The Growing Avenues of Coffee

Coffee drinkers are getting younger. Unlike older generations, Gen Z and millennials are more likely to have started drinking coffee between the ages of 13 and 16.

Social media and pop culture have helped drive this trend; highlights include:

• Emma Chamberlain: A coffee-loving Gen Z YouTube star, who founded Chamberlain Coffee, a brand that has amassed a retail presence in over 10,000 stores, a portfolio of products from beans and grounds to cold brew singles, ready to drink coffee (RTD), and coffee accessories and merchandise. She’s also secured investors and recently opened a flagship café in Los Angeles
• Nespresso Coffee Boutiques: Outlets providing immersive experiences (sampling, education, creative experimentation, shopping, lounge space) tailored to Gen Z
• Coffee Bar Tutorials: How-to videos detailing easy to elaborate home set-ups
• The Knot: A popular wedding planning platform, proclaiming the Breville Bambino Plus Espresso Machine “one of the best wedding registry items, hands down”
• Masterclass: World Champion Barista Dale Harris sharing ways to up your coffee game

Here’s what excites us most in the at-home space:

• Swiss brand No Normal’s coffee paste tubes that not only provide instant coffee when added to water, but can be squeezed into smoothies, sauces, or used as a spread
• Frozen coffee pucks and pods from the likes of Cometeer that ensure instant coffee is as fresh as possible
• Keurig’s new features that enable espresso, added froth, and both hot and cold drinks
• Honey sweeteners from Nespresso
• Upscale cold brew subscriptions from Kloo, small batch, and delivered in glass bottles within a temperature-controlled box

Almost half of U.S. coffee drinkers buy coffee from a shop at least once a week, and while there has been plenty of pushback on inflationary pricing, it remains an “affordable indulgence.”

As Starbucks – the king of coffee shops – works to regain its footing, competition is coming from every corner. Industry analysts claim, “coffee shops are suddenly popping up everywhere,” and competitors like Dutch Bros have achieved twice Starbucks sales growth in the last year. In addition, most quick service restaurants and convenience stores – like Casey’s – are overhauling their coffee programs, and even indirect global players, like the Philippines’ Jollibee Foods, have made coffee-related acquisitions.

What’s catching our eye in the away-from-home space?

• Cold brew on tap at various chain locations, e.g., Starbucks, La Colombe, Stumptown, Peet’s, Dunkin’, etc.
• New nitro flavors hitting menus, e.g., Horchata, Pistachio, Nutella, and Lavender
• The Black Russian revolution, a less labor-intensive cocktail than the Espresso Martini, with just two ingredients: vodka and coffee liqueur

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A post shared by La Colombe Coffee Workshop (@lacolombecoffee)

• The rise of “Profee” through protein-infused coffee beverages, like Starbuck’s high-protein RTD coffee, with 20g of protein per bottle, and Peet’s Coffee’s Vitality Menu of protein lattes
• Throne Sport Coffee, a better-for-you RTD option that leaves the sugar-laden “milkshake” out of the can
• Happy Coffee’s collaboration with the National Alliance on Mental Illness, giving them an equity stake in the brand, and using its packaging to spread awareness
• Superfood coffees, made with adaptogenic mushrooms, turmeric, matcha, etc.
• New research on the effect of coffee on the gut microbiome, which found that coffee increases the prevalence of beneficial bacteria
• Kiid Coffee, a decaf instant coffee and cacao mix for children, sweetened with monk fruit and fortified with fiber, calcium, magnesium, iron and Vitamin D

Responsible Packaging:

In addition to personal health, “today’s consumer is looking to have it all – great taste and sustainably sourced ingredients and packaging that are ‘guilt-free’.” Starbucks’ global presence means that their small differences can equate to big changes, and have recently introduced:

• Starbucks’ reusable cup program and compostable cups for cold beverages

Coffee Alternatives:

• Atomo, a Seattle-based beanless coffee made from upcycled date pits, with the same color, aroma, flavor and mouthfeel as traditional coffee
• Cascara, with a “coffee meets tea” appeal, made from the dried skins of coffee cherries
• Yaupon tea, an earthy, herbal-tasting caffeinated plant grown in the southeastern U.S.