Not Just Another Cup Of Coffee

Coffee is experiencing a surge in sales and selection, with a variety of options available to suit various tastes. Starbucks’ sales are soaring, supermarkets are adding coffee bars, and high-end specialty blends are turning coffee into a delicacy. The coffee industry is also evolving, with brewing methods like AeroPress and siphon catching on as contemporary coffee reinvents itself.

The National Coffee Association CEO William Murray stated that coffee continues to be America’s favorite beverage, and the sector is spurring start-ups and acquisitions to capitalize on this culture. Sprouts Famers Market recently partnered with Press Coffee to open four more locations inside Sprouts stores, while Atomo Coffee is launching its “beanless coffee” brew made with “the same molecular structure” as coffee.

Coffee production continues to grow as America’s daily ritual embraces the bean, from morning lattes to coffee-based beverages like espresso and cappuccinos. Home coffee consumption reached 82% in 2023, while in-office coffee consumption rebounded to pre-pandemic levels, with 36% of Americans having coffee at the office. Americans begin their day with coffee, with 81% having coffee with breakfast, 15% with lunch, 19% in the afternoon, 7% with dinner, and 10% in the evening.

Lattes are the most popular espresso-based beverage consumed by 18% of Americans in the past week, followed by espresso at 16%, and cappuccinos at 15%. Flavor is fueling growth, with about 30% of Americans having flavored coffee in the past week. Vanilla is the most popular flavor, followed by caramel and hazelnut, followed by mocha.

In summary, coffee is experiencing significant growth in sales, selection, and popularity, with the industry adapting to the changing preferences of consumers.

Coca-Cola has acquired La Colombe, a company that focuses on oat milk, cold-brew coffee, probiotic beverages, and coffee creamers. Chobani, which ended 2023 by announcing its purchase of La Colombe for $900 million, has a deep presence in the fast-growing ready-to-drink coffee category. Starbucks’ Stellar XLM 0.0% Season saw global comparable store sales surge 8% in 2023, while comparable US store sales increased 9%. The company reported full-year consolidated net revenues rose 12% to a record $36.0 billion, up 14%.

Cold brew coffee is also hot, with popularity skyrocketing 300% since 2016. Companies like Schnobs, Cove Coffee, Slingshot Coffee, Grady’s, High Brew, and Nestle are all playing in the space. The US ready-to-drink coffee market is expected to reach $8.61 billion by 2029, with Starbucks commanded a 41% market share in RTD as of mid-2022.

The coffee machine sector is also growing, with drip coffee makers being the most popular and used by 40% of past-day coffee drinkers. Single-cup brewers are second at 27%, cold brewing at 16%, and espresso machines at 11%. The coffee machine industry in the United States is projected to reach about $3.7 billion by 2024 and grow 2.35 percent a year through 2028.

The coffee subscription market is booming, with the global coffee subscription market expected to reach nearly $2 billion in a decade. Subscriptions grew at an annual rate of 11.5% from 2017 to 2021, delivering coffee and convenience. Driftaway Coffee offers coffee from around the globe, Amazing Clubs offers 100% Arabica beans, Blue Bottle sells espresso blends and single origins, and Intelligentsia offers organic beans sourced from Africa and South America.

Innovation and consumer preferences have fueled tremendous growth in the coffee industry, making it essential to consider what type, location, flavor, and type of coffee to enjoy.

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