The coffee segment in China is growing so rapidly that it has caught the attention of international fashion brands to diversify into this lucrative segment.
One interesting similarity between coffee and fashion is that consumers seem to closely associate top brands with quality products, as such venturing into coffee with own fashion brands will create a positive appeal and impression of high quality coffee as top brands want to maintain their prestigious standing in the consumer market. On the other hand, Chinese consumers enjoy the combination of their favourite fashion brands with coffee, making it a complete ‘lifestyle’ package.
One example is Rock & Ride, a US-based jewelry brand that has expanded into coffee with its first coffee store launched in downtown Beijing. ‘Rock & Ride Taste’ coffee store now offers a limited menu of 4 cold beverages including 3 coffee options and one coffee-tea beverage. Meanwhile, Coach, a US-based fashion house, has also launched its first café in Shanghai, China.
While coffee is leading in this cross-industry trend, tea is also gaining in popularity especially with the younger generation of consumers.
China’s coffee industry reached Rmb 265.4 billion (US$37.6 billion) in 2023 and it is forecast to grow to Rmb 313 billion (US$44.39 billion) in 2024 with a CAGR of 17.14% since 2021. It was also reported that 930 million cups of coffee were consumed nationwide via delivery platforms alone which grew at a CAGR of 66%.
