Cheese Latte "Big Data Price Discrimination"? Luckin Coffee Responds

The Controversy Over "Big Data Price Discrimination"

Earlier media reports revealed numerous instances of consumers encountering "big data price discrimination" across various sectors: video platforms where members pay higher delivery fees, travel scenarios where the same hotel room type is priced differently for different customers, regular customers paying more than new ones at the same store, and ride-hailing services where identical routes cost differently depending on the customer. Consumers can easily become targets of such discriminatory pricing without realizing it.

Luckin Coffee's Pricing Controversy

Recently Luckin Coffee drew attention amid allegations of price discrimination. Many netizens complained that the price of Luckin's Cheese Latte had risen from 9.9 yuan to 18 yuan, yet some customers could still get it for 9.9 yuan. That led many to ask whether Luckin was engaging in price discrimination too.

Responding to media inquiries, staff in Luckin Coffee's relevant department explained that, after comprehensive consideration of business operations, labor costs, rent, and delivery factors, prices vary between branches, which produces certain price differences, and that promotional activities are distributed randomly by the system. Based on that explanation, the phenomenon of different prices for the same product does exist, but Luckin denies engaging in price discrimination. So how do these price differences between customers actually arise?

Customer Experiences and Reactions

Netizens shared personal experiences. One user said, "My account is getting more and more expensive, but some people can even get Cheese Lattes for free while I cannot." Others expressed dissatisfaction after getting membership cards. One commented, "How is this possible? I got a Freedom Card but it's still so expensive. How dare you? If this continues, I'm done drinking your coffee." Another said, "They don't cherish loyal customers at all. Starbucks, which I haven't visited in a long time, occasionally sends me 40% off coupons. What makes Luckin Coffee so superior? I'm switching today."

Some netizens, however, took the opposite view: "You expect them to give you 9.9 yuan coupons every day, and when they don't, you accuse them of price discrimination. These are promotional coupons that naturally expire after use." In their view, it is acceptable for Luckin to offer different discount schemes to consumers with different habits.

Earlier Incidents and Consumer Trust

Previously, in March 2021, the possibility of Luckin Coffee engaging in big data price discrimination was reported by CCTV Financial's "Consumer Perspective" program. A Ms. Xu from Changsha, Hunan Province, reported that when she and colleagues ordered Luckin Coffee to the same address for the same products, she encountered price differences and even discriminatory delivery fees. She believed the different pricing was because of her daily coffee purchases.

Ms. Xu, a high-frequency Luckin Coffee consumer, was extremely angry. She complained directly by calling Luckin's customer service. Luckin responded that this was part of its pricing system, where different customers have different prices, but it was willing to compensate her with a coffee voucher. The consumer was not satisfied: "I'm not communicating with you just to get one coffee voucher."

Luckin then called back to explain the details of its pricing system, but the consumer said, "You don't need to explain your pricing system further. I don't need compensation either. I just won't drink your coffee anymore." Despite later attempts to resolve the situation with coffee vouchers, Luckin apparently failed to regain her trust.

The Broader Issue

Big data price discrimination in online consumption has become a shared concern among authorities and consumers in recent years. According to media reports, a law firm director believes that practices which do not target new users but instead apply price and rule differences based on different users' consumption habits and frequency all constitute forms of price discrimination. Luckin apparently holds a different view.

Image source: Internet

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