What you need to know

The coffee category continues to grow sales, but its largest segment (roast coffee) is losing market share to single-cup and RTD (ready-to-drink) options. Such innovations appear to be targeting and resonating with the 18-54 demographic, though older consumers have slowly begun to accept the single-cup pod concept, if not the RTD segment. With the economic recovery remaining somewhat lethargic, consumers may be finding room in their budget for the occasional coffeehouse treat, but manufacturers still have the opportunity to woo those consumers with at-home variety, unique flavors, and mainstay category brands.

This report builds on the analysis presented in Mintel’s Coffee – US, September 2013, as well as the October 2012, October 2011, September 2010, and December 2009 reports of the same title.

Definition

This report includes packaged coffee and prepared coffee beverages sold for home preparation and/or consumption. The following types of coffee are included:

  • Roast coffee – Ground and whole bean; regular and decaffeinated; unflavored and flavored coffee

  • Single-cup coffee – Cups and pods containing premeasured coffee for use in automatic single-cup coffee makers

  • Instant coffee – Regular and decaffeinated; includes both powdered and instant liquid coffee concentrates

  • RTD coffee – Shelf-stable or refrigerated bottled/canned single-serving prepared iced coffees and coffee drinks; refrigerated RTD coffee (half-gallons and single-serving)

Excluded are coffee substitutes, additives, flavorings, and syrups, including those used to make specialty coffee drinks and frozen coffee beverages at home. Also excluded is coffee sold through foodservice, such as coffee shops and restaurants, and vending machines. Bulk bin coffee beans (not packaged) also are excluded regardless of where sold. For more on coffee sales at foodservice, see Mintel’s Coffee Houses and Donut Shops – US, December 2013 report.

Value figures throughout this report are at rsp (retail selling prices) excluding sales tax unless otherwise stated.

Data sources

Sales data

  • Market Size and Forecast and Segment Performance: Total retail sales based on Information Resources Inc. InfoScan Reviews; US Bureau of Labor Statistics, Consumer Expenditure Survey; forecast developed by Mintel

  • Retail Channels: Based on sales data provided by SPINS/Information Resources Inc. Covered channels are defined as follows:

  • MULO – Multi-outlet aggregated sales for: food stores with $2 million or more in annual sales; mass merchandisers; Walmart; Sam’s Club and BJ’s Wholesale warehouse clubs; select dollar stores (Family Dollar, Dollar General, Fred’s); chain and independent drug stores; and Defense Commissary Agency chain stores

  • Natural channels – supermarkets with more than $2 million in annual sales and at least 50% of sales generated from natural and organic products but less than 50% of sales from supplements; excludes Whole Foods Market, Trader Joe’s, and supplement stores such as GNC and Vitamin Shoppe

  • Specialty/gourmet retailers – supermarkets with more than $2 million in sales annually with a minimum of 25% of overall volume accounted for by SPINS-defined specialty items; strong focus on specialty, imported, natural, and organic items

  • Leading Companies and Brand Analysis: Based on MULO, natural supermarkets (excluding Whole Foods Market), and specialty/gourmet sales data provided by SPINS/Information Resources Inc.

Consumer survey data

For the purposes of this report, Mintel commissioned exclusive consumer research through GMI to explore consumer consumption, purchases, and attitudes toward coffee sold at retail. Mintel was responsible for the survey design, data analysis, and reporting. Fieldwork was conducted in June 2014 among a sample of 2,000 adults aged 18+ with access to the internet.

Mintel selects survey respondents so that they are proportionally balanced to the entire US adult population based on the key demographics of gender, age, household income, and region. Mintel also slightly oversamples, relative to the population, respondents that are Hispanic or Black to ensure an adequate representation of these groups in the survey results. Please note that Mintel surveys are conducted online and in English only. Hispanics who are not online and/or do not speak English are not included in the survey results.

Mintel has also analyzed data from Experian Marketing Services, using the Simmons NCS (National Consumer Study) and the Simmons NHCS (National Hispanic Consumer Study). The Experian Marketing Services Simmons NCS/NHCS was carried out during the Winter 2013 survey period, and the results are based on the sample of 24,852 adults aged 18+, with results weighted to represent the US adult population.

While race and Hispanic origin are separate demographic characteristics, Mintel often compares them to each other. Please note that the responses for race (White, Black, Asian, Native American, or other race) will overlap those that also are Hispanic, because Hispanics can be of any race.

Abbreviations and terms

Abbreviations

The following is a list of abbreviations used in this report:

CPI Consumer Price Index
GMCR Green Mountain Coffee Roasters
GNPD Global New Products Database
ICO International Coffee Organization
IFT Institute of Food Technologists
IRI Information Resources Inc.
K-Cup Keurig-compatible coffee pod
MULO Multi Outlet, representative of the following channels: total US Grocery, Mass, total US Drug, total Walmart, Dollar, Military, and Club
: :
: :

Terms

Generations are discussed within this report, and they are defined as:

World War II/Swing generations Members of the WWII Generation were born in 1932 or before and are aged 82 or older in 2014. Members of the Swing Generation were born from 1933-45 and are aged 69-81 in 2014.
Baby Boomers The generation born between 1946 and 1964. In 2014, Baby Boomers are between the ages of 50 and 68.
Generation X The generation born between 1965 and 1976. In 2014, Gen Xers are between the ages of 38 and 49.
Millennials* Born between 1977 and 1994, Millennials are aged 20-37 in 2014.
iGeneration Born between 1995 and 2007, members of iGen are aged 7-19 in 2014.
Emerging generation The newest generation was born in 2008 as the annual number of births declined sharply with the recession. In 2014 members of this as-yet-unnamed generation are younger than 7.

* also known as Generation Y or Echo Boomers

In order to provide an inflation-adjusted price value for markets, Mintel uses the CPI to deflate current prices. The CPI is defined as follows:

CPI The Consumer Price Index is a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.



The CPI and its components are typically used to adjust other economic series for price changes and to translate these series into inflation-free dollars. Examples of series adjusted by the CPI include retail sales, hourly and weekly earnings, and components of the national income and product accounts. In addition, and in Mintel reports, the CPI is used as a deflator of the value of the consumer’s dollar to find its purchasing power. The purchasing power of the consumer’s dollar measures the change in the value to the consumer of goods and services that a dollar will buy at different dates.



The CPI is generally the best measure for adjusting payments to consumers when the intent is to allow consumers to purchase, at today’s prices, a market basket of goods and services equivalent to one that they could purchase in an earlier period. It is also the best measure to use to translate retail sales into real or inflation-free dollars.



Based on Bureau of Labor Statistics definition.
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