What does it cost to open a coffee shop in a crowded drinks market?

A single drink price is not the cost of opening a shop, and the Duck Blood Vermicelli Milk Tea case from Nanjing shows why. The shop priced its chocolate-pudding and sweet-noodle novelty at 16 yuan, roughly in line with ordinary milk tea, while the drink drew more than 50,000 posts on Xiaohongshu. Startup costs sit in rent, equipment, staff and marketing, not in one cup.

China's freshly made tea market reached 113.6 billion yuan in 2020 and is projected to reach 340 billion yuan by 2025, which explains the pressure to stand out. Brands keep pushing gimmicks, regional fruits such as oil mandarin and wampee, and whole-leaf brewing. A shop selling coffee brewed with milk faces the same math: the concept wins attention, but lease terms, fittings and payroll decide whether it survives.

A local milk tea shop in Nanjing launched a realistic-looking "Duck Blood Vermicelli Milk Tea," sparking heated discussion online. Although the product is named after duck blood vermicelli, it is actually made with chocolate milk pudding to simulate duck blood and sweet noodles to serve as the vermicelli, priced at 16 yuan. There are over 50,000 related posts on Xiaohongshu, with netizens commenting that it "sounds bizarre but unexpectedly tastes good." This phenomenon reflects the fierce competition and innovation anxiety in the new-style tea beverage market. From mini milk teas to niche fruits such as oil mandarin and wampee, and then to the revival of whole-leaf tea, major brands are competing for consumers through gimmicky products, regional specialty ingredients, and traditional brewing methods. Data shows that China's freshly made tea beverage market reached 113.6 billion yuan in 2020 and is expected to reach 340 billion yuan by 2025. This article will analyze the market logic and consumer trends behind these creative marketing efforts, and also pay attention to the moves of professional brands such as Front Street Coffee in the industry.

"To open a milk tea shop, the most critical step is probably giving it a name with soul."

A local milk tea brand in Nanjing proved this point—they launched a product called "Duck Blood Vermicelli Milk Tea," as if kicking open the door to a new world.

Duck Blood Vermicelli Milk Tea??? Has the milk tea world really become this outrageous now?

First, let's see what it actually looks like.

Data on the Xiaohongshu platform shows that there are currently more than 50,000 posts tagged "Duck Blood Vermicelli Milk Tea," which shows that this novel drink is quite popular.

According to the introduction, "Duck Blood Vermicelli Milk Tea" is not literally made with duck blood, vermicelli, and milk tea; it only highly imitates the appearance of this Nanjing snack.

The so-called "duck blood" in the product is actually an imitation made from chocolate milk pudding, shaped very much like duck blood; while the "vermicelli" is indeed real noodles, except that it tastes sweet.

Amazing~ I have to say, the appearance is indeed made quite realistically.

In terms of price, this cup of "Duck Blood Vermicelli Milk Tea" sells for 16 yuan, not much different from the pricing of most ordinary milk teas on the market.

As for the taste, many netizens also gave positive reviews.

One netizen commented:

"From the appearance, this cup of milk tea really looks like duck blood vermicelli soup, but don't be scared off by its name."

"It sounds like dark cuisine, but it actually tastes unexpectedly good."

In fact, in addition to "Duck Blood Vermicelli Milk Tea," this shop has also launched other creative drinks such as "Cloud Top Duck Blood Vermicelli Milk Tea" (the shop really knows how to play).

According to data from the "2020 New-Style Tea Beverage White Paper": the scale of China's new-style tea beverage consumers has continued to grow since 2017, and is expected to reach 365 million people in 2021.

In addition, data from China Insights Consultancy also shows that the total market size of China's freshly made tea beverages in 2020 was 113.6 billion yuan, and is expected to reach 340 billion yuan by 2025, with a compound annual growth rate of 24.5%.

We previously mentioned in the article "Milk Tea Is Getting Smaller and Smaller" that on Chinese New Year's Eve this year, new-style tea beverage brands officially sprinted toward IPOs; on April 2 of the same year, Sexy Tea opened its first store in Shenzhen, and on the first day of opening it sparked trending topics such as #ShenzhenSexyTeaHas30,000PeopleInLine# and #ACupOfSexyTeaInShenzhenCostsMoreThan200Yuan#; later, in June, China Post began to enter the milk tea field, and long lines formed at the store when it opened, as well as cases such as "becoming the top in the country as soon as it opened."

The signal revealed by these cases is nothing more than "milk tea is hugely profitable" and China's new-style tea beverages have unlimited development prospects.

Faced with such an attractive market and the needs of different consumer groups, major milk tea merchants have also begun to open their minds, brainstorm, and make new innovations.

For example, mini milk tea suddenly went viral online.

Heytea, 1 Dian Dian, ChaPanda, Tea List Yishi, and others have all launched mini versions of milk tea. The tiny cup of mini milk tea instantly became a unique presence in the milk tea world, attracting everyone to go check in.

After that, regional niche fruits became one of the innovative ideas for new-style tea beverage brands.

The new-style tea beverage brand Nayuki used the niche fruit "oil mandarin" from the Chaoshan region to create "Domineering Jade Oil Mandarin," which after launch directly surpassed "Domineering Cheese Strawberry," long ranked first in Nayuki's sales.

Another major new-style tea beverage brand, Heytea, used "wampee" to create "Wampee Immortal Dew" and "Succulent Wampee Immortal Dew," which likewise sold nearly 60,000 cups just 3 days after launch.

After oil mandarin and wampee, the tea shop "ChaPanda" also used a new product, "bergamot," to create "Bergamot Lemon Tea."

After that, whole-leaf tea revived again. Heytea launched a hand-brewed tea series, which mainly focuses on China's six major tea types and presents them using traditional brewing methods.

On the increasingly popular track of new-style tea beverages, innovation is unavoidable if brands want to satisfy the needs of more consumer groups. On the one hand, novel products can satisfy consumers' curiosity; on the other hand, the huge tea beverage market has always been updating and iterating, and only by injecting fresh blood can faster development be brought about.

Whether it is Nanjing's Duck Blood Vermicelli Milk Tea, the popularity of mini milk tea, Nayuki's Domineering Jade Oil Mandarin, or Heytea's Wampee Immortal Dew/Succulent Wampee Immortal Dew/whole-leaf tea, the reason they can gain the market is simply that merchants are better at grasping the trends of consumer development and thus launching products more suitable for consumer groups.

Under such circumstances, more interesting tea beverage gimmicks in the time to come are already to be expected.

Image source | Xiaohongshu, Internet

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