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Key points included

  • Coffee extract food arouses interest
  • Develop coffee with plant ingredients but no reduction of dairy flavour
  • Drive consumption of niche coffee drinks by collaborating with KOLs

Covered in this report

The on-premise coffee market is estimated to see a double-digit growth rate in both value and volume in 2019. The value market is mainly driven by various consumption purposes, such as energyboosting and relaxing, which further drive more consumption occasions. Also, consumers’ increasing knowledge of on-premise coffee encourages them to pursue more specialty coffee drinks. The increasing outlets are mainly due to store expansion and more new players whose core business has not been on-premise coffee in the past join the market.

Expert analysis from a specialist in the field

Written by Belle Wang, a leading analyst in the Food & Drink sector, her extensive knowledge delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

Consumers consider that coffee beans from a famous region/category are essential for making an ideal coffee. Besides simply saying the region/category name, businesses could introduce the coffee beans’ unique intrinsic features from certain famous coffee regions. Moreover, coffee houses could develop snacks/desserts made of coffee extract and own branded RTD coffee for more occasions, such as on the go, after a meal or afternoon-tea dessert, etc Belle Wang
Food & Drink Analyst

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What's included

What's included

Table of contents

Table of contents

  1. Overview

    • What you need to know
      • Covered in this Report
        • Excluded
          • Definition
          • Executive Summary

              • The market
                • Market value experiences strong growth
                  • Figure 1: Best- and worst-case forecast for sales value of on-premise coffee, China, 2014-24
                • Market volume driven by rapid business expansion
                  • Figure 2: Best- and worst-case forecast for on-premise coffee house numbers, China, 2014-24
                • Companies and brands
                  • Traditional coffee house chains improve consumers’ overall experience
                    • New retail coffee houses perform differently
                      • New players enter C-store coffee market
                        • Fuse Chinese and Western cultures in innovation
                          • Borrow ideas from sauce and seasonings
                            • Provide more fun during drink time
                              • The consumer
                                • Between meals is the main consumption occasion
                                  • Figure 3: Consumption channel and occasion, China, August 2019
                                • Fusion coffee drinks attract more attention
                                  • Figure 4: Coffee drink penetration, China, August 2019
                                • Creamy texture and famous coffee bean origin win most consumers’ preference
                                  • Figure 5: Features of an ideal coffee, China, August 2019
                                • Consumers present a high preference for adding plant protein
                                  • Figure 6: Interest in coffee drink innovation, China, August 2019
                                • Western staple food and Chinese dessert have potential to develop
                                  • Figure 7: Preference for other products in coffee houses, China, August 2019
                                • Coffee house-branded RTD coffee has opportunity to grow
                                  • Figure 8: Attitudes towards on-premise coffee, China, August 2019
                                • What we think
                                • Issues and Insights

                                  • Develop coffee with plant ingredients but no reduction of dairy flavour
                                    • The facts
                                      • The implications
                                        • Figure 9: Coffee with avocado, China
                                      • Coffee extract food arouses interest
                                        • The facts
                                          • The implications
                                              • Figure 10: Coffee snacks and desserts, China & Australia, 2019
                                            • Drive consumption of niche coffee drinks by collaborating with KOLs
                                              • The facts
                                                • The implications
                                                • The Market – What You Need to Know

                                                  • Both value and volume market experience double-digit growth rates
                                                    • More players enter the market
                                                      • Various consumption purposes and occasions mutually promote purchasing
                                                      • Market Size and Forecast

                                                        • Largely improved availability drives strong growth of market value
                                                          • Figure 11: Best- and worst-case forecast for sales value of on-premise coffee, China, 2014-24
                                                        • Diversified business scales and more new players stimulate market volume
                                                          • Figure 12: Best- and worst-case forecast for on-premise coffee house numbers, China, 2014-24
                                                      • Market Factors

                                                        • Crazy expansion of Luckin Coffee has further driven more players into the market
                                                          • Multiple consumption purposes drive more occasions
                                                            • More innovative packaged coffee affects on-premise coffee consumption
                                                            • Key Players – What You Need to Know

                                                              • Traditional coffee house chains experience steady expansion
                                                                • Different expansion strategies for new retail coffee houses
                                                                  • The fast expansion of existing brands and arrival of new players
                                                                  • Market Share

                                                                    • Traditional coffee house chains grow steady
                                                                      • Figure 13: Outlets number of key players, China, 2018 and 2019
                                                                    • New retail coffee houses strengthen their stores and products innovation
                                                                      • C-store coffee focus on store expansion
                                                                      • Competitive Strategies

                                                                        • Reinforce the integration with delivery and pick-up service advantages
                                                                          • Enhance brand image by store design and product quality
                                                                            • Increase drink and food selections
                                                                              • Figure 14: Innovative coffee drinks blurring with tea shop drinks and dessert, by Coffee Box, China, 2019
                                                                          • Who’s Innovating?

                                                                            • Fusion with Chinese elements
                                                                              • Figure 15: Coffee houses infuse Chinese style, China, 2018-19
                                                                            • Innovative flavour inspired from sauce and seasonings
                                                                              • Figure 16: Innovative flavours, China, 2019
                                                                            • Create an entertaining coffee experience
                                                                              • Figure 17: Innovation on ways of drinking, China
                                                                          • The Consumer – What You Need to Know

                                                                            • Delivery service affects consumers’ purchasing habits
                                                                              • Ways of developing sweet and savoury coffee
                                                                                • Take advantage of the intrinsic features of on-premise coffee
                                                                                • Consumption Channel and Occasion

                                                                                  • Traditional chains still dominate the market
                                                                                    • Figure 18: Penetration of on-premise coffee channels, China, August 2019
                                                                                    • Figure 19: Ranking sequence of certain on-premise coffee channel penetration, China, September 2018 and August 2019
                                                                                  • Majority of consumers purchase fresh coffee between meals
                                                                                    • Figure 20: Consumption channel and occasion, China, August 2019
                                                                                  • Western-style fast food restaurants become more important in meal occasions
                                                                                  • Product Penetration

                                                                                    • Fusion coffee drinks are the most popular
                                                                                      • Figure 21: Coffee drink penetration, China, August 2019
                                                                                    • Develop specialty coffee in tier two cities
                                                                                      • More females aged 20-29 interested in black coffee
                                                                                        • Figure 22: Penetration of selected coffee drinks, by gender and age, China, August 2019
                                                                                    • Ideal Coffee

                                                                                      • Communicating origin with consumers is more competitive
                                                                                        • Figure 23: Features of an ideal coffee, China, August 2019
                                                                                        • Figure 24: Detailed introduction of coffee beans, by Essence Café, China, 2018
                                                                                      • Quality of coffee bean and machine would get more important
                                                                                        • Figure 25: Features of an ideal coffee, by different consumer groups, China, August 2019
                                                                                        • Figure 26: Coffee served with an information card, by e.R Coffee Roasters, China, 2019
                                                                                      • Introduce sweet and savoury flavours on certain drinks
                                                                                        • Figure 27: Coffee drink consumption, by selected features of an expected ideal coffee, China, August 2019
                                                                                        • Figure 28: Black coffee with French cheese milk cap, by Coco, China, 2019
                                                                                    • Interest in Innovation

                                                                                      • Coffee with plant protein arouses most interest
                                                                                        • Figure 29: Interest in coffee drink innovation, China, August 2019
                                                                                      • Innovate on creamy coffee
                                                                                        • Figure 30: Interest in innovation – TURF Analysis, China, August 2019
                                                                                      • 20-24s present very different interests than other age groups
                                                                                        • Figure 31: Interest in coffee drink innovation, by age, China, August 2019
                                                                                      • Preferred innovation on different coffee drinks
                                                                                        • Figure 32: Coffee drinks consumption, by innovative attributes, China, August 2019
                                                                                    • Preference for Other Products in Coffee Houses

                                                                                      • Food preference of main fresh coffee consumers – 30-39s
                                                                                        • Figure 33: Preference for other products in coffee houses, China, August 2019
                                                                                      • Western staple food is of importance
                                                                                        • Figure 34: Preference for other products in coffee houses – TURF Analysis, China, August 2019
                                                                                      • Introduce gifting pack or tie-in sale
                                                                                        • Figure 35: Coffee drink consumption, by preference for other products in coffee houses, China, August 2019
                                                                                    • Attitudes towards On-premise Coffee

                                                                                      • Consumers have and expect to gain more coffee knowledge
                                                                                        • Figure 36: Attitudes towards on-premise coffee, China, August 2019
                                                                                      • Embrace a modern lifestyle by having a famous on-premise coffee
                                                                                        • Figure 37: Attitudes towards on-premise coffee, China, August 2019
                                                                                      • Develop own-label RTD coffee
                                                                                        • Figure 38: Attitudes towards on-premise coffee, China, August 2019
                                                                                      • Communicate intrinsic coffee taste of on-premise coffee
                                                                                        • Figure 39: Attitudes towards on-premise coffee, China, August 2019
                                                                                    • Meet the Mintropolitans

                                                                                      • Design a coffee drink for MinTs
                                                                                        • Figure 40: Selected feature of an ideal coffee and selected interested coffee drink innovation, by consumer classification, China, August 2019
                                                                                      • Products that MinTs expect to buy in coffee houses
                                                                                        • Figure 41: Consumption occasions and selected channel – traditional coffee house chains, by consumer classification, China, August 2019
                                                                                        • Figure 42: Preferred products except coffee drinks in coffee houses, by consumer classification, China, August 2019
                                                                                        • Figure 43: Suitcase, by Starbucks, China, 2019
                                                                                    • Appendix – Market Size and Forecast

                                                                                        • Figure 44: Best- and worst-case forecast for sales value of on-premise coffee, China, 2014-24
                                                                                        • Figure 45: Best- and worst-case forecast for on-premise coffee house numbers, China, 2014-24
                                                                                    • Appendix – Market Segmentation

                                                                                      • Methodology
                                                                                        • Fan chart forecast
                                                                                          • Abbreviations

                                                                                          About the report

                                                                                          This report will give you a complete 360-degree view of your market. Not only is it rooted in robust proprietary and high-quality third-party data, but our industry experts put that data into context and you’ll quickly understand:

                                                                                          • The Consumer

                                                                                            What They Want. Why They Want It.

                                                                                          • The Competitors

                                                                                            Who’s Winning. How To Stay Ahead.

                                                                                          • The Market

                                                                                            Size, Segments, Shares And Forecasts: How It All Adds Up.

                                                                                          • The Innovations

                                                                                            New Ideas. New Products. New Potential.

                                                                                          • The Opportunities

                                                                                            Where The White Space Is. How To Make It Yours.

                                                                                          • The Trends

                                                                                            What’s Shaping Demand – Today And Tomorrow.

                                                                                          Please Note: This is a sample report. All of the figures, graphs, and tables have been redacted.

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