The Success of Luckin Coffee Digital Marketing from the Perspective

of STP

Jinghan Chen

, Zhenghua Chen

2,*

, Sihan Zhao

and Xiwen Zheng

The School of Journalism and Communication, South China University of Technology, 510006, China

Department of Marketing (Digital Marketing), School of Business Administration, Jiangxi University of Finance and

Economics, 330032, China

Suzhou High School of Jiangsu Province, 215000, China

Jiangxi University of Finance and Economics, 330032, China

＊

Keywords: Digital Marketing, Luckin Coffee, STP.

Abstract: In recent years, the global coffee industry has witnessed rapid development influenced by various factors, and

digital marketing strategies play a crucial role in its growth. This paper takes Luckin Coffee as the research

object and uses methods such as case analysis to analyze its digital marketing strategies. The research findings

show that Luckin has enhanced its brand image and expanded its market share through precise STP

positioning and diverse digital marketing activities, such as co-branded marketing. Its low-price strategy has

also attracted price-sensitive consumers. However, Luckin faces issues such as product homogeneity, vague

brand positioning, and low consumer stickiness. Some co-branded activities have even damaged the brand

image. The research concludes that Luckin needs to strengthen its brand positioning, optimize its pricing

strategy, conduct precise market research, and improve the user experience. Other coffee companies can also

draw lessons from this to expand their markets by optimizing their digital marketing strategies.

1 INTRODUCTION

The coffee industry has evolved significantly

worldwide in recent years, influenced by

globalization, consumer taste change, and successful

marketing strategies. In the global coffee market,

coffee shows noticeable influence: North America

and Europe are the biggest coffee consumption

markets; the Middle East and the Asia-Pacific region

rapidly expands the coffee market with high potential

while South America is the main coffee supply

market. The global coffee industry expands at an

incredible speed--In 2024, the coffee market size is

expected to reach USD 132.13 billion, and would

continuously reach 166.39 billion by 2029 by

prediction. (FHA Editor, 2024)This impressive

growth in market size and global influence is

inseparable from its effective digital marketing

strategies, and the coffee industry can benefit from

them in terms of learning consumers' lifestyle through

the database, helping it adapt to consumers’ rapid

changes in taste and producing trendy coffee products.

Moreover, the coffee market produces highly similar

products, so those producers need to differentiate

their coffee, gaining a unique competitive advantage

like home delivery by using these strategies. As

globalization develops, global awareness of the

environment and ethics has increased to an

unprecedented position, which requires them to build

an environment-friendly and ethical image towards

customers across the world in terms of building

customer loyalty, and digital marketing strategy

provides approaches to allow producers to build such

a brand image.

Academic discussion about coffee industry’s

digital marketing strategy is also endless, mainly

focusing on consumer preferences, technology, and

sustainability concerns. Digital marketing strategy

includes social media marketing, search engine

optimization, paid advertisement, mobile app

engagement and E-commerce, which effectively

assist expansion of the coffee industry from various

perspectives (Grant, 2021). For example, social

media marketing showcases coffee products to

consumers in the form of engaging their life, since

coffee ads would appear when they are checking apps

like TikTok and Instagram and introduce a perfect

lifestyle with coffee (Hidayat, 2022). Other digital

marketing strategies like e-commerce provide

190

Chen, J., Chen, Z., Zhao, S. and Zheng, X.

The Success of Luckin Coffee Digital Marketing from the Perspective of STP.

DOI: 10.5220/0013988200004916

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 190-195

ISBN: 978-989-758-778-8

convenience towards consumers in terms of making

purchases much easier online than physical stores.

Digital marketing strategy could target potential

customers in high intent accurately through search

engine optimization according to its tremendous

database.(Research Publish Journals, 2022) As a

result, digital marketing strategy is the key to the

success of the coffee industry, and analyzing these

strategies brings long-term benefits to the coffee

industry.

As one of the fastest growing and most promising

coffee brands in China, Luckin also uses various

digital marketing strategies. This paper will analyze

how Luckin achieves rapid market development

through using digital marketing strategies.

2 STP ANALYSIS OF LUCKIN

COFFEE

2.1 Segmentation

Luckin Coffee is expanding globally, with a focus on

opening stores in densely populated and high

spending areas such as core commercial districts,

office buildings, shopping centers, and universities in

first - and second tier cities, while also penetrating

into third - and fourth tier cities (Tao Li,2024).

Therefore, its target customers are mainly

concentrated in the age range of 20-40, mainly young

office workers and students. This group of people

pursue fashion and trends, value quality of life, are

willing to accept new things, have strong social

needs, and pay attention to consumer experience and

product aesthetics. In addition, they have a high

frequency of demand for coffee and have certain

requirements for coffee quality. They also pursue

convenient purchasing and fast delivery services,

prefer to consume through online platforms, and are

easily influenced by brand marketing activities.

2.2 Targeting

Luckin Coffee has chosen the younger generation of

consumers as its core target market. This group is

greatly influenced by social media and digital

lifestyle, with diversified and personalized

consumption needs, high acceptance of new things,

and emphasis on convenience and immediacy of

consumption. Luckin Coffee meets the coffee and

beverage needs of young consumers in different

scenarios, such as work, leisure gatherings, social

sharing, by providing diversified products,

convenient online and offline purchasing channels,

and rich marketing activities.

2.3 Positioning

Luckin Coffee shapes a brand image that is young,

fashionable, convenient, efficient, and cost-effective.

Luckin Coffee emphasizes the concept of "fast

fashion coffee". It allows consumers to enjoy coffee

anytime, anywhere through rapid expansion of stores

and efficient delivery services. Moreover, Luckin

Coffee actively collaborates with numerous IPs to

carry out various themed marketing activities, which

enhances the brand's topicality and influence and

helps establish a youthful, dynamic, and trendy brand

tone.

Luckin Coffee offers high-quality and diverse

coffee and other food products, including classic

coffee, creative blends, light desserts, to meet the

taste needs of different consumers. In terms of

packaging, Luckin Coffee focuses on the appearance

and packaging design of its products, creating a

fashionable and personalized product image.

Luckin Coffee's product prices are mainly

concentrated in the range of 15-30 yuan, and weekly

coupons are issued to customers to purchase a cup of

coffee for 9.9 yuan, which is at the mid to low end

level and differs from other high-end coffee brands

such as Starbucks (Jiang Mingjue,2024). It has a high

cost performance ratio, which can meet consumers'

demand for quality and meet the consumption ability

and price sensitivity of young groups.

3 THE ADVANTAGES AND

DISADVANTAGES OF LUCKIN

MARKETING

3.1 Advantages

Since its foundation, Luckin Coffee has made co-

branded promotions as one of its primary marketing

strategies. It has collaborated with major IPs across

various fields, including the stage play Dream of the

Red Chamber, the band Wutiaoren, and the game

Genshin Impact, launching a series of new products

and merchandise. The most phenomenal marketing

case was the launch of "Sauce-Flavored Latte",

collaboration with Moutai, which set a record of 100

million yuan in first-day sales and drove an 84.9%

year-over-year increase in revenue for the quarter.

The Success of Luckin Coffee Digital Marketing from the Perspective of STP

191

3.1.1 Setting Precise Market Positioning,

Meeting Public’s Curiosity

The widespread popularity of Sauce-Flavored Latte

can be largely attributed to its precise brand

positioning. Generation Z has grown up in an era of

highly developed internet and social media, exposed

to diverse, personalized, and unconventional ideas.

They have a strong desire for unique and customized

products. The "Sauce-Flavored Latte" combines fast-

moving consumer goods with luxury products,

creating a unique niche in the co-branded beverage

market. It caters to Gen Z's pursuit of creative drinks

and their curiosity about premium baijiu (Zhao &

Wang, 2024).

3.1.2 Using a Variety of Topic Marketings to

Promote the Product

Luckin Coffee conducted a multi-layered and

comprehensive marketing approach for "Sauce

Latte.", especially creating diverse topics on social

media to promote the product. During the UGC stage,

the brand launched an all-round topic marketing on

various platforms, while skillfully using buried

marketing to respond to critics, to improve discussion

and user engagement. For example, using "sauce latte

voucher after 19 yuan" to promote how cost-effective

the product is; using the topic "Will lattes be

recognized as drunk drivers" to combine the product

with social topics and create news events to attract

public’s attention and reports of official media; "The

chairman supervising the production process” to

response to users' doubts about the raw materials, and

highlights the brand's intentions and responsibility for

the production process.

3.1.3 Resonates with User Value, Takes

Social Responsibility

In addition to the classic topic marketing, the

marketing of "sauce latte" also accurately locates user

pain points, resonates emotionally with the

Generation Z, and causes the wide spread of UGC

content. The packaging slogan of "early A (alcohol)

late C (coffee)" is used to generate value resonance

with office workers, triggering users' sharing and

teasing behavior to improve brand exposure.

Moreover, Luckin successfully helped traditional

brands break through the shackles of small audiences,

let more young people have access to Moutai, a time-

honored brand, created a new road for many

traditional brands to attract young consumers, and

further improved the social value of brand co-

branding, enabling Luckin Coffee to become a

positive example of economic growth and corporate

social responsibility (Wang, 2024).

3.2 Disadvantages

3.2.1 Setting Precise Market Positioning,

Meeting Public’s Curiosity

According to the 2018-2019 Blue Book of Coffee

Consumption in China, 73% prefer lattes due to their

low caffeine content (10-20%), which means most

Chinese people do not accept "black coffee" with no

milk or sugar. After many attempts, Luckin Coffee

launched milk coffee products, differentiated its

products from traditional coffee brands such as

Starbucks, and its sales increased significantly,

becoming the leader on the milk coffee track.

However, in order to further expand the market,

Luckin added fruit tea, lemon tea, baked light food

and other products to their product list, which is too

close to the products provided by Coco, Starbucks

and other competitors. The high degree of product

homogeneity makes it lose its unique competitiveness

in the fierce competition in the milk tea drink market,

and weakens the existence of the cost-effective milk

coffee products that the brand focuses on.

3.2.2 High Consumer Flexibility, Low Price

Positioning Limits Brand Premium

Luckin has attracted young people through a large

amount of subsidies to form a price advantage for a

long time, and similar products are 5-10 yuan lower

than Starbucks, Costa and other merchants. From the

9.9 yuan activities caused by the rise in consumer

dissatisfaction can be seen, due to Luckin has

advertized itself as a cost-effective brand since its

foundation, consumers now are difficult to accept the

rise of pirce in a short time, and become very sensitive

to price changes. The price rise will evoke consumers

negative emotions,and then turn to buy other brands.

It can be seen that the brand stickiness is poor， and

it is also difficult for Luckin to launch high-end

products in a short time (Li & Yuan, 2024).

3.2.3 Unintended Consequences of the Co-

Branding Campaign on the Company's

Social Image

The main marketing method of Luckin is to broaden

the market audience by co-branding with large IP in

different fields, but sometimes blindly focuses on IP

traffic but ignores public opinion monitoring. At the

end of August 2023, players of the Black Myth Goku

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posted characters' lines that were suspected of

"objectifying women" online, believing that the it was

the example of man gaze, causing discomfort to

women, and attracting widespread attention from

users. Later, members of the main creative team were

found to have made vulgar remarks online, further

increasing the controversy over the topic of degrading

women. Luckin announced its co-branding campaign

with Black Myth Wukong in May 2024, which was

boycotted by a large number of female consumers,

who turned to Cudi coffee, which has the same

competitive price and product with Luckin. At the

same time, during the activity, due to the insufficient

preparation for consumer survey, the brand wrongly

estimated the purchasing power of consumers. Most

consumers rushed to empty because the shortage of

co-branded products, and the management of offline

stores was chaotic, leading to inefficient feedback

urged by customers. Consumers’ dissatisfaction and

negative emotions largely impacted the company’s

social image.

4 SUGGESTIONS

4.1 Strengthen Brand Positioning

Strategic product positioning and differentiation

emerge as critical success factors for contemporary

enterprises navigating competitive markets (He,

2025). In order to establish differentiated competitive

advantages, it is necessary for Luckin Coffee to

deepen its strategic positioning of professional coffee

brands. The authors recommend building a quality

assurance system from raw material procurement to

consumer experience to achieve a visual expression

of professionalism. As for the supply chain, it is

suggested to establish strategic cooperation with

high-quality coffee farms in coffee origin countries

such as Colombia and Ethiopia, and establish a coffee

quality traceability mechanism by introducing

professional coffee taster teams to evaluate the flavor

of each batch of coffee beans. In terms of production

process, it is suggested that from the origin of selected

coffee beans to the precise control of roasting, each

link should establish standardized operating norms,

such as using German Probat roasters to set of

accurate caramelization reaction parameters.

In terms of brand communication, the building of

brand image needs multi-dimensional cultural

penetration. Luckin Coffee can build a differentiated

content system in digital space dissemination, such as

creating the "Coffee Master Course" series of IPs

through short video platforms and inviting SCA

certified mentors to interpret coffee tasting

knowledge; Luckin Coffee can also set up a coffee

culture exhibition area in physical space, equipped

with AR interactive devices to present consumers

with coffee bean origin stories. A more innovative

approach is to establish a consumer participation

mechanism, such as organizing a "Coffee Flavor

Exploration Workshop" activity to guide consumers

to perceive the flavor differences brought by different

processing methods through cup testing experiences.

This immersive experience can effectively enhance

brand professional cognition.

4.2 Optimize Pricing Strategy

The current price driven growth model urgently needs

to shift towards a value oriented pricing system. The

authors suggest that Luckin Coffee build a three-layer

pyramid product matrix: basic products maintain

price competitiveness, specialty products enhance

premium space through flavor innovation, and limited

edition products focus on creating collectible value.

In specific implementation, Luckin Coffee can draw

on the successful experience of Starbucks' Select

series to develop a premium coffee series, using COE

competition grade bean seeds and nitrogen cold

extraction technology, combined with designer co

packaging, to increase the unit price to the range of

35-45 yuan.

Developing themed product combinations for

specific consumer scenarios is an effective way to

break through the price dilemma. For example,

launching the "Conference Coffee Butler" service in

business scenarios, which includes customized

espresso and professional sommelier services; Design

a gift box set of "coffee+desserts+peripherals" at

festival nodes, and increase the average customer

price through scenario based value-added services. It

is worth noting that price adjustments need to be

accompanied by explicit communication of consumer

perceived value. It is recommended to set up a coffee

bean roasting display area in stores, equipped with

professional baristas for brewing demonstrations, so

that consumers can intuitively feel the value support

of product premium.

4.3 Precise Market Research and

Collaborative Strategy

Luckin Coffee should establish a scientific market

evaluation system and effectively avoid potential

cooperation risks through multi-dimensional

consumer insights and public opinion monitoring

mechanisms. In the basic research stage, brands need

The Success of Luckin Coffee Digital Marketing from the Perspective of STP

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to build a complete user profile analysis model to

deeply analyze the characteristic maps of core

consumer groups in terms of entertainment

preferences, consumption habits, and values. Taking

the main consumption force of the new generation as

an example, its attention to ACG culture, e-sports

ecology and the concept of meta universe is

significantly higher than that of traditional media,

which provides data support for the selection of

digital culture IP with phenomenal influence, such as

Genshin Impact and League of Heroes. It is worth

noting that the dimension of IP evaluation should not

be limited to market heat, but should also

comprehensively consider its cultural connotation,

social evaluation, and legal risks, and establish a

screening mechanism including public opinion

warning index and ethical compliance review.

In specific operations, the collaborative

management of the supply chain for co branded

products directly determines the market response

efficiency. The authors suggest using a dynamic

demand forecasting model, combined with historical

sales data and real-time pre-sale information, to

achieve flexible adjustment of production capacity

allocation. At the marketing and promotion level, a

three-dimensional communication matrix of "social

fission+scene penetration" can be constructed: by

exchanging virtual props to stimulate the

participation enthusiasm of Generation Z, using AR

technology to create offline pop-up interactive

spaces, and cooperating with KOC experiential

content production to form a communication loop.

This composite promotion model not only enhances

user stickiness, but also provides data basis for

strategy optimization through real-time monitoring of

market feedback through UGC content to better

service customers. While brand partnerships lay the

groundwork for establishing brand equity, sustained

success requires marketers to shift their focus toward

consumer-centric strategies (Luo, 2025).

4.4 User Experience Optimization Path

The improvement of store service quality requires the

construction of a personalized and emotional service

system. Contemporary consumers' expectations for

the third space have surpassed basic functional needs

and are more focused on emotional experience

design. The authors suggest incorporating regional

cultural elements into the spatial layout, such as

introducing panda themed art installations in the

Chengdu store and using Shikumen architectural

decoration style in the Shanghai store to enhance

scene memory points through localized design. The

employee training system should add an emotional

labor management module, enhance service

adaptability through scenario simulation training, and

establish an instant evaluation and feedback

mechanism to directly link customer satisfaction with

performance evaluation. Luckin’s strategic emphasis

on cultivating meaningful dialogue with customers

while prioritizing employee skill enhancement has

proven instrumental in fortifying its market position

(Li et al., 2025).

Optimizing the digital experience requires

reconstructing the user journey map. For the pain

points of using the APP, an intelligent order

prediction algorithm can be introduced to pre load the

order interface based on user historical behavior data.

In the delivery process, it is recommended to use

blockchain technology to achieve full process

traceability. It is worth noting that private domain

traffic operations should break through the traditional

membership system and build user communities with

social capital attributes through innovative forms

such as NFT digital collection distribution and

metaverse coffee workshops. This virtual real fusion

experience design not only improves service

efficiency, but also enhances brand identity at the

emotional level.

5 CONCLUSION

This essay has analyzed Luckin Coffee’s marketing

strategy, highlighting both its successes and

challenges. Research findings indicate that Luckin’s

digital marketing strategy, including social media

engagement, UGC, and collaborations with other IP,

have enhanced its brand image and expanded the

market share. In the case of the Sauce-flavored Latte,

it suggests how Luckin successfully created a trend

through a combination of interactive campaigns and

traditional media amplification. Additionally,

research shows that Luckin’s affordable pricing

strategy has been crucial in attracting cost-sensitive

consumers, gaining a unique competitive advantage

over other coffee brands like Starbucks. However,

some data also reveals the drawbacks of Luckin’s

product homogeneity like Coco and Costa, providing

an unclear position to customers. Furthermore,

inappropriate co-branding like Black Myth Monkey

has increased customer dissatisfaction, weakening

Luckin’s brand image and reputation.

To navigate uncharted waters, this essay provides

significant value in understanding rapidly growing

China’s coffee industry and the importance of

targeting customers and implementing accurate

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digital marketing strategies. These findings shed light

on the fact that while temporary marketing can create

short-term success, a company’s long-term growth

still relies on its customer loyalty and sustainability.

Plus, with some evaluation and explanation of

Luckin’s digital marketing strategy, this essay has

provided a reference for other coffee companies

seeking opportunities to increase their market share

and find their target consumer through optimization

of their digital marketing strategies.

In future investigations, more in-depth data and

statistical evidence should be used to support

arguments. Instead of generalizing Luckin’s

marketing success, analyzing consumer behavior

metrics, financial reports, and market share

comparisons with competitors like Starbucks and

Costa Coffee would set the stage for further

marketing strategies analysis. Additionally, applying

marketing theories, such as AIDA (Attention, Interest,

Desire, Action), SWOT analysis, or Boston

Consulting Group matrix, can deepen the analysis,

bridge the gap between theoretical knowledge and

practical case study.

AUTHORS CONTRIBUTION

All the authors contributed equally and their names

were listed in alphabetical order.

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