From 9.9 yuan to extra‑large cups: Luckin Kudi (瑞幸库迪)'s commercial battle has long ceased to be a price war

Battle has moved from price tags to cup sizes

The fight that began with 9.9‑yuan coffees is evolving. What was once a pure price war between Luckin Coffee (瑞幸咖啡) and Kudi (库迪) has shifted into a contest over product formats and user habits — specifically the “extra‑large cup” as a new commercial lever. Luckin seeded the conversation with a high‑profile ad spot starring entrepreneur Luo Yonghao (罗永浩), and it has been reported that the film sent Luckin’s WeChat index to near‑monthly highs. Kudi responded not with a celebrity cameo but with blunt economics: reportedly offering blanket free upgrades to extra‑large cups for all users, a move meant to lock in frequency rather than margin.

From 9.9 yuan anchors to margin and retention plays

The 9.9‑yuan price point became a psychological anchor for Chinese specialty and chain coffee in the past three years, helping push the market from roughly RMB 120 billion to about RMB 320 billion, with per‑capita annual consumption rising from under 10 cups in 2019 to about 15 cups in 2025. It has been reported that Kudi opened over 18,000 stores in under three years and built large‑scale roasting and packaging capacity in Anhui to sustain thin‑margin, high‑volume economics. At scale, however, profitability pressures show: reportedly, Luckin’s fourth‑quarter delivery costs rose sharply while same‑store sales growth cooled, exposing the limits of subsidy‑driven growth and the pressures of the delivery economy.

Different tactics reveal different strategies

Both brands now treat extra‑large cups as a lever — but for different goals. Luckin is reportedly using scarcity, gamified draws and nostalgia marketing (the Luo spot, limited daily free upgrades) to create a new price‑capacity tier without overtly raising base prices. Kudi’s playbook, by contrast, has been volume and certainty: open, time‑bound but non‑limited free upgrades and low introductory coupons to cement repeat visits. Which is smarter? It depends on the metric. Luckin must juggle scale, profitability and active users as a public company. Kudi must convert rapid store growth into habitual spend.

What this means for the market

The immediate beneficiary is the consumer: bigger cups, more choices, lower effective prices. But the longer game is about habit formation. The winner won’t be the brand that wins a week of headlines; it will be the one that turns an extra‑large cup trial into daily routine without collapsing unit economics. As Chinese coffee chains migrate from headline discounts to product innovation and retention engineering, expect more experiments in format, loyalty and supply‑chain efficiency — and more pressure on margins unless brands can sustainably translate scale into true cost advantage.