The mismatch with matcha consumption & Gen Z

MATCHA’s rise in Western markets has been rapid, visual, and unmistakably youth-driven. Once associated primarily with Japanese tea ceremony and traditional hospitality, it now appears in layered iced drinks, flavoured foams, pastel cafés, and customisable takeaway menus.

For Gen Z consumers in particular, matcha has become both a caffeine alternative and an aesthetic signal. But the way it is consumed in the West sits in sharp contrast to its origins within chado (the Way of Tea), a practice shaped by Zen philosophy.

The mismatch between ritual and retail raises strategic questions for coffee shops, brands, and producers. Is the current wave a temporary phase of market expansion? Or is matcha destined to bifurcate into two distinct categories: mass-market lifestyle beverage or premium cultural product?

From ceremonial bowl to customised takeaway

Darleen Scherer is the Founder of Black Sheep Coffee Collab. She sees strong parallels between the evolution of specialty coffee and matcha, despite the striking difference between popular consumption and traditional methods. 

“The gap is significant, and it mirrors what we saw in coffee’s evolution,” she says. “Traditional Japanese matcha consumption is rooted in a centuries-old ceremonial practice that emphasises mindfulness, precision, and respect for the ingredient itself, which is a stark contrast to the iced, syrup-laden, oat milk matcha lattes dominating Western café menus.” 

For Darleen, the commercial logic mirrors coffee’s early-2000s identity shift, in which specialty coffee entered the mainstream. This was partly driven by the rapid expansion and popularisation of brands such as Starbucks and the founding of specialty brands such as Blue Bottle in the late 1990s and early 2000s, as well as ”third wave” coffee growing into mainstream acceptance. 

“What’s happening with matcha today is essentially the same playbook we’ve seen in specialty coffee: a culturally rich product gets repackaged for mass consumption, prioritizing visual appeal and customization over the craftsmanship that defines it,” she says. 

In Japan, matcha is inseparable from the structure of the tea ceremony. The act of preparation – including whisking, serving and receiving – is not simply functional, but philosophical.

Darleen argues that when matcha becomes primarily a takeaway beverage, the loss is contextual as much as sensory.

“These values are foundational, not ornamental. The Japanese tea ceremony isn’t just a preparation method; it’s a philosophy of presence and intentionality that’s been refined over centuries,” she says. “When matcha becomes a grab-and-go beverage primarily, what’s lost isn’t just the ritual. It’s the entire framework that gave the product its cultural significance.” 

Global demand is also reshaping the realities of production and consumption. Reuters recently reported that the output of Japanese tencha – a premium Japanese green tea that serves as the raw material for producing matcha – is struggling to keep pace with surging global demand.

Mirroring specialty coffee

Gen Z’s relationship with beverages is deeply tied to personal expression. Customisation, including sweetness level, milk choice, toppings and colour variations, is often framed as control and identity-building rather than indulgence.

Despite matcha’s association with quality, much of the growth in demand is understandably concentrated.

Darleen adds that “the majority of demand growth is concentrated at the commodity-grade level”, with “the kind of matcha powder that works in sweetened lattes, smoothies, and ready-to-drink beverages, not the ceremonial-grade product that traditional practitioners would recognize”.

This mirrors specialty coffee’s own trajectory: broad commercialisation first in the second wave, followed by clearer segmentation and premiumisation. Whether matcha follows the same journey will depend ultimately on how demand settles.

Scherer believes specialty coffee businesses have a decisive influence, but that idealism must give way to operational realism. 

“Expecting full ceremonial tea service in a high-volume retail environment is neither realistic nor commercially viable for most operators,” she says. “What is realistic is building education into the experience through design: origin information on the menu, visible preparation that honors the craft, staff trained to explain the difference between ceremonial and culinary grades, and perhaps a dedicated offering that showcases traditionally prepared matcha alongside the more accessible options.” 

A bifurcated future

Rather than converging on a single format, Western matcha consumption is likely to split. Matcha’s commercial success may not depend on resolving the mismatch between its traditional roots and the demands of Gen Z consumers, but on managing it intelligently.

“I expect matcha consumption in the West to bifurcate, much like specialty coffee has,” Darleen says. “The mass market will continue moving toward functional, flavored, and convenience-driven formats, while a meaningful premium segment will develop around traditional and high-quality preparation.” 

One way to bridge this gap is to clearly distinguish between customised applications and traditionally prepared ceremonial-grade matcha, whisked by hand and served without milk or sweetener. By making preparation visible and offering grade differentiation, coffee shops can create a premium tier that respects matcha’s origins while maintaining accessible, high-volume formats. 

In that scenario, the mismatch between Gen Z consumption and traditional Japanese philosophy becomes less a contradiction, and more a stage in category development. A visually driven, customisable entry point can build awareness and volume. 

The implication is clear: as volume increases, the commercial value of matcha’s cultural narrative also increases, and honoring ritual becomes part of differentiation strategy. The long-term value, however, will depend on whether operators preserve a pathway toward authenticity, flavour literacy, and cultural respect.

“The brands that figure out how to translate elements of that intentionality into a modern café experience, without pretending to replicate a full tea ceremony, will be the ones that build the most lasting consumer loyalty,” Darleen says.