Belajar Dari Bisnis Teh 100 Triliun (Chagee, The Starbucks of Tea)

Summary

Chagi, a Chinese tea brand founded by Zang Junji, has rapidly expanded into a global premium tea company by focusing on high-quality products and customer experience, similar to Starbucks in the tea industry. With over 6,000 stores globally, Chagi’s success is driven by a streamlined supply chain, innovative use of AI, and strategic local partnerships. The brand has redefined the tea market by prioritizing experience over price, positioning itself in the premium segment. Chagi's journey highlights China’s shift from producing cheap goods to creating premium, experience-based brands, offering valuable lessons for entrepreneurs and international businesses.

Takeaways

• 😀 Chagi is a premium tea brand that has rapidly grown to 6,000 stores globally, positioning itself as the 'Starbucks of tea.'
• 😀 Chagi's success is driven by offering more than just tea—it focuses on providing an immersive customer experience and a lifestyle choice.
• 😀 The brand's core product is fresh tea leaves mixed with milk, setting it apart from cheaper, powdered alternatives.
• 😀 Chagi's business model emphasizes quality and consistency, with drinks prepared in just 8 seconds and a streamlined supply chain for fast inventory turnover.
• 😀 The founder, Zang Junji, rose from a store assistant to a billionaire in just six years, leveraging deep knowledge of the tea industry.
• 😀 Chagi's IPO on Nasdaq is a significant move, signaling ambition to redefine Chinese brands in the global market amidst geopolitical tensions.
• 😀 The company expanded globally by partnering with local experts like Era Jaya Group in Indonesia, adapting to local markets and cultures while maintaining control over branding and experience.
• 😀 Chagi’s focus on maintaining a premium market positioning is evident in its design, store ambiance, and consistent product experience, catering to urban professionals and students.
• 😀 Unlike other Chinese brands that focus on cost, Chagi prioritizes branding and customer experience, shifting the global perception of Chinese products from cheap to premium.
• 😀 The key lesson for local businesses is the importance of creating a strong brand experience, as product alone is no longer enough in the premium market.
• 😀 Chagi's success is also a testament to how branding, consistency, and customer experience can lead to rapid growth in international markets.

Q & A

What is Chagi's business model and how does it differ from other tea brands?

Chagi operates in the premium tea market, positioning itself as the 'Starbucks of tea.' Unlike other tea brands that focus on cheap products or trendy bubble tea, Chagi emphasizes high-quality tea with fresh leaves and premium experiences for customers. This strategy allows them to sell products at higher prices, targeting middle and upper-class urban customers.

Why did Chagi choose to focus on a premium market segment?

Chagi's founder, Zang Junji, noticed that while coffee had entered the premium market segment and became a lifestyle choice, tea had not seen similar growth. By focusing on premium quality, fresh ingredients, and an upscale customer experience, Chagi could fill this gap and create a unique identity in the tea market.

What makes Chagi’s tea different from other tea brands?

Chagi's tea stands out because they use freshly brewed tea leaves, not instant powder, mixed with fresh milk. This emphasis on high-quality ingredients and authentic preparation is a key part of their premium positioning, differentiating them from brands using cheaper, mass-produced tea products.

How does Chagi maintain product consistency across its many locations?

Chagi uses a streamlined supply chain model with a rapid inventory turnover rate. Each drink is prepared in about 8 seconds, and the entire process, from order to delivery, takes less than 40 seconds. This efficiency is supported by advanced technology, including semi-automated machines, to ensure consistency and quality at every store.

What role does branding play in Chagi’s success?

Branding is crucial to Chagi's success. The company focuses heavily on creating a premium, elegant experience that resonates with its target audience. The store design, product packaging, and overall atmosphere are all carefully crafted to align with the brand’s identity. This is similar to Starbucks’ approach, where the experience itself is as important as the product.

How did Chagi's founder, Zang Junji, build the company from scratch?

Zang Junji started his career in the tea industry by working as an assistant in a Taiwanese tea shop. Over the years, he gained valuable experience, rising through the ranks to become a regional manager. By 2017, he founded Chagi with the vision to create a tea brand that had soul and culture, not just a product. His deep understanding of the tea industry helped him build Chagi into a successful global brand.

What is the significance of Chagi’s IPO on Nasdaq?

Chagi’s decision to IPO on Nasdaq, rather than in China, was a bold move that demonstrated the founder’s ambition to make the brand a global player. The IPO also took place during a time of heightened geopolitical tensions between China and the US, signaling that Chagi was ready to compete on the world stage and change perceptions of Chinese brands.

Why did Chagi choose to expand internationally with local partners?

Chagi’s international expansion strategy involves partnering with local companies like Era Jaya Group in Indonesia. This approach ensures that Chagi’s products and brand are tailored to the local market, from understanding customer behavior to navigating legal requirements. The use of local partners also helps Chagi mitigate risks and maintain quality and consistency in new markets.

How has Chagi tailored its marketing strategy to the Indonesian market?

In Indonesia, Chagi has leveraged influencer marketing to target urban, middle-class consumers. By inviting influencers to promote the brand, Chagi taps into the social media-driven culture of Indonesia. The focus is on promoting the lifestyle aspect of the brand rather than just the product, which helps create a stronger emotional connection with customers.

What are the challenges Chagi faces as it grows and enters new markets?

As Chagi expands into new markets, maintaining a consistent customer experience is critical. Any service lapse, like an unprofessional staff member or a poor-quality drink, could damage the brand’s reputation. Furthermore, managing a global supply chain and meeting the varying demands of different markets presents ongoing challenges, especially in maintaining quality across all locations.