Yesterday, Luckin launched a new oat latte and a new oatmeal option for its 9 coffee products, which not only meets consumers' demand for diversified and multi-flavor coffee consumption, but also further consolidates Luckin Oat+ gene. It is undeniable that in the current coffee shop, oatmeal latte has long become a familiar and popular coffee drink for the public. What changes can it bring to Luckin and even the entire coffee industry?
Luckin lays out the oat milk market, which is menacing
luckin coffee
When it comes to oatmeal latte, Luckin launched it at the same time as the raw coconut latte in March 2021, laying out the plant-based track. At that time, raw coconut became an instant hit, and as soon as it was put on the shelves, it became a well-deserved "out-of-stock king", and stores in many cities across the country exploded orders, and once sold out, replenished, out of stock, and restocked. After three years of precipitation, raw coconut latte has become an absolute hit, with an astonishing sales of 700 million cups sold in 3 years to achieve performance leadership, and even become popular in the entire coconut-flavored coffee drink track.
After three years, Luckin restarted oat products, and on May 20, a new oatmeal latte was launched, with 9 coffee drinks, such as Oribai, Mocha, Caramel Macchiato and other new oat milk options. It is worth mentioning that the champion oat milk, which also uses the well-known brand OATLY, Luckin's oatmeal latte was sold directly at the price of 9 yuan 9. This wave, Luckin is menacing, and there is a momentum to break down the price of the industry.
The oats + coffee market is surrounded by strong enemies, and Luckin is a game-breaker
luckin coffee
Since OATLY landed in the Chinese market in 2018, it has cut into the market from the coffee channel, so that the CP of "oat milk + coffee" has gradually entered the public eye. In 2020, Starbucks launched its first oat latte in China, selling 62 million cups in just one year. According to Meituan's "China Coffee Consumption Insights" report, from 2021 to 2022, oatmeal lattes have always ranked among the top 10 in the sales list of takeaway coffee.
Image courtesy of OATLY
Under the explosion of Starbucks oatmeal latte, Costa, Seesaw, Tims, KUDDO COFFEE, Grid Coffee and other cafes have laid out oatmeal + coffee categories, not only basic models such as oat milk latte, but also creative drinks produced by oat milk, most coffee brand stores have listed oat milk-related products as a separate series of products at least 5 or more, or even more, which shows that there are many category layouts, and the oatmeal + coffee market tends to mature. It has clearly become the ace drink of the store.
Nashi believes that Luckin still has a chance to break through in the "oatmeal latte" by relaunching the oat latte and adding oat options to its 9 products. First of all, Luckin explosive product making machine. As early as 2021, before the explosion of raw coconut latte, Luckin had created a variety of popular products such as meteorite latte and thick milk latte. The layout of the oatmeal latte, Luckin uses OATLY as the base milk at the same time, purchases high-quality coffee beans from the origin of coffee beans, and combines the two to achieve high-quality coffee, creating a solid foundation for it from the source, coupled with the early explosive product case paving, Luckin oatmeal latte listing is bound to become a market disruptor.
图源:pexels
Secondly, hard-core product power. Whether the oat latte can make consumers recognize and continue to repurchase, the raw material is the key. Luckin joins hands with OATLY, the head brand of oat milk, as the base milk, which has the characteristics of good foaming, high thermal stability, less artificial additives, and low-key taste, which can maximize the aroma of coffee and bring consumers the ultimate coffee taste experience. At the same time, OATLY Coffee Master Oat Milk also meets the four health standards of 0 non-dairy creamer, 0 aspartame, 0 hydrogenated vegetable oil and 0 trans fatty acids released by Luckin. The combination of the two not only brings consumers a rich coffee product experience, but also is more in line with the new life concept of quality, health and sustainability respected by consumers.
Finally, more cost-effective quality enjoyment. In the selection of raw materials, its coffee beans are selected from the finest Arabica beans, carefully selected at the place of origin and carefully blended by the WBC champion team. In the production process, Luckin strictly abides by the requirements of the International Organization for Standardization (ISO) certification system and has passed the ISO food safety management system certification. In particular, this time, the oatmeal latte has joined hands with the head OATLY coffee master oat milk, which is enough to see that Luckin has always adhered to the mechanism of cooperation with the source to reduce costs, and brought consumers a more cost-effective oat latte quality experience with absolute price advantages. It is worth mentioning that Luckin Oatmeal Latte will continue to participate in the weekly 9.9 yuan activity, truly allowing the whole people to enjoy low-cost and high-quality coffee......
In Nashi's view, although Luckin is facing many challenges in its layout at this time, through Luckin's efforts and some acquired advantages, it may once again drive consumers, virtually setting off a new consumption trend of oats + coffee among consumers, and increasing users' favorability and reputation for Luckin.
What is the confidence behind Luckin 9 pieces of 9?
luckin coffee
Once upon a time, price was a barrier to entry for many people to taste high-quality coffee. Why did Luckin, which was "born out of nowhere", dare to be the first among its peers to hit the price of 9 yuan 9 coffee, and stand out in the fierce competition, the reasons for the analysis of Nashi are as follows:
图源:pexels
1) Procurement model. Since entering the coffee industry, Luckin has been deeply involved in the source, with a large raw material procurement team, sourcing high-quality green coffee beans from famous plantations in Yunnan, Guatemala, Brazil, Ethiopia and Colombia in China, and supplying them directly to roasted coffee bean suppliers for processing to ensure the taste and quality of the coffee beans. The new oat milk is also Luckin directly cooperated with the head brand OATLY to get the lowest price, and once again achieved the ultimate control of procurement from coffee to oat milk, bringing consumers high-quality products and enjoying low-price discounts.
2) Self-built intelligent baking factory. It is understood that in 2021, Luckin built and put into operation the first roasting base, fully automated production from green bean processing, roasting, packaging, palletizing to warehousing, and achieved an annual roasting capacity of 15,000 tons of coffee beans.
At the same time, in 2022, it signed a contract with Kunshan Economic and Technological Development Zone, planning to invest a total of 120 million US dollars to build a fully automated production base integrating coffee research and development, roasting production, sales and logistics distribution. The base is expected to be completed and put into operation in 2024, and is expected to produce up to 30,000 tons of coffee beans per year. Moreover, we cooperate with global high-quality suppliers to effectively control the quality and cost of products. This strategy not only ensures the stability of the supply chain and the consistency of products, but also enhances the bargaining power of Luckin in the procurement of raw materials, and re-controls the cost of the terminal price of Luckin Coffee.
3) Diversified store layout. Since its inception, Luckin has focused on the diversity of stores and the construction of an efficient supply chain. At present, the types of stores include flagship stores, premium stores and quick pickup stores to meet the needs of different consumers.
图源:pexels
Today, the scale of stores is close to 20,000, and Luckin has turned coffee, the "just need" of a small number of people, into the "just need" of the public - popular and daily. Coupled with long-term discount activities, it has attracted a large number of new customers and formed repeat purchases. The scale effect of Luckin has greatly and rapidly further spawned the rigid demand for coffee consumption in China, and has continuously fed back into its own business. If the high discount or low price has caused Luckin to bear a lot of pressure and losses, then this siphon effect has absorbed the biggest rigid demand dividend to Luckin itself. Through rapid expansion, Luckin has formed a scale effect and exchanged a huge number of customers for bargaining power. With its own scale advantage, it has promoted the Chinese coffee market to enter the era of high-quality parity.
The closed-loop layout of upstream raw materials, midstream manufacturers and downstream brands not only gives Luckin the confidence to play 9 yuan 9 prices, but also has the strength to carry it out to the end. The addition of oatmeal latte this time enriches the product line and category, and virtually consolidates the brand route of cost-effective product experience that Luckin has long adhered to.
epilogue
luckin coffee
It is undeniable that Luckin has introduced specialty coffee into the lives of mainstream consumers, making high-quality coffee affordable for more people. For consumers, coffee is no longer a luxury in the beverage world, but has become a daily drink associated with leisure, socialization and enjoyment.
Luckin empowers products with innovation, creating many popular products such as meteorite latte, thick milk latte, raw coconut latte, sauce latte, etc., bringing consumers a diversified product experience.