Table of Contents
Overview
-
- What you need to know
- Products covered in this Report
Executive Summary
-
- The market
- Coffee shops face headwinds…
- …but there are opportunities for growth
-
- Figure 1: UK coffee shops market, value sales, 2012-22
- Companies and brands
- Opportunities in consumer goods
- Food and drink concepts
- Coffee shop technologies
- The consumer
- Coffee shop usage
-
- Figure 2: Outlets used to buy hot drinks out of home, October 2017
- Most popular drinks
-
- Figure 3: Most popular drinks bought out of home, October 2017
- Interest in menu features
-
- Figure 4: Menu features that drive interest, October 2017
- Motivations of independent users
-
- Figure 5: The factors that drive independent coffee shop users to visit, October 2017
- Behaviours towards coffee shops
-
- Figure 6: Behaviours towards coffee shops, October 2017
- What we think
Issues and Insights
-
- Attracting older generations
- The facts
- The implications
- New-wave loyalty
- The facts
- The implications
- Meal deal potential
- The facts
- The implications
The Market – What You Need to Know
-
- Modest growth expected
- The opportunities presented
- The challenges faced
Market Size and Forecast
-
- The coffee shops market is worth £3.4 billion in 2017…
-
- Figure 7: UK coffee shops market, value sales, 2012-22
- …and is forecast to reach £3.7 billion by 2022
-
- Figure 8: UK coffee shops market, value sales and forecast, 2012-22
- Forecast methodology
Market Drivers
-
- The challenges
- Soft Drinks Sugar Levy due in 2018
- Business rates
- Rising inflation
- National Living Wage and National Minimum Wage
- Coffee production comes under pressure
- The opportunities
- Growth of the workforce
- Growth of the ageing population
-
- Figure 9: Trends in the age structure of the UK population, 2011-16 and 2016-21
- Figure 10: Trends in food behaviours which consumers do all of the time, April 2016-November 2017
-
- Figure 11: Trends in healthy food factors, April 2016-November 2017
Companies and Brands – What You Need to Know
-
- Consumers' perceptions of selected restaurant brands
- Why are big brands moving into the grocery sector?
- New on the food menu
- New on the drinks menu
- Examples of brands that are growing
Market Share
-
- Costa Coffee leads a congested market
-
- Figure 12: Selected UK coffee shops, market share by outlet numbers, 2015-17
- Independent operations rival big names
-
- Figure 13: Selected independent coffee shops, by outlet numbers, 2017
Company Profiles
-
- Branded chains
- Costa Coffee
-
- Figure 14: Key financial data for Costa Limited, 2015 and 2016
- Starbucks
-
- Figure 15: Key financial data for Starbucks Coffee Company (UK) Ltd, 2014-16
- Caffè Nero
-
- Figure 16: Key financial data for Caffè Nero Group Ltd, 2015 and 2016
- Coffee#1
-
- Figure 17: Key financial data for Coffee#1 Limited, 2015 and 2016
- SOHO Coffee Co.
-
- Figure 18: Key financial data for SOHO Coffee Shops Limited, 2015 and 2016
- Third wave coffee
- Workshop Coffee
- Black Sheep Coffee
- Ones to watch
- Tim Hortons
- Second Cup
- Nespresso
- easyCoffee
- 200 Degrees Coffee
- Wayne’s Coffee
Launch Activity and Innovation
-
- New opportunity in retail
-
- Figure 19: Examples of coffee shop-branded products, 2017
- New on the drinks menu
- Cold brew and nitro cold brew
- Year-round frozen drinks
- Cocktail-style iced drinks
- New chocolate-based drinks
- Dairy-free options
- New on the food menu
- Breakfast options
- Plant-based items
- Starbucks launches lunchtime meal deal
- New in coffee shop technology
- Behind-the-scenes marketing
- Voice ordering
- Smarter mobile apps
- New coffee shop formats
Advertising and Marketing Activity
-
- Mobile usage drives digital spend
-
- Figure 20: Advertising expenditure, by media type, 2013-17
- Costa Coffee uses movies to reach customers
-
- Figure 21: Advertising expenditure by selected coffee shop operators, 2013-17
- Caffè Nero explores outdoors and digital
-
- Figure 22: Advertising expenditure by selected coffee shop operators, by media type, 2013-17
- McCafé ramps up advertising activity
-
- Figure 23: Advertising expenditure by McDonald's – McCafé, 2015-17
- Nielsen Ad Intel coverage
Brand Research
-
- Brand map
-
- Figure 24: Attitudes towards and usage of selected brands, October 2017
- Key brand metrics
-
- Figure 25: Key metrics for selected brands, October 2017
- Brand attitudes: McCafé delivers value for money
-
- Figure 26: Attitudes, by brand, October 2017
- Brand personality: McCafé stands on a par with Costa Coffee as accessible brands
-
- Figure 27: Brand personality – Macro image, October 2017
- Pret A Manger is seen as the healthiest brand of all
-
- Figure 28: Brand personality – Micro image, October 2017
- Brand analysis
- Costa Coffee receives the most positive endorsements from its customers
-
- Figure 29: User profile of Costa Coffee, October 2017
- McDonald’s McCafé represents excellent value for money
-
- Figure 30: User profile of McDonald’s McCafé, October 2017
- Starbucks needs to do more to improve brand commitment
-
- Figure 31: User profile of Starbucks, October 2017
- Pret A Manger is the healthiest brand of all
-
- Figure 32: User profile of Pret A Manger, October 2017
- Caffè Nero fails to strongly differentiate itself in a highly competitive market
-
- Figure 33: User profile of Caffè Nero, October 2017
The Consumer – What You Need to Know
-
- Consumer usage habits
- Most popular coffee shop drinks
- Identifying interests in menu features
- Understanding the motivations of independent coffee shop users
- Examining the behaviours towards coffee shops
Usage Habits
-
- Four in five bought hot drinks out of home
-
- Figure 34: Any outlets used to buy hot drinks out of home, by generational groups, October 2017
- Costa is the most widely used brand
- Almost one in four bought from a fast food chain
-
- Figure 35: Outlets used to buy hot drinks out of home, October 2017
- One in four visited an independent coffee shop
-
- Figure 36: Any outlets used, by any outlets used, October 2017
- Understanding the types of customers
-
- Figure 37: Repertoire of outlets used to buy hot drinks out of home, October 2017
Most Popular Drinks
-
- Italian-style espresso-based drinks popular among middle age groups
- Middle-aged women are drawn to café latte
-
- Figure 38: Any drinks bought out of home, by any outlets used, October 2017
- Middle-aged men are drawn to cappuccino
-
- Figure 39: Italian-style espresso-based drinks bought out of home, by age and gender, October 2017
- Chocolate-based drinks attract young consumers
- Hot chocolate
-
- Figure 40: Chocolate-based drinks bought out of home, by age, October 2017
- Mocha
-
- Figure 41: English breakfast tea bought out of home, by generational groups, October 2017
- Older Millennials are buying English breakfast tea
-
- Figure 42: Most popular drinks bought out of home, October 2017
- Understanding the types of drinkers
-
- Figure 43: Repertoire of most popular drinks bought out of home, October 2017
Menu Interest
-
- Cake and breakfast meals make a sweet deal
- Cake and coffee/tea deals for older groups
-
- Figure 44: Interest driven by cake and coffee/tea deals, by age, October 2017
- Breakfast meal deals for people in work
-
- Figure 45: Interest driven by breakfast meal deals, by working situation and location, October 2017
- Decaf drinks for parents
-
- Figure 46: Interest driven by premium decaffeinated tea/coffee, by parental status, October 2017
- Mocktails for parents and younger audiences
- Slushies for younger customers and parents
- Low-calorie meals for women
- Londoners fuel demand for non-dairy milk
-
- Figure 47: Interest driven by dairy-free milk options, by region, October 2017
- Younger Millennials are drawn to cold brew and loose tea
- Cold brew or nitro cold brew coffee
- Loose tea infusion
-
- Figure 48: Menu features that drive interest, October 2017
Independent Coffee Shop Users
-
- Over-45s are drawn to friendly customer service
- Product knowledge important in customer service
- Single-origin is akin to concept of terroir in wine
- Shop design elevates experience around coffee
- Ethical labels help independents distinguish from rivals
- What makes independent coffee shops ‘cool’
-
- Figure 49: The factors that drive independent coffee shop users to visit, October 2017
Behaviours towards Coffee Shops
-
- Consumers would cut back if prices increased
- Mix-and-match meal deals are appealing to most
- Coffee shop proximity to where consumers live
- Understanding consumers’ interest in loyalty schemes
- Turning points into charity donations
- Passing on rewards to other people
- Swapping for non-food rewards
- Send offers based on purchase history
- Using geolocation to send offers
- Millennials and parents seek premiumisation
- They enjoy sweet treats
-
- Figure 50: Behaviours towards coffee shops, October 2017
- They seek premium food/drink
-
- Figure 51: Behaviour towards coffee shops, any “yes”, by any venues visited, October 2017
CHAID Analysis
-
- Methodology
- Let people pass on their loyalty rewards to others
-
- Figure 52: Coffee shops – CHAID – Tree output, October 2017
-
- Figure 53: Coffee shops – CHAID – Table output, October 2017
Appendix – Data Sources, Abbreviations and Supporting Information
-
- Abbreviations
- Consumer research methodology
Appendix – Market Size and Forecast
-
- Forecast methodology
-
- Figure 54: Best- and worst-case forecasts for UK coffee shops market, 2017-22
Back to top