“Design in China”​ e05 – Seesaw Coffee – Brewing China’s Specialty Coffee Culture

What does going Direct-to-consumer (DTC) mean? Selling direct-to-consumer, commonly referred to as DTC or D2C, means you’re selling your products directly to your end customers. Sellers bypass any third-party retailers, wholesalers, or any other type of middlemen to deliver their products.

Recognizable examples of DTC brands include CasperWarby Parker, and Dollar Shave Club. However, there are now thousands of sellers undertaking this unique approach. These DTC brands are leveraging mobile and digital channels that are bypassing traditional sales models.

DTC brands are usually sold exclusively online or specialize in a specific product category. However, top growing brands are expanding to other channels like their own storefront or exclusive partnerships with other retailers.

Branding over Sales Performance

China consumption has evolved already. Many start-ups from mainland China experienced new way of purchasing clothes but also electronic accessories and food for years. They’ve already generated high volume of online sales and are now developing more sophisiticated and creative product and online ad campaign to elevate their brand. From a strong product positioning they are creating strong brand to retain existing users and attract new consumers. I’ll comment on the one I found interesting and worth sharing with followers here. #ChineseCulturalConfidence

These brands understand why brands are so important? #为什么要做品牌

“The most important thing really, is this notion that the consumer has changed, and really a lot of retailers are way, way, way behind the curve,” said Paula Rosenblum, co-founder of retail advisory firm RSR Research – source CrunchBase

Seesaw Coffee is one of many homegrown coffee shop chains in major Chinese cities that are bringing specialty coffee to the public. China has long been a lucrative market for coffee franchises, with Starbucks leading the market share. However, a new wave of coffee shops is dotting the corners of Chinese cities that keep coffee local. While China produces coffee in certain provinces, it imports most of it from countries like Brazil, Vietnam, Italy, and Malaysia. Seesaw Coffee is working with mostly locally cultivated coffee, working with farmers in the Yunnan region. The company’s guidelines for producing quality coffee beans have transformed into a 10-year project to help develop coffee farming in the region and to improve production quality.

Businesses like Seesaw Coffee are transforming China’s coffee culture, adding more coffee shops to their cities. Shanghai, the most populated city in China, is considered the coffee capital of the world today. With 7,857 coffee shops across the metropolis, Shanghai is also home to Seesaw Coffee and several other Chinese-owned coffee shops and brands. High-end coffee shops selling a hot cup of latte or a cold brew at premium prices is no new concept in Western business hubs like London or New York City. The latter is home to some of the most expensive coffee shops in the world, including the $18 cup from Brooklyn that went viral in 2017. On the other side of the Pacific, such high-end coffee shops are still a nascent idea but one that China’s growing middle class welcomes.

For businesses like Seesaw Coffee, creating a friendly environment for the customers who walk in to buy a cup of coffee is important. But providing a quality brew is equally important. It has over 12 locations in Shanghai alone, becoming a ubiquitous name for coffee lovers. It has also opened shops in Beijing, Shenzhen, and Suzhou. So expansion has been steady for the 10-year-old brand that began in 2012.

There has yet to be a global Chinese coffeehouse chain or even a coffee manufacturer, with most of the market dominated by North American and European brands. The global organic coffee market is projected to reach $12.6 billion by 2026, which presents unique opportunities for Chinese coffee businesses like Seesaw Coffee. That said, it remains to be seen how the current high inflation around the globe impacts people’s spending on coffee shops.

Seesaw Coffee has taken on a similar approach to coffee as many existing specialty coffee shops stretching from Seattle to Dubai that don’t just offer premium coffee but also offer an experience by cultivating welcoming spaces. It has succeeded in Shanghai and aims to expand to other big cities in China. Perhaps, it’s only a matter of time before it considers expanding beyond the country’s borders. 

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