Lattes, cappuccinos and mochas… oh my! While coffee drinkers are attracted to its energy-inducing powers, caffeine is no longer reserved for the morning newspaper ritual as it is extending well into the afternoon. Be it home-brewed, bottled or purchased hot or iced from a coffee shop, the coffee industry is in the midst of a rapid change. With overall coffee consumption on the rise, Millennials are at the forefront of this growing trend. And although they are drinking less coffee than generations prior, they are drinking it better – better quality, better convenience and better experiences:
The Quality: “Gourmet” coffee such as cold brews and brews from single-cup machines have taken consumers by storm. The first half of the year has shown a market shift toward high-quality, premium beverages, with younger demographics driving this trend. Brewed from premium beans, high-end coffee trends like espresso-based drinks are focused on quality and superior flavor, and will continue to grow throughout 2017. Nitrogen-infused coffee has created buzz as it is silky and smooth like a cold draft beer. The foamy and creamy texture of nitrogen brews lowers the demand for sugar and milk to cut the bitter taste, which is appealing to the more health-conscious coffee drinker.
The Convenience: More noticeable than the quality of the coffee is the number of consumers who take it on the go. The days of sipping a cup of joe made from the coffee pot are numbered, as the world has become more fast-paced than ever before. Ready-to-drink (RTD) coffee has become extremely convenient and important to the busy coffee drinker. The canned and bottled coffee market has reached upward of $2.4 billion and has only continued to climb. Aimed at consumers who need their on-the-go caffeine fix, RDT versions of coffee shop favorites like Starbucks’ Iced Latte are flooding common daytime stops like grocery stores and gas stations for a quick pick-me-up.
The Experience: While coffee continues to make large strides in quality and convenience, perhaps the most important change consumers are seeing is the experience. Because the ways to prepare a cup of coffee are numerous, consumers today are more fixated on how they feel when drinking coffee, rather than the price they pay to buy it. Out of the $48 billion U.S. retail coffee market, over 50% of spend will go toward specialty coffee drinks in the next year. Consumers are finding their niche and coffee shops are popping up on every corner. Ripple Makers have brought in a new wave of consumers to traditional cafes, allowing customers to connect to the machine, which can customize lattes in less than ten seconds. Birmingham Roast, a neighborhood coffee shop founded this year, brings a West Coast vibe to Michigan’s most prominent city, welcoming consumers with a third-wave coffee experience. Coffee consumption has moved far beyond the privacy of consumers’ homes to public venues.