Gong Cha is still booming in Japan
Disclaimer: This article reflects the opinion of the writer and is not meant to constitute as business advice. We will not be liable for any damages or losses caused by this article.
Most people in Singapore would have noticed that bubble tea boom or craze is not that prevalent, now drinks like Matcha, brands like Chagee and Coffee dominate and become the norm. As we are talking, there are more than 40 Chagee stores, and it might only increase from now on.
However, there is something different going on in Japan.
In Gong Cha Tokyo Station Gransta Yaesu, expect to see not only the young ladies, but also the young males and even inbound tourists lining up just to get a cup of bubble tea. Even in the Beans Asagaya Outlet, you can see residents around the area doing the same. One writer for Toyo Keizai thought bubble tea is something that high school girls drink, but apparently according to Mr. Sakai, the Head of Business Management of Gong Cha Japan, the majority of the customers are those in their 30s.
“When Bubble Tea was booming, mostly the customers were high school girls and university students, but as they grow they keep patronizing us, and hence as time goes by the age demographic keeps going up. And the young ladies also introduce their partners and parents, and that’s why our customer demographic keeps getting wider. Now mostly males are 20%, and females are 80% of our customers, most of our customers are in their 30s”, said Mr. Sakai.
In this article, we will be looking into what went well and what I think can be leveraged to a certain extent in other endeavors.
Gong Cha Aimed the Middle Ground in Tea Culture
When you hear about tea drinking culture, mostly you will think that there are two very opposite sides. One side would be buying unsweetened green tea from Family Mart or Lawson. The other would be drinking afternoon tea in a very sophisticated setting in a five star hotel restaurant. What Gong Cha did was smart; it created the middle ground between these two sides. This provides opportunity for a better product to those who want more than just buying a packaged green tea in Family Mart, and a cheaper but still a good product for those who are enjoying high class afternoon tea in these hotels.
This applies to some of the other products as well, and I think if you want to create a new ecosystem, you can aim for the middle ground between the two highly separated segments of a product.
Gong Cha is not just about Tapioca Pearl
When people hear the word bubble tea or even Gong Cha, they will associate it with tapioca pearls. But here’s the interesting thing, when the writer of Toyo Keizai visited one Gong Cha store, they noticed that the straw is mostly small straws, which is not used for tapioca pearl drinks.
Gong Cha might have known that Tapioca Pearl is not something that everyone likes or eats. That is why Gong Cha doesn’t let it’s positioning focus too much on the tapioca pearl, and instead focuses on its position as the mid-tier tea cafe.
I feel this applies to other products as well. Just because it’s your specialty doesn’t mean that everyone will like that. It is up to the owner to diversify the product so that it doesn’t satisfy just one section of the consumer, but is also able to satisfy other sections as well.
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References
Hayahide Sato. “Though the Boom has Ended… The Mystery Behind Gong Cha Who Wins it All, the “Surprising Cup” ordered by Customers”. Toyo Keizai Online.
