences.
Obviously, after "tea + milk + fruit + wine + culture" has been used so often, it is becoming increasingly difficult for tea drinkers who once boasted that there are hundreds of trial and error experiences behind a new product to innovate. At this stage, the growth focus of the tea market has been on first-tier cities and fourth-tier and below cities, either relying on customer unit price and consumption frequency, or relying on the small number of new consumers in the market who have not yet had consumption habits.
The New Tea Drinks Committee of the China Chain Store and Franchise Association (hereinafter referred to as CCFA) recently released the "2023 New Tea Drinks Research Report" in conjunction with the Meituan New Catering Research Institute. The data shows that the growth rate of orders in the first half of the year in first-tier cities and below-fourth tier cities has remained at 30%. above.
In this regard, the exploration scope of the industry is constantly expanding, and innovation is gradually tending to break the rules. At the 2023 New Drinking Power Competition-Championship in the Tea Drinking Industry hosted by Kamen and sponsored by Big Coffee International not long ago, the winners generally chose tomatoes, sea buckthorn, plums, white pomelo, thyme and other materials that are limited in the tea drinking industry to develop Different application methods integrate tea, coffee, mixology, fresh aroma and other ideas into beverage formulas, and integrate clarification techniques and other techniques, bringing new reference directions for freshly made or pre-made tea drinks.
In the future, the focus of all parties may be on how to combine these new ideas with reliable mass production of food industrialization to impact the taste buds of the market.
It is undeniable that when 9.9 is deeply rooted in the hearts of the people, the "nobility" of the tea industry has gone forever, and it will become more difficult to sell new products at high prices. Whether this trend is good or bad can only be determined in the industry competition of survival of the fittest.
Source: Pinecone Finance