Products, store presence keep 7-Eleven's City Cafe ahead of Starbucks

Taipei, Oct. 20 (CNA) Starbucks may have the more recognizable name, but 7-Eleven's City Cafe remains the king of Taiwan's fresh coffee market, helped by the convenience store chain's extensive market presence and product diversification.

President Chain Store Corp. (PCSC), which has both 7-Eleven and Starbucks in Taiwan under its corporate umbrella, launched the City Cafe brand in 2004, and it took off after actress Gwei Lun-Mei (桂綸鎂) began serving as its spokesperson in 2007.

City Cafe's sales exceeded NT$10 billion (US$311.17 million) for the first time in 2015, surpassing the revenue of Starbucks Taiwan at the time, and rose to above NT$17 billion in 2023, topping the NT$14.98 billion in sales posted by Starbucks Taiwan.

Those figures, confirmed at PCSC's investor conference last month, also far outpaced the growing fresh coffee businesses of other convenience store chains such as Family Mart and Hi Life.

Part of City Cafe's success is the popularity and extensive network of the 7-Eleven chain, and with the number of 7-Eleven stores expected to reach 7,000 this year, analysts believe City Cafe sales could hit a new high approaching NT$20 billion for all of 2024.

Diversifying its coffee brands has also paid dividends, according to PCSC.

Noting that City Cafe is celebrating its 20th anniversary this year, PCSC said 7-Eleven has extended its brand offerings from affordable coffee City Cafe to specialty coffee City Prima in recent years.

Having a range of products that makes its coffee appealing to all of its customers has helped City Cafe maintain its leading position in the freshly brewed coffee market, the company said.

Currently, Latte and Americano account for 40 percent of City Cafe sales each, while other flavored coffee drinks account for 20 percent, it said.

Another convenience store chain, FamilyMart, launched its Let's Cafe brand in 2006 and hired actor Mark Chao (趙又廷) to serve as its spokesman starting in 2009.

That business generated around NT$7 billion in revenue last year, with classic coffees and single origin coffees accounting for 45 percent and 55 percent of its fresh coffee sales, respectively, according to the company.

Hi Life is trying to carve out a larger share of the market, and spent up to NT$100 million in April 2024 to upgrade and refresh its Hi Cafe brand on the largest scale ever.

Hi Cafe generated NT$2 billion in annual revenue in 2023, and sales are up 50 percent year-over-year in 2024 to date, on pace to push sales up to NT$3 billion for the year as a whole, according to the company.