Chinese Tea Brands Increasingly Eyeing US Coffee Drinkers With Innovative New Offerings – CoffeeTalk

Chinese beverage entrepreneurs are increasingly targeting the American market, seeking to attract young coffee and matcha consumers with innovative tea offerings. Spearheading this initiative is Amanda Wang, the co-founder of the fast-growing chain Ningji Lemon Tea, who conducted four research trips to the U.S. to launch Bobobaba, a brand customized for American tastes. Bobobaba’s colorful, Instagram-friendly drinks, complete with fruit pieces, boba pearls, and unique branding, aim to resonate with a new demographic. Backed by major tech companies Tencent and ByteDance, Wang sees substantial potential in the U.S. market, highlighting that it represents a developing landscape for bubble tea compared to China.

Wang notes that adapting to the American business environment presents significant challenges, particularly with the slower operational pace; opening a store in the U.S. took seven months, compared to just 20 days in China. She outlined a careful ten-year expansion plan for the U.S. context. In September, Mixue, a brand notable for its $1 fruit teas, secured a ten-year lease for a storefront in New York City and has established itself as the largest food and beverage chain globally by store count, exceeding 53,000 locations.

Other Chinese tea brands, including Chagee Tea House, Chahalo, Molly Tea, and Auntea Jenny, have also commenced U.S. operations or expansion, driven by their success in China’s vibrant tea-drink market characterized by flavor innovations and aggressive branding strategies. Felix Lin, CEO of HF Foods, a distributor for Asian food products in Nevada, remarked on the increasing interest from Chinese food and beverage companies in the U.S. market.

Chagee, recently listed on NASDAQ, has dedicated over 80 employees to its U.S. expansion efforts and plans to launch a major flagship store in Silicon Valley next year. Emily Chang, Chagee’s U.S. lead and a former Starbucks China executive, emphasized the need for a public campaign to promote tea as a viable beverage category in the U.S. A recent initiative by Chagee includes the launch of an “evening tea service,” which aims to demonstrate tea as an enjoyable evening option, highlighting the decline in coffee consumption in the afternoon.

The annual revenue for tea drinks in China is projected to exceed 30 billion yuan ($4.2 billion) this year, reflecting substantial market potential. Many of these brands have capitalized on opportunities beyond China, expanding into Southeast Asia and other Asian markets like Australia, with some venturing into the Middle East and Europe. Wang acknowledges the vast potential for tea brands in the stable U.S. consumer market, although she recognizes that establishing cultural acceptance and brand trust will be the primary challenges moving forward. “Building trust takes time,” she stated.

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