“Storytelling” trend reflected in European coffee market, says Innova Market Insights

11 Aug 2020 --- A new report from Innova Market Insights highlights the unwavering demand from European consumers’ for premium coffee varieties. Innova’s Top Ten Trend of 2020 – Storytelling: Winning With Words – is particularly evident in this market as there is value in the detail, whether it be in the coffee’s source, method of production, taste profile or intensity.

Western Europe is a region of coffee drinkers. Hot coffee is still the dominant choice in the area, although the market researcher notes that iced coffee continues to expand its presence in countries such as the UK and Germany. 

Premiumization drives coffee segment
Taste is the most critical driver to both hot and iced coffee purchases, but attitudes then diverge somewhat. In hot coffee, there is some disagreement as to whether coffee is energizing or relaxing, with 32 percent of participants saying they drink it to keep themselves going. In comparison, 25 percent say it is to relax and wind down (Innova Consumer Survey 2019). 

The lines between the out-of-home and in-home markets are blurring, as the COVID-19 pandemic has restricted out-of-home opportunities.Meanwhile, in iced coffee, “happiness” and “treating” are more important than either of these. Suppliers feel that healthy consumers are happy consumers, with low sugar and dairy-free claims fast gaining ground.

For innovators, premiumization is a significant focus across the board. For example, in hot coffee, capsules for in-home machines represented over half of all hot coffee launches in 2019, up from less than a third in 2015, according to Innova Market Insights.

“Premium terminology is also adding value in this market,” says Lu Ann Williams, Director of Insights and Innovation at Innova Market Insights. “For example, use of the term ‘barista’ in coffee product names increased fivefold between 2015 and 2019, while the share of ‘cold brew’ products in the iced coffee arena alone increased from 1 percent of launches in 2015 to 19 percent in 2019.”

Ethical issues will continue to impact hot coffee in particular, with the capsules category working hard to improve its eco-credentials. Meanwhile, the lines between the out-of-home and in-home markets keep blurring, which could be necessary for the broader category as the COVID-19 pandemic has restricted out-of-home opportunities.

Europe isn’t the only market enjoying coffee culture. In June, Synergy Flavors launched a range of coffee flavors in Asia in response to the growing demand for authentic coffee-flavored products.

Edited by Elizabeth Green