Coffee - UK - August 2016
"Growth in the coffee market in 2015 was helped by strong sales of coffee pods, which was in contrast to a continuation of the decline seen in recent years in sales of instant coffee. Coffee pods offer further opportunities for growth, while premiumisation is helping to support sales of instant coffee.”
- Richard Caines, Senior Food & Drink Analyst
This report will cover the following areas:
- New flavours can help bolster the appeal of instant coffee to a younger audience
- Potential for more growth in coffee pods
- Brands and retailers can add value through encouraging more experimentation
Greater interest in trying different types of coffee products by younger people signals scope for more product developments such as coffees with more added flavours and cold-brew coffee, both of which link to the continuing development of coffee drinks available at coffee shops and cafés.
The following broad segments make up the coffee retail market:
- Instant coffee – this is the largest sector accounting for around 70% of the market. This is where, through various processes, the coffee is dehydrated into the form of powder or granules for sale, and prepared by adding these to hot water.
- Roast and ground – this is when coffee is sold in the form of coffee beans or when the coffee beans are sold ready-ground.
- Coffee pods feature pre-packaged ground beans sold in their own filter to make the coffee-making process easier. Included in this category are products for open and closed coffee systems, such as those that take a cartridge or pod.
- Ready-to-drink coffee – this is chilled ready-to-drink (RTD) coffee drinks such as Starbucks Frappuccino.
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