Coffee consumers’ concerns over the environment as well as the socio-economic conditions of coffee farmers, have made the sustainability conversation the leading trend in coffee over the last decade. Thanks to consumers, ethically sourced coffee is no longer a rarity but is commonly found in most supermarkets. Looking forward, where are consumer trends headed and how well are you positioned to deliver on them?
As we’ve pointed out before, the Ready-to-Drink (RTD) market is booming. Estimates are that the category will grow to USD 12bn in the next decade. So what is the coffee “RTD” market all about? (Coffee purists look away now.) RTD refers to packaged coffee beverages that are effectively “ready to drink” and available in retail stores, off-the-shelf. Expect to see iced coffees served in cartons, bottles or cans and flavoured, for example, with honey and lemon… Expect fizzed or “sparkling” coffee with all kinds of twists (including “ginger citrus”!). Dunkin’ Donuts have recently even teamed up with craft brewer, Harpoon to release a coffee-flavoured beer. Have you tried Coca-Cola Plus, the coke and coffee combo? The takeout here for smaller operators could be; coffee is not just a hot drink, it can also be an amazing ingredient, experiment.
We know that consumers are demanding traceability at every step of the supply chain too. They want the what, the where, the how and the impact on people and the environment all delivered to their phone. Online companies like provenance.org allow consumers to discover the entire journey and backstory behind consumer products before they commit to buying. By simply entering a code to an app on your phone, you get to see every single detail in the supply chain, manufacture, materials and distribution of that particular product. This should be an early warning for no-name and unbranded coffee brands like those we currently find in hotels and restaurants. Consumers will want to see a visible brand that they can identify with.
It’s worth noting too that bean-to-cup machines are becoming more and more affordable. This means that, for domestic consumption, the inevitable trend will be for consumers to favour beans (for their freshness) over ground. In all probability, ground will most likely become the exception on supermarket shelves in the future.
The predominant themes that emerge from these trends are: a move to ethically sourced products, a wider variety in the (coffee) offering, and keeping customers close through tech. Smaller operators will be up against the power of convenience. Big retailers will continue to try and lock consumers into their app ecosystems with loyalty programmes, subscriptions and promotions. For small businesses the lesson is: invest in your name and your brand and find innovative ways to share the story behind your product.
Have you noticed any new trends in the local market you’d like to share? Please email us at email@example.com