Chinese love for milk tea pushes innovation

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03:23

Chinese of course have been making tea for thousands of years, but they've never seen it made this way before -- by a robot in the first self-service milk tea shop in Shanghai. The innovation is aimed at making this particular milk tea shop stand out from the thousands of others in the city.

The robotic milk tea shop is in a mall in downtown Shanghai, and if you don't like the service, there's no one to complain to. Scanning the QR code and ordering the tea on your mobile phone -- bubbling tea with just a little ice, and no sugar -- I'm on a diet. The little orange robot gets busy as soon as you've paid. Pressing "open" on your phone, and starting to enjoy your tea.

The self-service milk tea shop is an addition to the original tea shop. It opened at the beginning of the month and has boosted sales revenue by almost 10 percent. The mechanical barista serves about 100 customers each day -- much lighter work than it used to do in its previous factory job.

VCG Photo

The owner, Happy Lemon, has been around for more than 10 years, and the company's CEO Susan Lu admits the robot helper cost her so much that it will take a while to make back the investment. Still, the company hopes the innovation will make it more competitive with other tea brands in town.

“Milk tea is so popular now, and there are a lot of internet celebrity shops now. We were thinking about how to compete with them. Twenty-five to 30 percent of our orders is made online, while 70 percent are offline. Young people want yummy, cheap tea in an interesting atmosphere. And our self-service shop is really eye-catching,” Lu said.

Like Happy Lemon, other tea brands also are seeing most of their revenue made in offline shops, despite China's rapidly growing food delivery market.

A report from research company Mintel shows nearly all consumers in China prefer to buy their tea in physical stores. And that is why many tea brands, especially those that have been around for years, are putting efforts into offline innovations.

Many like Happy Lemon and COCO have recently changed their logos and redecorated their shops, trying to attract more customers. Even China's oldest milk tea brand Xiangpiaopiao, which became famous for selling instant tea, is now planning to open an offline shop.

“The target consumers of milk tea are aged from 25 to 29 years, and this group likes to try new things. They buy milk tea when shopping and dating. So the environment of the offline stores is definitely important to them,” said Belle Wang from Mintel.