What the Fear Coffee Brand Story Says About Coffee Wing's Listing

In March 2017, Coffee Wing listed on the New Third Board, and its shareholder lineup drew wide attention: Yin Feng, He Jiong, Chen Ou, and Yao Jinbo all appeared among the top ten shareholders. Founder Yin Feng described the company's growth as resting on four words, IP and crossover for market influence, data and capital for sustained operations, making it a benchmark case of cross-industry dining.

Yin Feng laid out the logic at a 2017 Catering O2O event, citing Meituan data that post-80s and post-90s consumers contribute 70% to 80% of market spending power. He argued that refinement, standardization, and legalization in China's catering industry opened the path to public markets, supported by an internal management and function coffee system built over 17 years covering ERP, SCM, and related operations.

In March 2017, Coffee Wing was officially listed on the New Third Board, and the shareholder lineup of celebrity investors such as Yin Feng, He Jiong, Chen Ou, and Yao Jinbo drew widespread attention. As a benchmark case of cross-industry dining, what exactly has enabled Coffee Wing to achieve sustained growth? At a sharing session hosted by Catering O2O, founder Yin Feng systematically explained the business logic behind the four key words "IP, crossover, data, and capital," from the consumer shifts in the Catering 3.0 era, to the two approaches of resource integration and strategic layout, and then to specific strategies such as celebrity userization and product personification, fully decoding the capital path of this entertainment coffee brand.

On March 24, 2017, Coffee Wing successfully listed on the New Third Board.

What drew even more attention from the outside world was its shareholder lineup—well-known figures such as "Fairy Sister" Yin Feng, variety show star He Jiong, Jumei Youpin founder Chen Ou, and 58.com chairman Yao Jinbo all appeared among the company's top ten shareholders.

Coffee Wing was thus regarded as a benchmark case of cross-industry dining.

In Yin Feng's understanding, Coffee Wing's development relies on four core words: "IP" and "crossover" form its influence in segmented markets, while "data" and "capital" are the driving forces supporting sustained operations and long-term development.

At a time when competition in the catering industry is becoming increasingly fierce, how exactly should catering companies break through?

On April 28, Coffee Wing founder Yin Feng gave a speech titled "The Capital Path of Cross-Industry Catering Driven by Data and IP" at the "2017 China Catering Investment and Innovation Story Session" hosted by Catering O2O.

Yin Feng's core viewpoints:

1. The new consumption era has fully arrived. Meituan data shows that the post-80s and post-90s generations contribute 70% to 80% of the entire market's consumption power.

2. The reason many catering companies dare to connect with the capital market and become public companies is precisely because opportunities for refinement, standardization, and legalization in China's catering industry have emerged.

3. It took 17 years of effort to develop an internal management system for catering management. At present, this system can achieve full automation in ERP, SCM, COPM, OPM, and other links.

4. Adopt the strategy of product personification and weekly product changes, giving every newly launched product a new identity and transforming conventional ways of expressing products into gamified, personified forms of expression.

5. You must play together with users. Because only by having users can you have the market, and only then can you have the future and development trends of the brand.

The following is an excerpt from the transcript of Yin Feng's speech:

1

The arrival of the Catering 3.0 era

The timing for catering companies to go public is mature

In 2017, all market data are predicting that China's catering industry will exceed 4 trillion.

The capital market is also bullish on the catering market. So many emerging catering companies received investment last year, all of which shows a favorable effect.

In the matter of business development, developed countries are certainly half a step, or even one to two steps, ahead of developing countries. In the United States and Japan, in terms of business infrastructure, their past may be China's present, and China's future is their present.

1. The arrival of the 3.0 internet brand marketing era.

When catering develops into the 3.0 era, how to continuously replicate the model and achieve stable growth requires us to make joint efforts in supply chain and marketing, establish our own true brand, and capture users' minds. Because brand is the final choice of credibility.

The new consumption era has now arrived. From Meituan's data, we can see that the post-80s and post-90s have become 70% to 80% of the entire market's consumption power.

This generation of consumers is characterized by children born with a sense of security, without a crisis of survival, very confident, quick in making choices, following their feelings. If I like it and I am willing, I will not be kidnapped by price or other factors, and I am very loyal to myself.

2. The timing for going public is mature.

This is the trajectory of the international catering industry's development, from the single-store profit model to the replication of the chain profit model, then to supply chain support, and finally to connecting with capital, until ultimately becoming a major international brand.

Many catering companies dare to enter the capital market and become public companies precisely because the opportunity for refinement, standardization, and legalization in China's catering industry has arrived.

We also have the opportunity to establish in China many great, inheritable major brands like McDonald's, KFC, and Starbucks.

2

Two approaches in catering

Resource integration type, strategic layout type

Now the catering industry is divided into two approaches. The first is called the resource integration type.

It may not develop and produce products itself, but only act as a transporter of products. By integrating relevant resources well, it can conquer with the brand.

Under this approach, first understand what customers exist in the market and what their needs are. Customers will determine our direction, and the size of the market will determine the scale of the brand.

The resources around us determine the future territory of the brand. Whether a brand becomes a lasting brand depends on its endurance.

The second approach is called the strategic layout type.

It still uses products as the starting point and constantly refreshes the NPS value. NPS value refers to the value of users advancing and retreating. If the product experience is good, it will continue to spread, new customers become old customers, and old customers bring in new customers.

We have a very core super product move, which will determine our core users. On this basis, we constantly refresh the user experience, and traffic continues to grow.

When traffic continues to grow, it drives us to keep laying out and determines a larger territory. When many peers compete, users will certainly choose brands with credibility and influence, and thus we gain sustained endurance.

3

Coffee Wing's approach

"IP, crossover, data, capital"

Where should the brand's future direction go? As Yao Jinbo often says, in today's entrepreneurship and operations, there is no shortage of teams and products, or even funds; what is lacking is direction.

If the direction is wrong, no amount of effort will be effective. But if the direction is right, finding the most effective methodology and the best resource integration platform will lead to rapid explosion.

Many internet ways of thinking and approaches are worth learning from in traditional industries. Driven by this, what kind of approach did Coffee Wing choose? Let me share our approach with everyone.

1. IP approach: Who are we?

IP refers to intellectual wealth. For example, Fairy Sister is an IP, Xu Xiaoping is an IP, He Jiong, Yao Jinbo, and Du Haitao are IPs, and in the end even Coffee Wing becomes an IP.

At that time I thought the United States then would certainly become China. As civilization develops, China would also need a social At that time, foreign cafes had two models: one was the small cafe like Starbucks, with a relatively simple structure, and the other was a meal-replacement cafe.

Once this model was established, we have kept insisting on it until now. What we focus on is the ability of brand culture to connect with customers, while products are only the physiological functions customers can satisfy in a cafe. What we have always been doing is brand output work.

Investors positioned us as China's number one entertainment coffee brand.

Starting from the lifestyle of coffee, we use cultural creativity, pan-entertainment, consumption upgrading, and chain replication to build China's own coffee brand.

China's catering market is 3.5 trillion, while the coffee market is only 70 billion.

Of that, 20 billion is premium coffee in cafes like ours, and 50 billion is the instant coffee market. China's 70 billion market so far has no very clear NO.1 brand, except for the foreign Starbucks.

And I personally have always felt that Americans are not necessarily so easily able to understand Chinese people's real needs. We know that only by understanding users can we build a brand with sustained endurance.

At that time we made up our minds to become Chinese people's true third space, entering through a social category like coffee.

2. Crossover approach: coffee light meals + celebrities

Industry advantages, growing demand, the rise of users, and capital trends are greatly related to the changes in the core consumer groups I mentioned. The rise of the post-80s and post-90s means their lifestyle has already become internationalized.

If we have post-90s or post-00s in our families, these children are completely different from us when choosing consumption scenarios. They prefer to choose where to be and with whom, rather than what to eat.

If it is about what to eat, what they choose is good-looking, fun, interesting, and unique, rather than truly very delicious. This all shows that the target group is changing.

These young consumer groups are changing, so the rise of the coffee market is very fast, with annual growth continuing at 20%.

We have two characteristics. First, celebrity userization.

For example, Teacher He, Haitao, Jinbo, Chen Ou, and Xu Xiaoping. My partners have one trait: they especially love life and have a childlike heart.

People who love life in this way will certainly love their own careers and will be ecstatic about every change in user experience.

Every celebrity is especially keen on the field of fashion. When they convey their keenness and perception of life, we will push it to all stores at the fastest speed, and thus celebrities become our most core influential users.

2. User celebrityization

Many customers choose Coffee Wing sometimes not because they like celebrity IPs, but because they want to have the same quality life as these IPs.

So they choose to come to Coffee Wing. Therefore Coffee Wing's slogan is "We are together." Celebrities and users are homogeneous and on the same frequency. In their hearts there are no idols; they themselves are the bosses, and we are just being ourselves.

3. Leverage marketing: trends, the internet, celebrities

On the IP path, we also do a lot of marketing. For example, Big Shot Takeout is a brand we incubated. We had Chen Ou drive his Porsche and Du Haitao deliver the first takeout order for this brand.

The emergence of the internet has added wings to all traditional industries. We do not need to fear them; we should use them at the lowest cost and with the fastest speed and efficiency.

We often combine trend-based topical events with the internet and celebrities, doing offline member activities and online promotion.

Celebrities guide users' consumption direction. Celebrities and users are homogeneous and on the same frequency, making users feel more present. This is more suitable for the post-80s, post-90s, and post-00s, to be themselves.

4. Product-driven: personification, peripheralization

We use product personification and weekly product changes. We give every newly launched product a new identity and turn the conventional way of expressing products into a gamified, personified way of expression.

Product peripheralization means that in addition to the products on the table, we also precipitate the products of the space and customers' consumption habits into our system, extending the first, second, and third consumption upgrades all the way into customers' lives.

This includes derivatives such as throw pillows, phone cases, and key chains. Women have one characteristic: the habit of buying on impulse. In today's consumer market, 80% of the direction is decided by women.

5. Scenario-driven: the city's third space

What we have always been doing is the city's social platform, the third space, so we create the scenario like a small oasis in a concrete jungle, not a purely functional cafe or restaurant.

This is our morning series, in a space of 350-450 square meters. This is the light luxury series, 200-300 a day.

6. Member-driven: play with users

As mentioned earlier, we often do various interactive activities with members. It has to be fun and interactive.

When the cafe opened, the location was not an A-class site. How to quickly ignite customers? So we designed a piece of software. There were many fences in the center of Sanlitun, and we tied 2,000 cups on them, with wings and scan codes on the cups.

White-collar workers coming to work in the morning would be very curious, and everyone would scan them.

We would give them a password telling them that if you take this cup to the cafe across the way, you will unlock the rights this cup possesses.

You must play with users. Because only by having users will you have the market, and only then will you have the future and development trends of the brand.

- END -

Source | Catering O2O

The above content is compiled by CoffeeHunters, a coffee news website.