The Use of the SWOT Model to Analyze the Success of CHAGEE

Brand Marketing Strategy

Shunjie Wang

School of Management, Tianjin University of Technology, Tianjin, China

Keywords: SWOT, Modle, Brand, 4 Pteory, New Chinese Style Tea Drink.

Abstract: In recent years, with the increasing popularity of the catering service industry, the sudden rise of the milk tea

industry, milk tea is deeply loved by the majority of young people, and has become the most popular topic at

present, this paper is an analysis of the success of the marketing strategy of the milk tea brand CHAGEE.

Price strategy, publicity strategy, and channel strategy, through which people can get the success of its

marketing strategy, its unique way of brand culture shaping, brand differentiation, and product market share,

brand differentiation and a large number of market research to draw customer tendencies, brand publicity

methods and marketing methods, and finally the future suggestions for the CHAGEE brand, to focus on

improving the quality of products and services.

1 INTRODUCTION

In recent years, with the vigorous development of the

beverage market, milk tea has gradually become a

fashion in young people's lives (Filo, 2011). The

emergence of new Chinese tea has also promoted the

development of tea culture (Xu, 2024). Therefore,

there are a large number of milk tea brands in the

market, the potential of the milk tea market is huge,

but the pressure is also huge, in the competitive

environment of the market, some milk tea brand

popularity shows a polarized trend, only a small

number of brands can get a high degree of attention

and market favor, mainly due to the effective

accumulation of its brand equity and the full release

of market value. These brands often show excellent

performance in multiple dimensions such as brand

positioning accuracy, product quality control, brand

communication strength and effect, brand value

building, and brand innovation ability, successfully

attracting consumers' attention, meeting their needs

and shaping a good brand experience, thus forming a

positive cycle of brand potential energy. From the

perspective of brand management professionals,

those brands that are gradually marginalized by the

market may have many problems in brand strategic

planning, brand core value transmission, product

market adaptability and marketing communication

effect, resulting in the brand being unable to

effectively meet the needs and expectations of the

target market, and gradually losing its competitive

advantage and brand vitality in the market

competition, which ultimately leads to the shrinking

market share and the continuous decline of brand

attention to disappear in the market.

Therefore, an in-depth analysis of the reasons

behind the success of the brand can not only reveal

the core logic of brand building, but also have

important reference value for the future competitive

strategy of the milk tea market. At the beginning of

this study, the basic dimensions such as the industry

background, development process, and market

structure of the brand will be systematically

elaborated, so as to provide a solid theoretical and

practical basis for subsequent in-depth analysis.

Then, the SWOT analysis method was used to carry

out a comprehensive strategic assessment of the

overlord tea queen. In-depth combing of its internal

advantages, such as product features, brand image

building, Identify weaknesses, such as operational

shortcomings, market coverage limitations, At the

same time, it has accurate insight into the

opportunities brought by the external environment,

such as the trend of consumption upgrading and the

rise of emerging markets, and potential threats, such

as fierce competition, changes in policies and

regulations, Through this analytical framework, the

current status of the brand is clearly outlined, the

future development opportunities are accurately

Wang, S.

The Use of the SWOT Model to Analyze the Success of Chagee Brand Marketing Strategy.

DOI: 10.5220/0013986300004916

Paper published under CC license (CC BY-NC-ND 4.0)

In Proceedings of the 2nd International Conference on Public Relations and Media Communication (PRMC 2025), pages 79-83

ISBN: 978-989-758-778-8

identified, and the risks and challenges faced are fully

revealed.

Then, the classic 4P marketing theory was

introduced, and the CHAGEE tea was deeply

analyzed from the four dimensions of product, price,

channel and promotion. product characteristics was

analyzed , pricing strategies, channel layout and

promotion methods in detail, and compare them

horizontally with the representative tea and beauty to

explore the similarities and differences between the

two in marketing strategies. Based on the above

research, this paper summarizes the successful factors

of CHAGEE marketing strategy, such as product

innovation and accurate brand positioning. Finally,

based on the research conclusions, constructive

suggestions are put forward for the future brand

development path of CHAGEE Lady, so as to help it

continue to develop steadily in the highly competitive

tea market and maximize the brand value.

2 BRAND INTRODUCTION

In 2017, CHAGEE was born in the world's tea

hometown - Yunnan at the beginning of its birth,

since then CHAGEE has insisted on using good tea

and good milk to make tea that is friendly to the health

of the body, presenting a cup of refreshing and non-

greasy, can drink the original leaf fresh milk tea for

tea lovers, "make the tea in the bones" is the belief

that CHAGEE has always adhered to, CHAGEE

takes the original leaf fresh milk tea as the main

product, covering pure tea, fresh fruit tea and related

derivative products around it, combining oriental

culture and tea inheritance and innovation to create a

new oriental tea shop (Zhang, 2024).

2.1 Brand Culture

With tea friends, the country has boundaries, and tea

has no boundaries, and the present study this paper

are committed to creating the best innovative milk tea

that belongs to the Chinese people, connecting the

world with Chinese tea to spread Chinese tea culture

to people all over the world, and is committed to

representing Chinese tea to become a new oriental

culture.

2.2 Development History

November 17th, the seventh anniversary of the

establishment of the CHAGEE brand. 2021 is an

important turning point for CHAGEE: in June, it

moved its headquarters to Chengdu, the "Western

Milk Tea Capital", and simultaneously launched the

brand 2.0 upgrade. Three months later, it opened its

first flagship store in Chengdu Chunxi Road with a

new brand identity. In October, it officially

announced two rounds of financing totaling 300

million yuan, and began to enter the field of vision of

mainstream business media.

In 2023, CHAGEE will become a phenomenal

new tea drink brand. According to Frost & Sullivan,

among China's ready-made tea brands in 2023,

CHAGEE will only rank fourth with 10.8 billion

yuan. At this time, the number of stores of CHAGEE

was less than half of the top ones.

The new tea drink knockout round is speeding up,

and the overlord tea girl continues to run hard. In the

first quarter of this year, the GMV of CHAGEE

exceeded 5.8 billion yuan, and the GMV target for

2024 is 20 billion yuan. As of May 20 this year, the

number of registered members of CHAGEE has

exceeded 130 million, and the number of registered

members has doubled in less than half a year. In July,

CHAGEE opened its global headquarters in

Shanghai, and its ambition to become a global tea

brand was undoubtedly revealed.

3 SWOT ANALYSIS OF CHAGEE

AND TEA BEAUTY

3.1 Analysis of the Advantages of

CHAGEE

China is the birthplace of tea culture, and Chinese

consumers have cognitive resonance with traditional

Chinese tea culture, and prefer to promote the "new

Chinese" tea drink that promotes Chinese tea culture

compared to other tea products that lack cultural

connotation, and the new Chinese tea drink occupies

a place in the Chinese tea market, combining ancient

Chinese culture and history with milk tea to make it

unique, and integrating elements such as opera

costumes, traditional embroidery, seal carving and

woodcarving into the brand logo (Yao, 2024). The

store design also has the characteristics of the national

dynasty (Jing, Qing & Zhao, 2024).

Compared with the unique advantages and market

advantages of Chayan Yuese, CHAGEE: The market

of Chayan Yuese is mainly concentrated in Hunan,

and CHAGEE has a large number of distribution in

various provinces, with more than 3,700 stores,

covering 282 cities in 31 provinces, while there are

only more than 500 and covering 13 cities in 5

provinces.

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Advantages of business model: CHAGEE coffee

table adopts the model of direct sales and franchise,

and Chayan Yuese is a pure direct sales model, so

CHAGEE quickly occupied the mid-end market and

quickly seized a large number of market shares

(Zhang, 2014).

3.2 Analysis of the Disadvantages of

CHAGEE

According to the survey, the sales volume of its

signature products accounted for more than 35%, and

the over-reliance on a single product led to the lack of

innovation of other products. The positioning of the

product price, the unit price ofs CHAGEE products is

between 15 and 20 yuan, and the price is more

expensive than ordinary milk tea, so it is necessary to

ensure the reliability and health of raw materials, and

at the same time, it must also have strict requirements

for its own service and environment, but it is

inevitable to face the problem of ultra-rapid

expansion.

3.3 CHAGEE Opportunity Analysis

With the support of the current domestic policies and

the promotion of the domestic "Belt and Road"

initiative, China's international influence is

increasing, which provides an important foundation

for the internationalization of Chinese products, and

the test of CHAGEE in Southeast Asia has achieved

great success, which provides a positive signal for the

future promotion to the world.

The advanced concept of the company's founder,

is committed to building CHAGEE into another

"Starbucks", A Starbucks belonging to China,

the brand must have the courage to go out, it is

obvious that CHAGEE has and dare to fight.

People's pursuit of health, in recent years, people

pay more and more attention to the health of the diet,

high-quality raw materials and professional material

processing, to ensure the health of CHAGEE drinks,

and according to the poll more than 60% are willing

to spend more money on the same type of health

drinks, this is undoubtedly a huge opportunity

(Huang, 2024).

3.4 CHAGEE Threat Analysis

The "threat of potential entrants" refers to the fact that

while CHAGEE Season has taken the majority of the

20 yuan milk tea market, there is still a risk that other

emerging competitors may enter the market and pose

a challenge to existing businesses. Even if CHAGEE

has a large share of the current market, due to the

attractiveness of the market and relatively low

barriers to entry, other companies may still seek

breakthroughs in price, product innovation or brand

strategy, thereby dividing market share and bringing

competitive pressure.

At the same time, competitors within the industry,

such as brands such as Mi Xue Bing, also pose a

significant threat. With its product innovation, brand

recognition or marketing methods, Mi Xuebing can

attract the same consumer groups, and then compete

with CHAGEE for market share. Due to the ever-

changing consumer demand in the milk tea industry,

the entry of competitors may lead to more

competitive markets, which will affect the

profitability and market position of CHAGEESeason.

In summary, although CHAGEE Tea Season has

dominated the market, potential market entrants as

well as existing competitors may still pose a threat to

it through differentiated competition, which in turn

will affect its market share and future growth.

4 4P ANALYSIS

4.1 Product Strategies

By differentiating itself by using raw leaf fresh milk

instead of fruit tea, CHAGEE aims to enter the

vacuum market that has not yet been fully occupied

and meet consumer demand for high-quality

beverages. In addition, CHAGEE also focused its

resources on promoting the flagship product "Boya

Juexian" through the "Big Single Product Strategy",

which is based on extensive market research and

customer feedback, with the goal of quickly attracting

consumers' attention and driving sales. In order to

increase the brand's appeal, CHAGEE also launched

a packaging design with Chinese characteristics, so as

to enhance the brand's recognition and resonate with

the cultural identity of consumers (Shi, Yang & Yu,

2021).

4.2 Price Strategies

CHAGEE is positioned in the mid-end market of 15-

20 yuan, and no national head brands have emerged

in this price segment, so CHAGEE can quickly

occupy a large market share in this relatively

unsaturated and huge market space. Its price strategy

not only takes into account the purchasing power of

consumers, but also ensures the high quality of

products and brand image, thus establishing a strong

competitive advantage in the market.

The Use of the SWOT Model to Analyze the Success of Chagee Brand Marketing Strategy

4.3 Channel Strategies

Bawang Chaji has selected a large-scale store of more

than 200 square meters in the channel layout to

improve the market coverage and popularity of the

brand. At the same time, the company carries out

large-scale replication on the mainstream store type

of about 260 square meters, and strives to enhance the

potential energy of the brand in the high-end business

district through accurate site selection. Despite the

high rent pressure, CHAGEE still maintains a high

queue rate and conducts social communication

through online channels, especially new media

platforms such as Xiaohongshu, to increase brand

exposure and user interaction (Wang, 2024).

4.4 Promotional Strategies

CHAGEE promotion strategy focuses on the

combination of precise operation and consumer

experience, attracting consumers through private

domain traffic management and offline interactive

activities, and enhancing brand stickiness and

engagement, so as to achieve the dual goals of sales

conversion and long-term customer maintenance.

Private domain traffic management: CHAGEE

establishes direct contact with customers through

channels such as store WeChat groups, and regularly

launches promotional information, such as weekly

discounts, exclusive discounts on members' days, this

method not only accurately reaches the target

consumers, but also strengthens user stickiness and

encourages repeat consumption through "loyalty

incentives". According to the theory of consumer

psychology, price concessions can effectively

stimulate purchase motivation, while the sense of

exclusivity further enhances customers' sense of

belonging and loyalty. Offline interactive activities:

CHAGEE co-branded with popular IPs (such as

"Tomb Robbery Notes") to hold themed pop-up

stores, as well as interactive promotions in

conjunction with traditional festivals (such as the

Mid-Autumn Festival), providing rich prizes and

games. This kind of activity caters to consumers'

needs for freshness, fun and social attributes,

reinforces brand impressions through immersive

experiences, and creates added value for customers.

The core of the promotion strategy is to meet the

affordable needs of consumers through online

precision operations, provide social and

entertainment value through offline activities, and

strengthen the connection between brands and

consumers. This two-pronged approach not only

increases consumer attention and engagement with

the brand, but also creates a higher repurchase rate

and market recognition for the brand (Yu, 2023).

5 COMPARATIVE ANALYSIS

WITH TEA AND PLEASANT

COLOR

In the tea market, CHAGEE and Tea Yan Yue Se

have their own characteristics, but CHAGEE has

obvious advantages. In terms of brand positioning,

CHAGEE focuses on high-end culture and quality,

accurately targets mid-to-high-end consumers, digs

deep into tea culture, controls quality details, and

establishes a high-end professional image. Although

the tea and beauty pay attention to the appearance

experience and the audience is young, it is slightly

weaker in terms of culture and quality.

In terms of price, CHAGEE is priced higher due

to high quality, matching high-end products and

services to provide a value-added experience for

consumers who pursue quality. The price of tea and

beauty is close to the people, focusing on the young

market, and it is difficult to meet the needs of the

middle and high-end.

In the channel layout, CHAGEE chooses a high-

end location, and the store design integrates culture

and aesthetics to create an immersive space and

highlight the high-end positioning. The layout of the

young people's active area and online is not as good

as the overlord tea queen in terms of space

experience.

In terms of promotion strategy, CHAGEE

emphasizes cultural connotation and cooperates with

art activities to enhance brand value and loyalty. The

use of entertainment promotion, in cultural

dissemination and high-end image building is slightly

inferior.

The two have their own characteristics, CHAGE

has won the recognition of the mid-to-high-end

market through its profound cultural heritage and

high-quality tea drinks, while Chayan Yuese has

attracted a large number of young consumers through

its appearance and youthful marketing methods.

Differences in business models CXAGEE adopts

the way of direct sales and joining, and Chayan Yuese

adopts the way of direct sales, and direct sales and

franchise are two different business models, and they

have some obvious differences in management,

operation, risk, Here are the main differences: Direct

marketing is suitable for businesses that want to

control their brand image, service quality, and

operational standards, and have enough capital to

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make large-scale investments. Under the direct sales

model, the headquarters has greater control, but it also

faces higher capital risks and expansion restrictions.

Franchise is suitable for businesses that want to

accelerate brand expansion with external funding and

resources. Under the franchise model, the

headquarters can obtain stable franchise fees and

management fees, and the expansion speed is

relatively fast, but it also needs to rely on the

execution of franchisees, and may face the risk of

inconsistent brand image and increased management

difficulty (Mo, 2017).

6 CONCLUSION

In the context of the rapid growth of tea brands and

increasingly fierce market competition, the brand

development of CHAGEE must carry out in-depth

market analysis and strategic planning. Through

SWOT analysis, this paper can clarify the advantages,

disadvantages, opportunities and threats of CHAGEE

in the market, and further point out that the brand

must achieve sustainable development through

differentiated positioning in a highly competitive

environment. Specifically, CHAGEE should combine

its brand cultural characteristics, dig deep into the

needs of consumers, formulate innovative product

strategies in line with market trends, and at the same

time, accurately determine the main products and

marketing strategies through market research and 4P

analysis, so as to ensure that the brand can quickly

respond to market changes and seize new market

opportunities.

In order to stand out in the fierce market

competition, CHAGEE should take culture as the

core to enhance brand recognition and consumer

brand loyalty. At the same time, given the slower pace

of expansion of the direct sales model, brands can

accelerate market penetration through the franchise

model, quickly occupy the second- and third-tier

cities, and reduce operational risks. However, in order

to ensure the consistency of brand image and service

quality, the headquarters needs to establish a sound

franchise management system to ensure that the brand

maintains a high standard of operation and quality

control during the rapid expansion.

In addition, the success of a brand depends not

only on existing marketing strategies, but also on in-

depth market research, continuous adjustment of

product mix and marketing methods to continue to

meet the changing needs of consumers. A brand's

competitive differentiation will be key to maintaining

its long-term competitiveness in the future market.

Overall, the success of CHAGEE is the result of a

combination of factors, including precise market

positioning, innovative product design, effective

marketing strategies and flexible channel expansion.

In the future, brands should pay more attention to the

detailed needs of consumers, and promote the long-

term development of brands and the increase of

market share by optimizing user experience and

innovating service models.

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The Use of the SWOT Model to Analyze the Success of Chagee Brand Marketing Strategy