Starbucks Cuts Prices In China As It Fights Intense Competition With Cotti And Luckin Coffee – CoffeeTalk

Starbucks is set to lower its iced drink prices in China by an average of 5 yuan ($0.70) across the country, as competition intensifies and consumers become more cautious about spending. The US-based coffee chain announced the move on its Weixin social media account, stating that it would offer more “accessible” prices on dozens of its drinks, including non-coffee drinks and the Frappuccino, from Tuesday. China is Starbucks’ second-largest market after the US, but the coffee market is highly competitive, with consumers becoming more cautious about spending due to the slowing economy and concerns about job security.

Some of Starbucks’ drinks will be priced as low as 23 yuan, while domestic rivals such as Luckin Coffee and Cotti have priced their drinks as low as 9.9 or 8.8 yuan. Deep-pocketed internet companies JD.com and Alibaba Group have entered the food delivery market, adding to the competition. With offers and vouchers, Chinese coffee consumers can buy themselves a drink for as little as 2.9 yuan.

A person close to Starbucks said the company was not reducing prices in response to intense price competition but looking to attract more customers in the afternoon. Starbucks has previously said it would not engage in a price war but has introduced smaller-sized drinks and issued coupons, which have lowered prices for customers. The US giant has also been looking to revive its business in China via selling stakes in the business.

Read More @ Reuters