Dragons drinking coffee: South Korean and Chinese coffee cultures.

Abstract

Today, coffee is one of the largest traded commodities in the world and an element of lifestyle, social cohesion and cultural identity. This thesis paper compares South Korean and Chinese coffee market, identifying common points and differences in consumption patterns, tradition, production with the purpose to understand and predict the evolution of Chinese coffee market. The choice of South Korea come from the old tea-culture and the Confucian society it shares with China. However, “the two countries are cousins, not siblings” (Doctoroff T., “What Chinese want”, 2012, Palgrave Macmillan, pag. 225). Despite the existence of common aspects, differences between the two countries show how Chinese coffee culture will have its own evolution. Chapter 1 presents a descriptive analysis of South Korean coffee culture, its historical background, followed by the study of the consumption patterns among young and old generations and some of the main coffeehouse chains in the market (Starbucks Coffee, Caffe Bene, Ediya Coffee). The Chapter ends with a description of Korean middle class as the driving social segment for coffee culture and the characteristics of the average Korean coffee consumer. Chapter 2 is about Chinese coffee market. After a historical background and a focus on the role that big foreign groups had in the economic development of production areas, the analysis focuses on Chinese middle class. Economic differences between first-tier and lower-tier cities force to a distinction in consumption patterns and consumers’ orientation. Furthermore, China’s growing coffee production capability in the areas of Yunnan, Hainan and Fujian represents one of the main differences with South Korea. The third Chapter starts with a short description of the Italian espresso tradition and the way it affected the world’s different cultures. The Italian coffeehouse chain Caffè Pascucci is taken as a study case for its ability to conform Italian style to over 25 countries, among which South Korea and China. In conclusion, the purpose of this paper is to understand the economic role that China will have in the world’s coffee industry in the future. Moreover, it aims at showing the role Italian firms can have in this reality, working on comparative advantages such as high quality and tradition, and making the required adjustments, in order to take advantage of niche markets and of a more and more experienced consumers’ base.