ROME: Although coffee is unlikely to knock tea off its perch as the most popular hot drink in China any time soon, Illycaffe, one of Italy’s best-known coffee brands, is betting big on the Chinese market over the next few years, reported Xinhua.
According to data firm Statista, coffee consumption per capita in China is just 9 cups a year, compared to nearly 700 a year in Italy.
While Italy’s per capita coffee consumption rate has been more or less steady for years, the Chinese market is growing at a rate of more than 30 per cent per year. Over the last 14 years, according to the coffee trade journal Comunicaffe International, the Chinese market has swelled by more than 1,000 per cent.
“The coffee wave in China is already starting, but when it takes full force, we want to already be well established there as a player in the market,” Illy’s chief executive Cristina Scocchia told Xinhua.
“One thing experience has shown us is that China can be very quick to adopt trends. The speed of innovation in China is tremendous.”
Illy is not the only company to recognise the potential of the Chinese coffee market. Other leading Italian brands, including rival Lavazza, are also present in China, as well as the United States coffee behemoth Starbucks.
Illy first entered the Chinese market five years ago, and the company has an expansion strategy it believes will allow it to double or triple its sales in China by 2026, outpacing the growth of the market as a whole.
Scocchia said the company will decide on another key aspect of its strategy this year, as it plans for potential partnerships.
“We are evaluating whether we should work with a partner who knows the local market well to help facilitate our move into e-commerce, or if we should go on our own,” Scocchia said.
“It’s too big of a market to improvise. So we’ll start with e-commerce and then evaluate partnerships for a move to coffee systems for restaurants, and then to direct retail, step by step. This year, this is our goal; to find partners for e-commerce and to set the stage for a move to retail in 2024.”
Illy is already present in 140 countries, with around a third of sales in Italy.
However, Scocchia said: “We have to build bigger markets abroad. Right now, our sales are too fragmented. We have studied to determine which markets can become a second home market for us and the best option is China.” – BERNAMA
