1. Bubble Tea Shops Group 5 David Chang Laure Watel Marek Herman
Vanessa Lam
Group 5

2. Introduction
In our observational study we decided to focus on bubble tea shops in Taiwan. Bubble tea (also known as pearl tea) was supposedly invented by a Taiwanese businesswoman in 1980s when she experimented with pouring sweet pudding and milk into tea.
The drink became a craze in Southeast Asia in the 1990s as well as later in Europe and the United States. While the popularity gradually faded in western countries, it is still very popular in and around Taiwan.

3. Introduction
Bubble tea shops can be found in all Taiwanese cities, some of the most popular brands are Chun Shui Tang, 50 Lan, Come Buy, King Tea, Share Tea, Tea Patea and Chatime. The shops and stands are so popular that you may often find two, three or even four next to each other on the same street.
One such street is 指南路 (Zhinan Road) in Wenshan District, Taipei directly opposite the National Chengchi University (NCCU). Three bubble tea shops can be found in one place: 50 Lan, King Tea and Come Buy.
This leads potencial customers to difficult decisions, we wanted to analyze these decisions and the reasoning behind them by comparing the 50 Lan and King Tea shops on this street.

4. Bubble tea in Taiwan
There are at least 20 more or less known bubble tea chains in Taiwan and much more individual often unnamed stalls and shops.
Most of the chains use some form of franchising - either fully or partially. Some brands own shops in the most attractive locations and allow franchising for other locations.
They mainly compete with each other but substitutes include: coffee shops (Starbucks, 85°), convenience stores (7/11, FamilyMart), breakfast stalls and others.

5. Brands in Taiwan King’s Tea 50 Lan Ten Ren Come Buy Share Tea Chá Time
Chūn Shuǐ Táng
CoCo
Ching Shin
King’s Tea
50 Lan

6. King Tea
King Tea was founded in 2006 in the third largest Taiwanese city, Taichung. As of 2014 it has over 240 branches and uses franchising for some of them. King Tea shops can be found mostly in Taipei, Kaohsiung, Taichung and other locations on the west coast of Taiwan. It is not active outside Taiwan.
King Tea profiles itself as a healthy and fresh alternative to some other bubble tea brands. In its promotions and marketing, it focuses on several key points - refreshing taste, quality green tea, fresh juices.
The main competitors are 50Lan (often found in the same block), Come buy, Ten Ren and others.
Financial statements or detailed information about involved persons is not publicly available.

7. King Tea Locations
King Tea shops have a green signage and employees wear green uniforms. The shops differ in size but there’s usually 2-3 employees present at one time and the preparation area is always visible to customers.
The menu is available in English only in some locations - near universities, tourist spots and downtown.
Their motto is “100%手調原味茶飲” or “100% hand-tuned flavour of the tea”.

8. 50 Lan
50Lan was founded in 1994 in Tainan City, Southern Taiwan. It is one of the oldest bubble tea shops and currently is the largest and most popular in Taiwan.
The founder, 馬瑞東 (Ruei-Dung Ma), started 50Lan alongside his family’s fried chicken business, first selling only milk tea in one location and later expanding both the product range and number of shops.
The name 五十嵐 (50Lan) originally comes from Japanese (Igarashi) and was chosen as it is easy to remember.
50Lan owns some shops and uses franchising for other locations. Pricing is different based on purchasing power in the area, franchisees can set the prices in a specified range. Usually the price per drink is slightly more expensive (5-10元) than competitors.
Unlike King Tea, 50Lan is also active outside Taiwan in Singapore (KOI), mainland China (1點點) and Indonesia (50Lan).

9. 50 Lan locations
50 Lan uses two main colors for its shops - yellow and blue. The shop size depends on location, however preparation area is always visible to the customers. Menu is available in English only in some locations. 50Lan’s English motto is “The Tea of Cool. Craving. Content.”

10. Store Locations (Taiwan)

11. Background summary 50 Lan (五十嵐) King’s Tea (清玉) 1994 in Tainan 500+
Founded
Branches
Strategy
1994 in Tainan
500+
customization possibilities for every drink.
Slightly (5-10元) more expensive than most competitors
Largest, most popular chain
franchising
expanding outside Taiwan
2006 in Taichung
240+
Promotes its products as fresh and healthy
Also offers a lot of juices
Copies 50 Lan in some aspects
active in Taiwan only
50 Lan (五十嵐)
King’s Tea (清玉)

12. Products - 50 Lan

13. Product/Brand Descripton - 50Lan
Business places an emphasis is on customer satisfaction and provide better drinks in the long run using the best ingredients
Service is quick similar to King Tea across the street. Prices range from 30-50nt
Products are a variety of teas, lattes, milk tea and juice.
The drinks also has a large emphasis on Green Tea ingredients.

14. Customer Description - 50 Lan
Especially during the peak lunch hour, most of the patrons at this location consisted of college and high school students
Patrons who are outside the demographic above appear sporadically (1/5) and are ususally senior citizens, office workers on the go, and children with their parents.
Customers are always on the go. There is no seating in the shop.

15. Products - King Tea

16. Product/Brand Description - King Tea
According to the Facebook page, King Tea’s mission is to make the best bubble tea available to its customers in the best quality
Specializes in Milk Tea (for the younger customers) and Lemon Tea (for the older) along with many different Bubble Tea varieties
Service is quick and the drinks are prices range from 30-50NT, similar to 50Lan

17. Customer Description - King Tea
Also due to its location near the NCCU campus, most of the patrons at King Tea are college students.
Customers outside the student demographic also purchase drinks, but less frequently than the students
Patrons come and gone since there are no seating or tables at the tea shop.
The younger crowds prefer Milk Tea and the older crowds drink Lemon Tea

18. Analysis of the purchase: our process
Questions asked to customers :
What have you ordered ?
Do you usually order this drink or do you change often ? Why ?
How often do you come to this shop ?
Why did you come to this shop (50lan/King tea) and not the other one ?
Do you think this bubble tea shop has a lot of choice ?
How is the customer service ? Do you like the shop's atmosphere ? Are you satisfied ?
Did you find this shop alone or did friends tell you about it ?
Where are you going to consume your bubble tea ?
How often do you consume bubble tea ?

19. Analysis of the purchase : 50 Lan Statistics
Drink ordered
Milk Tea (green, black) : 62,5%
Fruit Tea (lemon tea etc) 25%
Smoothie 12,5%
Frequency of consumption
of this drink
Always this drink 50%
Often change 50%
Consumer status
Regular 87,5%
First time 12,5%
Reason of the choice of 50lan
instead of King Tea
Think 50lan is better (price, product, choice, atmosphere) : 37%,
Depends of the drinks ordered : 37,5%
Just satisfied with 50lan/don't want to try other ones : 25%
How consumer know about 50lan
Friends told about it 75%
Consumer found by himself 25%
Place of consumption
School 75%
Home 25%

20. Analysis of the Purchase : 50 Lan
50lan also have a great majority of regular customers.
There is two reasons for that : people are attached to the sweet taste of 50Lan so they just want to return there.
As we saw on statistics, half people also change their drink often : 50lan has a lot of drink choice so it is easy for people to change drinks. Pictures of more popular as well as some more original drinks are displayed on huge signs.
The first impression of the shop, by passing in the street is the more crucial point.
Bubble tea shops are by the street : the challenge for them is to make people stop. 50lan is using very bright colors -yellow and blue- to attract people's attention. Some customers said to us this was the main reason why they stopped the first time. As a matter of fact, we noticed that a lot of exchange students from NCCU come to this shop : they chose this place because it seemed as the more noticable one in the street.
Taiwanese students know this place thanks to fellow students and their friends.
Thanks to this coůbined points, the're always people lining at 50lan – especially at lunch time – and it convinces other people to stop to try as they think the place must be good. In Taiwan especially, a busy place is well considered.
The school context is also essential : in Taiwan, students can just consume their bubble tea at school because teacher accept this. It is a key factor of bubble tea shops near NCCU. As a matter of fact most people go to school to consume.

21. Analysis of the purchase : King Tea Statistics
Drink ordered
Green/black/milk tea: 64%
Bubble tea: 27%
Other: 9%
Frequency of consumption
of this drink
Always this drink 73%
Often change 27%
Consumer status
Regular 72%
Non-regular: 27%
Reason of the choice of King Tea
instead of 50Lan
Think KingTea is better (price, product, choice, atmosphere) : 27%,
Depends of the drinks ordered : 36%
Other reason: 36%
How consumer know about King Tea
Friends told about it 82%
Consumer found by himself 18%
Place of consumption
School area: 54%
Home: 18%
Elsewhere: 27%

22. Analysis of the purchase : King Tea
According to the customers' answers, most of them are regular customers of King Tea.
As said in the shop's description, King Tea's goal is to propose a great variety of bubble drinks (the famous bubble milk tea being included) but to focus on strong green tea.
From our observations, King Tea's desired positioning on the bubble tea market fit perfectly with the perceived positioning.
As a matter of fact, the reason why King Tea's customers attached great value to King Tea' goal to promote natural green tea's taste. They don't hesitate to go to King Tea because they find the taste of 50lan to sweet.
Customers already know what they will order. The choices for drinks are nevertheless displayed at several places in the shop -behind the sellers and on the counter – to help indecise customers.
The atmosphere of the shop doesn't seem to play an important role is the purchasing process : people don't really attach great importance to the physical aspect of the shop because they don't spend a lot of time in it. However one can notice that the choice of color – green – match with the focus on green tea.
King Tea has just opened last august so there are less customers than in 50lan : as a consequence, sellers have more time for each customer and there is almost no waiting time. Such a situation is two-edged : some customers just stop when they see there is nobody as they will obtain their drink fastly, and some others see this lack of customers of a sign a bad quality. In Taiwan especially, a busy place is well considered.
Some customers might think they know of a better place, some others the place is really not popular and it isnt worth it.

23. Factors in Decision Making
Price
If taste and availability of drink is equal consumers will choose the store with the lower price
However, if taste is not equal consumers will pay for the better tasting drink
Taste
Consumers prefer the shop more suitable to their taste buds
For King’s Tea, consumers liked them better because they are less sweet then 50 Lan
For 50 Lan, consumers thought their boba tasted better than King’s Tea.
Type of Drink
Depending on what type of drink the consumer wants, that will decide what shop they go to.
Consumers thought that King’s Tea had better tea drinks, while 50 Lan had better milk tea drinks.
So if they wanted a tea drink they go to King’s Tea. If they want a milk tea drink they go to 50 Lan.
Convenience (Location)
Consumers often tend to pick the location that is cloesest to them or most convenient for them to get to.

24. Factors in Decision Making
Recognition
If consumers do not where to go they usually go to shop that is more popular or recognized
50 Lan is a very well known Bubble Tea shop in Taiwan so most people already know the shop
Also it is located everywhere with many shops so people often see it and will try it from seeing it so often
Recommendation
Consumers often listen to and trust the recommendation of friends
Most consumers discover places through recommendations.
First Visited
Consumers typically stick to the first shop they tried
If they tried it for the first time and it is good they will continue going there without the need to find another place
They think the place is good and have no desire to try a new place
Unless recommended by a friend to try a new place or just so happen to try a different place that day by themselves they will stick to that shop and think its the best.
Accustomed
Some consumers have been going to the same shop their whole life so that’s why they continue to go there
They get used to going to that shop so they have no desire to go elsewhere.

25. Conclusion
Although there are two competiting bubble tea shops right across the street from each other they position themselves very differently to consumers to separate themselves
King’s Tea is a all natural more healthy option
50 Lan is a more typical bubble tea shop
So despite being across from each other they still attract their own loyal consumers

26. Questions?