Inside Luckin Coffee, the Coffee Chain Overtaking Starbucks in China

• I visited the coffee chain that’s overtaking Starbucks in China.
• What stood out to me was how efficient — and impersonal — ordering was.
• Most customers said it wasn’t the flavor that stood out to them, it was the aggressive deals.

Starbucks is synonymous with coffee, but in China, it might just be losing some of its luster.

A Chinese coffee chain called Luckin Coffee recently overtook Starbucks in China, beating the international coffee chain in sales in the second quarter of 2023, the Wall Street Journal reported on Sunday.

Founded in Beijing in 2017, Luckin Coffee has staged a dramatic turn-around. It filed for bankruptcy in the US in 2021 after the fallout of an accounting fraud scandal. Today, company has over 13,000 branches, the vast majority of which are in China.

Singapore marks Luckin’s first international expansion outside of China — the first Luckin cafes opened their doors in the city-state in March. It now has more than 20 stores across the country.

Curious to see whether Luckin could live up to its Starbucks-killer hype, I headed over to a Luckin Coffee in Singapore’s central Chinatown neighborhood on Thursday afternoon.

Luckin Coffee and Starbucks did not respond to my requests for comment for this story.

Ordering my coffee was machine-like: technical, efficient and impersonal

The tiny Luckin Coffee I visited is located right next to Singapore’s central business district. It was buzzing with office workers when I arrived.

With a mere seven seats, bright lights, and minimal decor — as well as none of the familiar sound of baristas calling out orders — this Luckin felt more like a post office or a waiting room in a clinic than a cafe.

The next thing that struck me is that at Luckin, you can’t order at the counter. That’s even though the cafe had a counter with a menu displayed behind it, and four baristas working behind the counter. I tried to order face to face, and was told I have to order through the Luckin app instead.

The problem is that the Luckin app is not great.

At the time of writing, the app had an average of 2.5 out of 5 stars on the Google Play store for Singapore, based on just over 100 reviews, and it’s not hard to see why.

I downloaded the app at the cafe. When I opened it, I had to watch a three-second pop-up ad I couldn’t skip. And that’s not an outlier experience: The app regularly shoved intrusive pop-ups for vouchers and discounts in my face.

This conveyor belt-like efficiency drew a mixed reception from the customers I spoke to

I placed an order for one of their bestselling items, a coconut latte, for 0.99 Singapore dollars — or just over 70 cents. It’s a promotional deal for first-time customers. The drink normally costs SG$8.

And after a five-minute wait, my iced coffee was ready. The only words the staff members exchanged with me were when one of them told me to present my app’s QR code to collect my coffee. If not for that, the entire process would have been human-interaction-free.

A customer I spoke to, who arrived drenched in sweat after badminton practice, said that though he occasionally found the cashier-less system annoying — he recalled leaving once without coffee because he’d forgotten his phone — he was used to it. Being from China, he said, he’d seen all manner of retailers abandon cash for cashless payments.

But others I spoke to weren’t sold on the ordering system.

“I think it’s really annoying that you can’t buy at the counter, because sometimes your phone data is lagging and today, I’m in a rush to get back to work,” said Amanda, another customer who was waiting for her order.

For some, this efficiency is part of the appeal. Most customers didn’t dally, grabbing their drinks and heading off immediately.

Esther, an office worker, told me she loved the cashier-less experience — you never need to queue if you order in advance, she said.

Unusual flavors include “Big Cheese” and coffee-tea combo-drinks

One group of office workers I spoke to said they loved the variety of flavors and thought it was more extensive than what Starbucks offers.

The menu has some coffee flavors you’d expect, like matcha and coconut, and others you wouldn’t, like “Big Cheese,” watermelon, and “Yuanyang” — a coffee-and-tea combination that originates in Hong Kong.

To me, Luckin seemed like less of a Starbucks rival, and more like a budget-friendly alternative

A lot of the customers I spoke to said they didn’t think of Luckin as a competitor to Starbucks at all because Starbucks is so much more expensive. A Grande latte with no additional flavors at the nearest Starbucks costs more than SG$7.

My Luckin iced coffee was good, but it was nothing special. And among most of the customers I spoke to, it wasn’t the taste that drew them to Luckin: It was the deals.

“I’ve never gotten a drink here without a discount,” said Jeremy, a Luckin regular who was sipping on a matcha-flavored latte.

Another pair of customers said they same: They were here because of a promotion they’d seen on the Luckin app that offers two coffees for SG$10.

Luckin pushes those deals — hard.

I spent less than an hour at the cafe, and in that time, I received no fewer than a half-dozen pop-ups on the app. I got an ad for a “Watermelon Pink Latte” that would cost me SG$4.25 with a voucher. A follow-up ad told me that if I referred a friend, I could drop the price even lower to SG$0.99 for the drink.

And as Luckin’s exploding popularity shows, that’s a tough price to say no to.