Zhang Lizheng, Brand Director of McCafe: Making coffee requires emotional connection and long-term investment

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Author/Meng Jiayi

Edit/Wooden Fish

According to the 2024 China Urban Coffee Development Report, the scale of China's coffee industry will reach 265.4 billion yuan in 2023, with an average annual compound growth rate of 17.14% in the past three years.

The explosive growth also means that the coffee industry is becoming more and more volatile, with low prices, new products, and services...... According to Meituan, Shanghai, which has the largest number of cafes in the world, will see a decrease in the number of independent coffee shops for the first time in 2023, accounting for 55% of the total number of coffee shops, down from 60.1% last year.

"It's getting harder and harder." After experiencing the "war" of the coffee head player, the industry insiders have become more and more deeply aware of this sentence. According to incomplete statistics from the store opening data and financing, in March 2024, 20 domestic chain coffee brands will open a total of 592 new stores, and there will be 41,273 existing stores. Since December 2023, the pace of coffee store opening has been slowing. March of this year is the month with the fewest store openings since March 2023, and the pace of store opening for chain coffee brands has slowly begun to show signs of fatigue.

At the same time, the coffee track received a total of 2 financings in March, and a total of 5 financings in the first quarter, with a disclosed financing amount of less than 100 million. In March last year, the coffee track received a total of 8 financings, with a financing amount of 415 million yuan. Whether it is the pace of brand opening or the activity of the capital market, it is not as good as the same period last year, and the coffee track is facing a bottleneck.

On May 14, at the New Coffee Conference held by Kamen, Zhang Lizheng, brand director of McDonald's China McCafe, based on the current industry situation, combined with the experience of McDonald's and McCoffee in the catering industry, shared how to achieve a breakthrough in coffee brands with long-term thinking.

Zhang Lizheng pointed out that for a long time, the domestic coffee market is in a state of rapid growth, the market capacity is rising, and the coffee market mainly presents the following three characteristics.

First, the coffee market presents a market pattern of a hundred flowers. Under the coffee track of major subdivisions, different categories such as freshly ground coffee, instant coffee, and ready-to-drink coffee have their own leading brands, which have achieved innovation and breakthroughs on the product side, and continue to deepen and develop on the channel side, leading their own subdivision tracks, so as to achieve the growth of a certain category of coffee.

Second, consumer needs are different. Every consumer's coffee drinking habits and consumption scenarios are different, which also means that their needs will not be completely consistent. However, under every group of consumer needs, there is a group of loyal target consumers, and they can achieve growth and breakthroughs in the coffee category.

Third, consumers' consumption behavior tends to be rational. Consumers' judgment of consumption ultimately returns to the origin of coffee, that is, whether it is a cup of high-quality coffee.

However, she believes that coffee brands must grasp the needs of consumers, create an emotional connection with consumers according to their needs, and must invest in the long term to strengthen consumers' brand identity. On this basis, the coffee brand can go on for a long time.

It is understood that McCoffee is a world-renowned coffee brand and belongs to McDonald's. With its convenient location, affordable prices and wide range of products, it occupies an important position in the global coffee market. As of March 2024, there are more than 3,300 McCafe stores, and more than 1,000 stores are planned to be opened this year, according to Xiaoshidai.

In December last year, McDonald's global executives revealed that McCoffee started in Australia 30 years ago and has become a global success. At that time, McCoffee sold nearly 8 million cups a day worldwide, making McDonald's the world's second-largest coffee supplier. These data can show that McCoffee is worth learning and imitating from other coffee brands.

The following is the full text of the speech by Zhang Lizheng, Brand Director of McDonald's China McCoffee (edited by Tea Coffee Observation, with deletions):

From some of the data that have been published, it can be found that the overall socio-economic operation is still challenging. But we've also seen some very encouraging numbers.

On the one hand, according to the report released by the National Bureau of Statistics in 2023, the total retail sales of consumer goods in 2023 will reach 47 trillion yuan, of which consumption expenditure accounts for 82.5%. We are pleased to see that mass consumption plays a vital and indispensable role in the economic recovery. On the other hand, consumer prices will increase by 0.2 percentage points year-on-year in 2023. These data mean that mass consumers are willing to go out of their homes, and the vitality of the consumer market is constantly rising.

For a long time, the coffee market is in a state of rapid growth, the market capacity is rising, and the coffee market mainly presents the following three characteristics.

First, the coffee market presents a market pattern of a hundred flowers. Under the coffee track of major subdivisions, different categories such as freshly ground coffee, instant coffee, and ready-to-drink coffee have their own leading brands, which have achieved innovation and breakthroughs on the product side, and continue to deepen and develop on the channel side, leading their own subdivision tracks, so as to achieve the growth of a certain category of coffee.

Second, consumer needs are different. Every consumer's coffee drinking habits and consumption scenarios are different, which also means that their needs will not be completely consistent. However, under every group of consumer needs, there is a group of loyal target consumers, and they can achieve growth and breakthroughs in the coffee category.

Third, consumers' consumption behavior tends to be rational. Consumers' judgment of consumption ultimately returns to the origin of coffee, that is, whether it is a cup of high-quality coffee.

Based on the current situation of the market environment and the experience accumulated by McCafe in the past, we can find a way to break the coffee brand from it.

How to break the game?

When it comes to McCoffee, we have to mention McDonald's. McDonald's is willing to have a deep emotional connection with consumers in the process of operation, and it is worth noting that this emotional link does not come from brand marketing, but from consumers' actual experience and their sharing. For example, people who often travel on business, he will share it on Xiaohongshu, saying that "the true meaning of life is to eat wheat and wheat in different places." ”

McCoffee, as a sub-brand of McDonald's, is also consistent with McDonald's, that is, focusing on fans, and fans are our trump card in today's economic environment.

We pay attention to all these high-concentration fan moments shared by fans, we maintain an equal perspective with fans, we become the eyes of fans, we also speak the hearts of fans, and help all McCafe fans record every moment when they have emotional concentration with McCafe, and become an indispensable cup of coffee to accompany them on the road to growth. When it comes to our fans, it's important for them to identify with the brand.

In the process of generating brand recognition from fans, there are three main points.

The first is to make all fans have a strong identity with the brand. The portraits of the target consumer groups of coffee are different, and after being turned into data labels, the emotional temperature and emotional concentration are missing. But in fact, behind the portrait of every group of people, there are very specific living conditions and specific consumer needs.

For example, migrant workers, which is the core group of people that almost all coffee brands can't avoid. Their coffee needs are more concentrated in the morning, and they want their coffee to be relatively simple, which can quickly help them get back to work in a full state.

Second, continue to strengthen the needs of fans. After identifying the core fan portrait, I needed to further understand what his needs were. We found that the opening hours and location of McDonald's and McCafe's stores were highly consistent with the working hours and traffic routes of migrant workers.

On this basis, McCafe can solve the pain point of another morning shift person at the same time, that is, there is no need to go to two different places in order to buy breakfast and coffee. Now, under such insight, McCafe launched a new platform in February this year, a 15 yuan freshly ground coffee breakfast platform. On this platform, consumers can not only eat a high-quality breakfast, but also drink high-quality coffee.

The third is how to achieve the emotional identity of fans. As a migrant worker, there are actually a lot of emotions that I want to vent and share, and accordingly, McCafe has also landed a number of activities to increase emotional communication with fans.

The most important thing is that the 15 yuan freshly ground coffee breakfast platform launched by McCafe for consumers is not a short-term behavior, but a long-term investment. Because McCafe firmly believes that we can understand our fans, understand the identity needs of fans, understand the emotional needs of fans, and hope to be able to work with consumers for a long time.