Starbucks Ain’t Luckin!☕

What does that mean? Well, you’re you. I’m me. You ain’t me. I ain’t you. Starbucks ain’t Luckin. What the hell is Luckin? Thank God we’re not in China or the bright blue ads would have been in our faces. I’m sure you must’ve heard of their name after their accounting scandal and fraud case. This post isn’t about that. It’s about the nascent stages of Luckin and how they spread exponentially across China like wildfire. Not kidding.

Luckin is a Chinese coffee brand founded in November 2017 and has opened up 18,500 stores in China as of May 2024, exceeding Starbucks’ count. How the heck did they get so Luckin’? They started distributing free samples to anyone who ordered more than 2 cups of coffee, downloaded their app, recommended the app or just followed them on social media. Who doesn’t love freebies?

Firstly, in a land which is known for their consumption of tea and hot water and not so much for coffee, was it a smart move to open up a store for coffee when they know what the competition is? Quite gutsy, risky but a bold move indeed, in a tea drinking nation.

Strategy Behind Luckin's Success!Power of Freebies - They can’t survive giving away freebies forever right? That was done to build a relationship first, and loyalty next. They did acquire a lot of customers because they were pocket-friendly, unlike Starbucks. There was a lot of offline and online marketing buzz generated on social media.

Unique Delivery Model - What’s different? They didn’t rely on the Chinese equivalents of Swiggy, and Zomato which are Ele.me or Meituan, instead, they signed a deal directly with the delivery company, Alibaba. This meant no men in uniforms waiting to pick orders, instead they created 3 different types of stores -

1. Sit and sip your coffee

2. Takeaway

3. Delivery.

   
   

Usually, these activities happen under one roof, but Luckin innovatively separated them. Great move!

Blue vs White Cup

I mean, the battle of brews between Luckin and Starbucks is fun. A 6-year-old start-up to compete with the American giant in itself is a HUGE success. We have a lot to learn from them but here’s why they are far from beating the giants.

Starbucks never sells you a coffee. They sell an experience. What you call an overpriced coffee is the price of your luxury and the personalized touch to your quintessential white cup with your name written on it. Not to forget the endless selfies you take for the gram.

Luckin can’t position themselves like that anytime soon. Their prices are affordable no doubt, but they’re the ‘I’m running late for work, let’s grab a coffee’ brand. Whereas if you’re asking someone out for a coffee date, I bet you’d go to Starbucks. You go there to rejuvenate. Can’t say the same for Luckin.

But hey! Here’s how Luckin can get lucky :

1. By Focusing on Positioning it as not just a cost-effective convenient coffee brand but also a brand that makes you FEEL a certain way. There’s no need to copy Starbucks’ idea and design. Give your stores a different and interactive touch where customers can leave a bit of themselves each time they visit the store. Post-its on walls/ a wall full of feedback, quotes, and doodles. At Starbucks, you write for your customers. At Luckin, let them write for you. More reviews get you more customers.

2. Quality over Quantity ALWAYS — Let the menu be simple with fancy names but pay close attention to Espresso, and Italian coffee since most brands don’t get these right. It’s a coffee house, the taste HAS to be a warm hug in the mug.

3. Stop craving for loyalty at such a young age. First, get them to know you, give them time to love you, and then expect loyalty. STOP rushing. A good start would be to put up stalls in fests (since you’re so famous already), have cool merchandise, keep hosting fun competitions online and interact with your audience. Show them you care.

4. Hire a good Creative Consultant — I can’t emphasize this enough. Not that I understand Chinese but these ads DO NOT look visually appealing, it’s in your face.

   

5. Learn from History — I’d like to share an epic example of what I call risen from the dead. In 1900, Claude Hopkins worked on a failing brewery’s ads from a new angle and instead of emphasizing the pureness of the beer, he spoke about the process of how it’s made.

   

Details often go unnoticed but when it’s beer or coffee, your customers want to read what goes into the making of it. Let me show you what I mean. Nescafe’s vintage ads have worked on this idea with the headline ‘Perfect Coffee, Instantly made’.

This is how the Process becomes a benefit in and of itself.

Since most ads these days focus on the features, you may want to dive into the details and show them the lengths to which you go to brew the perfect cup of coffee. Guaranteed results.

6. Lastly, Know Your Target Audience — There are a lot of ways to differentiate yourself and have your own unique identity but when it comes to competing with Starbucks, you should know your TG well enough. Focus on the masses, don’t tap into their audiences. Get your own and learn about them, know them fully, and retain them.
   

Ultimately, you brew you. ☕

Best of Luckin’ to you. 💌

Love,

K 🌻