Table of Contents
Overview
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- What you need to know
- Definition
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- Figure 1: Coffee definitions and hierarchy
Executive Summary
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- The issues
- Roasted coffees see stagnant growth
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- Figure 2: Sales of market, by segment, current year
- RTD coffees challenged by low consumption frequency
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- Figure 3: Coffee consumption – RTD coffees, June 2016
- Competition with foodservice for specialty coffees
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- Figure 4: Coffee tracker – Coffee consumption at home and away from home, by coffee type, July 2016
- The opportunities
- Third Wave movement opens opportunity for innovation through premiumization
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- Figure 5: Attitudes and behaviors of interest regarding Third Wave coffees, June 2016
- 70% want functions with their coffee
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- Figure 6: Desired coffee functionality, June 2016
- Opportunity to cater to new drinking occasions, like mood
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- Figure 7: Drinking occasions – Consumption need, by generation, June 2016
- What it means
The Market – What You Need to Know
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- Coffee sales forecast to grow 6.3% from 2015-16 estimate
- Roasted coffee leads category sales, single-cup close behind
- Cream and creamer see sales growth, popular additions in coffee
- At home coffee consumption rate higher than at foodservice
- Coffee prices unpredictable, reliant on the state of key importers
Market Size and Forecast
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- Coffee sales forecast to grow 6.3% from 2015-16 estimate
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- Figure 8: Total US sales and fan chart forecast of coffee, at current prices, 2011-21
- Figure 9: Total US retail sales and forecast of coffee, at current prices, 2011-21
- Figure 10: Total US retail sales and forecast of coffee, at inflation-adjusted prices, 2011-21
Market Breakdown
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- Roasted coffee leads category sales, single-cup close behind
- Roasted coffee
- Single cup
- RTD coffee
- Instant coffee
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- Figure 11: Total US retail sales and forecast of coffee, by segment, at current prices, 2011-21
- Healthy future growth expected for single-cup, RTD coffee segments
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- Figure 12: Sales of market, by segment, 2012-21
- “Other” retail channels, supermarkets dominate coffee sales
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- Figure 13: Sales of market, by segment, current year
- Natural channels coffee sales grow 26.2% from 2015-16
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- Figure 14: Natural supermarket sales of coffee, at current prices, rolling 52 weeks April 2014-16
- Whole beans dominate coffee sales at natural channels
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- Figure 15: Natural supermarket sales of coffee, by type, at current prices, rolling 52 weeks ending April 2016
Market Perspective – Cream/Creamer
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- Cream and creamer see sales growth, popular additions in coffee
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- Figure 16: Total US sales and fan chart forecast of cream and creamers, at current prices, 2011-21
- Figure 17: Total US retail sales and forecast of cream and creamers, at current prices, 2011-21
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- Figure 18: Total US retail sales and forecast of cream and creamers, at inflation-adjusted prices, 2011-21
Market Perspective – Foodservice
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- At home coffee consumption rate higher than at foodservice
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- Figure 19: Coffee tracker – Coffee consumption at home and away from home, Trended December 2014 to July 2016
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- Figure 20: Coffee tracker – Coffee consumption at home and away from home, by coffee type, July 2016
- Coffee house chain most popular foodservice location
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- Figure 21: Coffee/tea segment visitation, October 2015
Market Perspective – Mintel Defines Coffee’s “Waves”
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- The history of coffee, defined by waves
- The First Wave
- The Second Wave
- The Third Wave
- Third Wave Evolution – What’s next
Market Factors
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- Coffee prices unpredictable, reliant on the state of key importers
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- Figure 22: US imports of coffee, trended 2010-14, November 2015
- US coffee consumption on the rise
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- Figure 23: US domestic consumption of coffee, trended 2011-16, June 2016
- iGeneration, Millennial populations have positive growth
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- Figure 24: Population by generation, percentage change, 2011-21
- Declining household income challenges some coffee segments
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- Figure 25: Median household income, in inflation-adjusted dollars, 2004-14
- Overlap between Millennials, acculturated Hispanics, and parents
- Millennials as parents
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- Figure 26: Households with own children, by age of householder, 2013
- Hispanics as parents
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- Figure 27: Households with own children, by Hispanic origin of householder, 2013
- Hispanics as Millennials
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- Figure 28: Generations, by Hispanic origin, 2016
Key Players – What You Need to Know
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- Leading companies see MULO sales growth
- Coffee house and foodservice brands experience gains across segments
- National brands face challenges across segments
- Coffee innovation picks up pace
Leading Companies and Brands of Coffee
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- Leading companies see MULO sales growth
- Manufacturer sales of coffee
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- Figure 29: MULO sales of coffee, by leading companies, rolling 52 weeks 2015 and 2016
What’s Working?
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- Roasted coffee house brands see sales gains at MULO channels
- Specialty roasters
- Foodservice/national coffee house brands
- Foodservice, national brands drive single-cup sales growth
- RTD coffees
What’s Struggling?
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- National brands face challenges across segments
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- Figure 30: MULO sales of roasted coffee, by leading companies and brands, rolling 52 weeks 2015 and 2016
- Keurig brand sales decline at MULO channels
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- Figure 31: MULO sales of single cup coffee, by leading companies and brands, rolling 52 weeks 2015 and 2016
- Instant coffee continues to falter in wake of single-cup success
What’s Next?
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- RTD coffees feature unique nutrition, functional qualities
- Specific regions are spotlighted
- Unique roasting and aging methods create new flavor experience
- Nitro, carbonated coffees launch at retail
- Single-cup packaging
The Consumer – What You Need to Know
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- Segmentation breakdown
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- Figure 32: Coffee definitions and hierarchy
- Core consumers drink multiple types of coffee
- Roasted coffee leading coffee format, consumed at highest frequency
- Sugar, flavored creamer leading coffee additions
- Coffee pot brewer preferred preparation method
- Classic cold coffee drinks most preferred RTD option, frequency still low
- Cold brew continues to see impressive sale gains
- The history of coffee, defined by waves
- Quality, price, premium flavor defining characteristics of Third Wave
- Roast type, flavor most influential to consumers’ coffee choice
- 70% of consumers want functionality
- Brewed, RTD coffees preferred at different occasions
Cross Consumption of Coffee Segments
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- Core consumers drink multiple types of coffee
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- Figure 33: Repertoire analysis – Coffee consumption, June 2016
Roasted and Single-cup Coffee Consumption
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- Roasted coffee leading coffee format, consumed at highest frequency
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- Figure 34: Coffee consumption – Brewed and single-cup coffee, June 2016
- Older Millennials heaviest brewed coffee drinkers
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- Figure 35: Coffee consumption (heavy and moderate) – Brewed and single-cup coffee, by generation, June 2016
- Coffee consumption influenced by household income level
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- Figure 36: Coffee consumption (heavy and moderate) – Brewed and single-cup coffee, by household income, June 2016
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- Figure 37: Coffee consumption (heavy) – Brewed and single-cup coffee, by age and household income, June 2016
- Acculturated Hispanics heavy, frequent brewed coffee drinkers
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- Figure 38: Coffee consumption (heavy and moderate) – Brewed and single-cup coffee, by race and Hispanic origin, June 2016
Brewed Coffee Additions
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- Sugar, flavored creamer leading coffee additions
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- Figure 39: Coffee additions, June 2016
- Consumers add multiple ingredients into their coffee
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- Figure 40: Coffee additions – Dairy and non-dairy additions, June 2016
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- Figure 41: Coffee additions – Sugar, sweeteners, and flavorings, June 2016
- Older consumers most likely to drink coffee black
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- Figure 42: Coffee additions – Drink it plain/black, June 2016
- Men drive usage for a variety of coffee additions
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- Figure 43: Coffee additions, by gender, June 2016
- Millennials drive usage of coffee additions
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- Figure 44: Coffee additions, by generation, June 2016
- Hispanics, Blacks, Whites stand out for preferences
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- Figure 45: Coffee additions, by race and Hispanic origin, June 2016
Coffee Brewer Usage
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- Coffee pot brewer preferred preparation method
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- Figure 46: Attitudes and behaviors – Coffee brewer usage, June 2016
- Millennials use a variety of brewers, iGen stands out with single-cup
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- Figure 47: Attitudes and behaviors – Coffee brewer usage, by generation, June 2016
- Income influences coffee brewer preferences
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- Figure 48: Attitudes and behaviors – Coffee brewer usage, by household income, June 2016
Ready-to-drink Coffee Consumption
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- Classic cold coffee drinks most preferred RTD option, frequency still low
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- Figure 49: Coffee consumption – RTD coffees, June 2016
- Millennials, iGeneration core consumer groups
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- Figure 50: Coffee consumption (heavy and moderate) – RTD coffees, by generation, June 2016
- Income level influences rate, frequency of RTD coffee consumption
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- Figure 51: Coffee consumption (heavy and moderate) – RTD coffees, by household income, June 2016
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- Figure 52: Coffee consumption (heavy and moderate) – RTD coffees, by age and household income, June 2016
- Hispanics dominate RTD coffee consumption, Blacks least interested
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- Figure 53: Coffee consumption (heavy and moderate) – RTD coffees, by race and Hispanic origin, June 2016
Cold Brew
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- Cold brew consumption remains steady from 2015-16
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- Figure 54: Cold brew coffee consumption, trended June 2015 to June 2016
- Impressive sale gains indicate increased awareness, trial
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- Figure 55: Total US retail sales of refrigerated cold-brew/concentrate coffee, at current prices, 2011-21
- Interest in cold brew preparation at home
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- Figure 56: Attitudes and behaviors, by generation, June 2016
- Classic RTD cold coffees preferred over cold brew retail varieties
Third Wave Coffee – Consumer Defined
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- Quality, price, premium flavor defining characteristics of Third Wave
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- Figure 57: Defining third wave coffee, June 2016
- “I don’t know what this is”
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- Figure 58: Defining third wave coffee – I don’t know what this is, June 2016
- Millennials, iGen drive definition of Third Wave coffee
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- Figure 59: Coffee additions, June 2016
- Potential for premiumized coffee growth
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- Figure 60: Attitudes and behaviors, by generation, June 2016
Important Coffee Attributes
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- Roast type, flavor most influential to consumers’ coffee choice
- Power of niche attributes
- Brand influences consumer coffee preferences
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- Figure 61: Important coffee attributes, June 2016
Functionality
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- 70% of consumers want functionality
- Leveraging inherent nutrition and functions
- The mood of coffee
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- Figure 62: Desired coffee functionality, June 2016
- Functionality a way to reach iGeneration consumers
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- Figure 63: Desired coffee functionality, June 2016
- Millennials, Gen Xers interested in added health benefits
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- Figure 64: Desired coffee functionality – Health focus, by generation, June 2016
Drinking Occasions
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- Brewed, RTD coffees preferred at different occasions
- Morning habitual time to drink brewed coffee
- With/without a meal
- Weather influences drink choice
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- Figure 65: Drinking occasions, June 2016
- Coffee consumption for energy, relaxation, thirst
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- Figure 66: Drinking occasions – Consumption need, by generation, June 2016
Appendix – Data Sources and Abbreviations
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- Data sources
- Sales data
- Fan chart forecast
- Consumer survey data
- Abbreviations and terms
- Abbreviations
- Terms
Appendix – Market
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- Figure 67: Total US retail sales and forecast of roasted coffee, at current prices, 2011-21
- Figure 68: Total US retail sales and forecast of roasted coffee, at inflation-adjusted prices, 2011-21
- Figure 69: Total US retail sales and forecast of single-cup coffee, at current prices, 2011-21
- Figure 70: Total US retail sales and forecast of single-cup coffee, at inflation-adjusted prices, 2011-21
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- Figure 71: Total US retail sales and forecast of instant coffee, at current prices, 2011-21
- Figure 72: Total US retail sales and forecast of instant coffee, at inflation-adjusted prices, 2011-21
- Figure 73: Total US retail sales and forecast of ready-to-drink coffee, at current prices, 2011-21
- Figure 74: Total US retail sales and forecast of ready-to-drink coffee, at inflation-adjusted prices, 2011-21
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- Figure 75: Total US retail sales and forecast of cream, at current prices, 2011-21
- Figure 76: Total US retail sales and forecast of cream, at inflation-adjusted prices, 2011-21
- Figure 77: Total US retail sales and forecast of creamer, at current prices, 2011-21
- Figure 78: Total US retail sales and forecast of creamer, at inflation-adjusted prices, 2011-21
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- Figure 79: US supermarket sales of coffee, at current prices, 2011-16
- Figure 80: US drugstore sales of coffee, at current prices, 2011-16
- Figure 81: US sales of coffee through other retail channels, at current prices, 2011-16
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- Figure 82: US supermarket sales of cream and creamer, at current prices, 2011-16
- Figure 83: US sales of cream and creamer through other retail channels, at current prices, 2011-16
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Appendix – Key Players
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- Figure 84: MULO sales of roasted coffee, by leading companies and brands, rolling 52 weeks 2015 and 2016
- Figure 85: MULO sales of single cup coffee, by leading companies and brands, rolling 52 weeks 2015 and 2016
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- Figure 86: MULO sales of instant coffee, by leading companies and brands, rolling 52 weeks 2015 and 2016
- Figure 87: MULO sales of ready to drink coffee, by leading companies and brands, rolling 52 weeks 2015 and 2016
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