No 30

Specialty Coffee Shops are Stepping Up the Pace

October, 2014

TRENDS

Specialty Coffee Shops are Stepping Up the Pace

Although sales in traditional cafés represent 75% of the world market for coffee consumed outside home, specialty coffee shops are growing at a much faster rate, even faster than the total of the food service industry.

Coffee culture evolves increasingly faster towards sophistication and added value. In different parts of the world, and beyond the also growing consumption of single serve at home, drinking coffee is a ritual held in meeting places divided into two main categories: traditional cafés and specialty coffee shops.

The first category refers to traditional places where people gather to drink or eat different products, and talk with friends or neighbors and perform other activities, such as surfing the internet. These coffee selling places abound in European countries such as Italy and France, but they also have a strong presence in Latin America and Asia.

On the other hand are the specialty coffee shops, where the thread that drives the experience is coffee and espresso-based drinks. The second category has grown primarily in North America, but has also gained momentum in the rest of the world with the presence of multinational chains and local brands.

The world market of coffee consumed outside home is worth about $154 billion, of which approximately 75% are sales in traditional cafés and 25% are in specialty coffee shops. Despite this difference, coffee market studies by Euromonitor show that on the world stage the specialty shops are growing at a much faster rate than traditional coffee shops, even faster than the total of the food service industry.

Figure 1
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The essence of specialty shops is their gourmet coffee and, of course, the barista. The 100% Colombian Coffee Program, in order to be relevant in this segment of growing importance for the coffee chain, has created a space specially designed for baristas: the Colombian Coffee Hub, a specialized social network in which there are deep talks about Colombian coffee, brewing methods, flavor profiles and foodpairing, among others, looking to turn Colombia into the favorite coffee origin in specialty coffee shops.

 

Figure 2
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Source: Euromonitor


International Coffee Day

The new coffee culture has increased consumption of all coffee categories in countries such as the United States. Growth of coffee culture is not only evident in the figures, but also in the importance of promotional events such as the “International Coffee Day.” On September 29th this celebration took place in North America and it becomes more relevant every year. As every year, the top companies of the coffee industry and the major retailers joined the celebration with special promotions.

The celebration of this day has become the date on which restaurants, small cafés and chain stores advertise their coffee as a competitive advantage. During the International Coffee Day consumers can access special promotions in different specialty shops. McDonald’s, Krispy Kreme, Dunkin ‘Donuts and Tim Hortons, among others, were among the large coffee shops that did commemorate this day by offering coffee tastings, doing promotions in pricing their coffee-based drinks and offering discounts for on-line purchases.

Finding a cup of coffee on that day was not difficult as Dunkin ‘Donuts gave its customers free coffee all day; meanwhile McDonald’s complemented its breakfasts with a small cup of its “Premium Roast Coffee” for its customers and this trend was joined in by small specialty coffee shops across the United States, which did not miss the chance to get noticed. Recognized coffee brands in this market such as Folgers and Eight o’Clock were not far behind: their social networking pages launched competitions to celebrate this special day; among prizes offered were brand products, cash and even trips.

The International Coffee Day is still fairly new and in the coming years is expected to continue to grow in terms of visibility; so there are opportunities for producers and marketers that can take advantage of rising demand for coffee on this date in the coming years. The coffee culture is refining and intensifying in the United States and around the world; competition is not only by price, as consumers increasingly value experiences and singular characteristics such as coffee origin that they receive from gourmet coffees such as those offered by 100% Colombian Coffee brands.

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