South Korean Premium Coffee Chain Ediya Coffee Re-enters Chinese Market, Launches on Tmall to Sell Instant Coffee!

According to Yonhap News Agency, South Korean coffee chain brand EDIYA COFFEE recently announced its entry into China's Tmall platform within the month. Previously, EDIYA COFFEE had already expanded beyond South Korea, exporting its instant coffee products to countries including Mongolia, Australia, and the United States. The company stated that entering China's e-commerce market will serve as an opportunity to engage with more overseas consumers.

According to sources, EDIYA COFFEE will focus on selling instant coffee, coffee capsules, and blended tea products on the Tmall platform. EDIYA COFFEE expressed that these products are highly favored by Korean consumers, and they believe Chinese consumers will also appreciate similar products.

China's Coffee Market Analysis

This entry into Tmall platform suggests EDIYA COFFEE has conducted research on Chinese coffee consumption patterns. As of 2020, instant coffee accounted for 52.4% of China's coffee market. However, with the popularization of coffee culture, while instant coffee still holds the largest market share, an increasing number of consumers have begun purchasing freshly ground coffee. Domestic local chain coffee shops have become the primary destination for Chinese consumers seeking freshly ground coffee. Analysts predict that by 2023, the share of freshly ground coffee in China's coffee market will rise above 51%, while instant coffee's share will decrease to less than 40%.

EDIYA COFFEE's Strategic Approach

This presents a significant competitive opportunity for EDIYA COFFEE. By entering through e-commerce channels and selling instant coffee and coffee capsules, they can build a customer base and brand recognition before establishing physical stores in China. This might lead you to wonder: why doesn't EDIYA COFFEE directly open stores in China? They certainly considered this approach and actually tried it before... apparently learning from past mistakes, hence their more cautious approach this time.

Previous Attempts in Chinese Market

As early as September 2005, EDIYA COFFEE entered the Chinese market by establishing a branch in Beijing. However, due to poor market reception, the brand survived only three years in Beijing before withdrawing from the Chinese market. Then in 2018, sensing rapid growth potential in China's coffee market in the coming years, they announced on October 17, 2018, plans to open their first specialty coffee chain store in Beijing within 2019. Clearly, the rise of Luckin Coffee and Manner in 2019 caused them to halt their plans, and to this day, EDIYA COFFEE stores have yet to appear in the Chinese market.

New Strategy for Market Entry

Now, with China's pandemic situation being more stable compared to other countries, domestic consumption levels are recovering, primarily through e-commerce platforms. Therefore, EDIYA COFFEE plans to start by entering Tmall to sell its products, attracting Chinese consumers' attention through extensive promotional activities. Once they establish sufficient brand recognition in China, they will reconsider opening physical stores.

EDIYA COFFEE Background

EDIYA COFFEE was founded in 2001 and opened its first physical store. In August 2003, they opened their 100th store, followed by their 200th store in October 2006. As of September 2016, the EDIYA COFFEE brand operated over 2,000 stores, making it the coffee brand with the most locations in South Korea and the most representative coffee chain brand in the country. Due to affordable prices and consistently stable coffee quality, EDIYA COFFEE maintains a solid position in the hearts of Korean consumers.

Current Market Challenges

Compared to their first entry into the Chinese market, EDIYA COFFEE now faces many more competitors. Online, there are brands like Sandunban, Yongpu, and Osumi River, while offline, there are local small-format chain brands like Luckin Coffee and Manner. For EDIYA COFFEE to now try to claim a share of the market will likely be quite challenging...

Image source: Internet

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