Encouraging Chinese consumers to wake up and smell the coffee

Coffee consumption continues to grow impressively in China, with the market registering consistent annual double-digit growth between 2011 and 2016, according to Mintel’s Coffee – China 2016 report. However, a measure of how China is still a young coffee market is the low frequency with which most consumers drink it.

For example, while the vast majority of Chinese 20-49 year-olds drink instant coffee, still by far the most popular coffee type, only 30% drink it once a day or more.

This contrasts markedly with Europe, where the overwhelming majority of coffee drinkers consume the beverage more than once a day, often many more times a day. This is a result of coffee having become an ingrained habit (and for some an addiction), with many Europeans viewing coffee as an essential means of kick-starting their day.

Coffee consumption in China is mainly driven by a group of more Westernised, early adopters, which Mintel refers to as “Mintropolitans”, which make up an estimated 27 million households. Mintropolitans is a term for those Chinese consumers who live in tier one cities, are highly educated, big consumer spenders and “culturally sophisticated”, according to Mintel’s Marketing to Mintropolitans – China 2016 report. Mintropolitans often work in non-Chinese companies and also live in the bigger, high profile Chinese cities which have more exposure to Western food and drink products.

While Mintropolitans are much more likely to have a regular coffee habit, there is clearly scope to develop the habit further.

Coffee brands are missing out on early morning occasions

Chinese adults primarily use coffee reactively as a stimulant when feeling tired. For example, three-quarters of 20-49 year-old coffee drinkers drink coffee when they need an energy boost. In fact, the intensifying pace of life in China – a result of rapid urbanisation and economic development – has encouraged more consumers to lean on coffee’s energy-boosting effects. However, unlike their Western counterparts, Chinese coffee drinkers are not very likely to drink coffee as a habitual energy booster first thing in the morning and only a minority of Chinese drinkers consume their coffee on the way to work.

In other words, coffee producers are missing out on a vital window of sales around the in-home breakfast and pre-work/study occasions. If coffee producers can proactively extend coffee usage from the moment people wake up, they should (in theory) be able to drive greater frequency of usage throughout the whole day, resulting in greater sales.

Jonny Forsyth is Mintel’s Global Drinks Analyst, responsible for researching and writing all of Mintel’s UK drinks reports. He brings ten years of experience working in the marketing industry, with roles at Starcom Mediavest, AB-Inbev, and Trinity Mirror. He is a regular contributor in global and national media outlets such as BBC, CNBC and Bloomberg.