Abstract:Luckin Coffee becomes a celebrity since beginning of 2018.It has been integrated into our life in many ways. When we take the elevator to and from work every day, we could see the advertisement of Luckin Coffee as well as the link from Wechat of sharing free coffee.People are comparing it to Starbucks, and although differences abound in positioning and business models. As superficial competitor of Starbucks, Luckin Coffee shows it success. Behind the comparing, we shall see how they “compete” in the following content and to finalize if they are real competitors.
1. Analyze a Luckin coffee shopXiaoqi. Zheng (Mike) ID:8301262571。分析一家樂金咖啡店小七。鄭（邁克）身份證：830126257
Taylor and Francis (2005) said that “As consumers, we are continually exposed to different experiences and influences. Some of us are more susceptible to change and influences than others, but nobody goes through life remaining the same as they were at birth. Some of our responses to the environment are because of our psychological makeup. As our situations change, opportunities emerge as we become subject to a wider range of influences to which we might respond in a positive or negative manner. Changes in circumstances may arouse innate needs or promote new needs and wants in our consumption patterns.”Luckin Coffee embrace the new retail concept. They managed to blend in their online and offline marketing efforts and retail channels. Luckin Coffee is entering the market in a new way.
1.1 Luckin coffeeExperience Map1.1 Luckin咖啡體驗圖
As a consumer, I truly experienced the consumption process of Luckin Coffee. As you see under experience map.
During the experience, the overall experience was good, but there were still lower-than-expected parts. There are several advices:
? There is a business problem. Once the coffee is made or finished, it cannot be cancelled or modified for delivery. Suggest improvements.
? There are no complaints and suggestions of function, and it is recommended to increase user feedback.
? APP is not smooth enough,Luckin Coffee should create a WeChat mini- program, and they’re so convenient and even easier to share.
? Fewer stores, suggested to increase offline stores
? There is a problem with the packaging. When the coffee is delivered, the coffee is not hot. It is suggested to improve the packaging
? Luckin Coffee should not only rely on online marketing, but also improve the quality of our products
? The target group should cover more age groups
1.2The target group of Luckin Coffee
Now the domestic Coffee market is highly competitive. Luckin Coffee's ideais "product + service + culture" experience mode, use APP to complete reservation, self-deliver and other consumption methods. This not only reduces the possibility of queuing, but also saves users' waiting time. It can be seen that the target group of Luckin Coffee is a group of professionals with certain professional requirements on Coffee -- urban white-collar workers
1.3 The Price level of Luckin Coffee
Starbucks, Costa, Luckin Coffee, three coffee comparison, and the same latte has different capacity, beans, flavor and price. Starbucks has high quality and price (30RMB), Costa medium quality and price (28RMB), and Luckin coffee high quality and low price (24RMB).as you can see under “Price / Quality Strategies”
The price level of Luckin Coffee is Super Value
1.4 Luckin Coffee positioning level in the Maslow pyramid of needs
In fact, today's instant coffee (such as Nestle) meets only the first level of physiological needs; the high - grade self - living coffee machine can meet the physiological needs and at the same time give consideration to certain emotional needs. The coffee shop can meet the needs of the first, second and third levels at the same time. Only consumption at a higher level of Maslow demand is the direction of the future.Luckin coffee abandons the third-level social needs, focuses on the "physiological + emotional" needs, cancels the on-site food and turns it into a takeaway, and maximizes the cost.
2. Analyzing Starbucks
2.1 Starbucks Experience Map
From the analysis, we can see this Starbucks coffee taste good, but in the morning the line is too long and moves slowly, it will affect the time of office worker. They need adding barista or improve process in the morning management. Otherwise, they could divide into relax zone and chatting zoo to improve customer experience satisfaction.
2.2 The target group of Starbucks
The target market for Starbucks in China is the first-class city, developed cities in coastal region and relatively developed secondary cities. So their target group is the people who have advanced education, higher income, coffee lover and random coffee consumers. This group people belongs to the upper class pursuit of taste and the middle class pursuit of fashion.
2.3 The Price level of Starbucks
2.4 Starbucks positioning level in the Maslow pyramid of needs
Starbucks aim to build a space with leisure oriented, and let customer have anElegant and comfortable experience. Their slogan is the top quality coffee shape unique humanistic spirit and make customer feel coffee aroma and spiritual literation.Starbucks coffee isn’t just coffee, it is sensory experience, emotional experience and action experience. So Starbucks positioning level belongs to social needs in the Maslow pyramid
3. Comparing Starbucks and Luckin Coffee Shop
3.1 Product Competitiveness
To compare between Luckin Coffee and Starbucks Coffee, we went to both stores to make an evaluation for the competitiveness. Based on the Competitive table below, we can see the strength of Luckin is the price and convenience. Many Starbucks stores are located at expensive, high-traffic CBD buildings which make the rivals cannot survive. But most Luckin outlets are not in such spots, they put their outlets near the CBD or shopping malls which are cheaper to rent. This reflects their marketing strategy is different.
Coffee Brand Taste Quality Price Convenience Location Total
Luckin Coffee 6 7 9 8 8 38
Starbucks Coffee 10 9 7