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🇰🇷 South Korea /Economy & Trade

Mega MGC Coffee Nears Starbucks in Payment Volume

From Hankyoreh · () Korean

Translated from Korean, summarized and contextualized by DistantNews.

At a glance

News Documents & data Context piece
  • Mega MGC Coffee is rapidly closing the gap with Starbucks in South Korea's coffee market, with its payment volume reaching 94.9% of Starbucks' last month.
  • While Starbucks retains the top spot for monthly active users on its app, Mega MGC Coffee recorded its highest user numbers ever, despite a smaller user base.
  • Mega MGC Coffee's growth is attributed to its extensive network of franchise stores and high offline purchase frequency, which drive sales despite fewer app users compared to Starbucks.

In South Korea's competitive coffee market, Mega MGC Coffee is making significant strides, nearly matching Starbucks in payment volume. Last month, Mega MGC Coffee's payment volume reached 94.9% of Starbucks' total, a dramatic increase from the 5.1% gap recorded just a year ago.

Despite Starbucks maintaining its lead in monthly active app users, partly due to recovering from a previous controversy, Mega MGC Coffee has achieved a record high in its user base. This growth occurred even as Starbucks saw a dip in users following the 'Tank Day' controversy, though it has since begun to rebound.

The payment volume gap, which reached 30.5 percentage points in the same month last year, has narrowed significantly to just 5.1 percentage points in one year due to Mega Coffee's steep growth.

— WiseApp·RetailExplaining the rapid narrowing of the payment volume gap between Mega MGC Coffee and Starbucks.

Industry analysts suggest Mega MGC Coffee's success stems from its widespread presence with numerous franchise locations across the country and a high frequency of in-store purchases. These factors contribute to its revenue growth, allowing it to challenge Starbucks' dominance even with a smaller active app user count.

Mega MGC Coffee's monthly active users increased by 7% compared to the same month last year, reaching 3 million, an all-time high.

— WiseApp·RetailDetailing the growth in Mega MGC Coffee's app user base.
DistantNews Editorial

Originally published by Hankyoreh in Korean. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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