Consumer expectations of coffee brands will rise “dramatically” as eco-anxiety replaces pandemic paranoia, predicts a senior researcher with Mintel in Europe.
“Undoubtedly, sustainability will be the defining issue for the coffee industry over the next 20 years,” says Jonny Forsyth, associate director, Mintel Food & Drink.
Covid-19 has made consumers more sensitive to inequalities, and most farmers are poorly paid despite coffee’s huge profits and use of fair trade claims, he says.
“Brands will need to help farmers navigate global warming to avoid the loss of supply and livelihoods. Brands will need to be much more ‘hands on’ and put their sustainable values and actions at the heart of their brand message.”
At the same time, consumers are becoming more aware of carbon emissions and coffee is one of the worst offenders.
“The more activist-minded younger generation will show less tolerance for waste, especially pods that are recyclable but rarely recycled, with launches of ‘greener’ pods expected to grow fast,” he says.
Consumers worldwide are already drinking coffee with a conscience – nearly half of all new coffee product launches last year bore an ethical or environmental claim, according to data from the Mintel Global New Products Database (GNPD).
That proportion has surged from 25 per cent in 2012 to 48 per cent in just eight years.
When it comes to sustainability, Mintel’s GNPD says coffee fares well compared to the total food and drink market where just 35 per cent of new product launches carry a sustainable claim in Europe – compared with 64 per cent of coffee launches in the region.
But there are issues in the coffee market over the recyclable or compostable nature of packaging.
Pods or capsules – which account for 24 per cent (excluding concentrated and other lines) of global coffee innovation – are the category’s most controversial format because of the amount of landfill waste they create. Just 39 per cent globally carry a recyclable claim, with 11 per cent of pods or capsules biodegradable claim and 10 per cent compostable.
Home baristas on the rise
Meanwhile, the pandemic has forced consumers to make more coffee at home and attempt to replicate the quality of the fresh, on-premise brews they are accustomed to drinking in coffee shops pre-pandemic.
Covid spurred an 8-per-cent rise in total global packaged coffee launches last year. Fresh varieties including pods (24 per cent), ground (23 per cent), and beans (15 per cent) now account for almost two thirds of global coffee innovation collectively.
The ‘in-home barista’ trend is far more developed in Western markets – defined as North America, Europe and Australasia – where pods, beans, and ground coffee account for 77 per cent of all coffee launches, compared to just 44 per cent in Asia, Latin America, the Middle East, and Africa – where mixes (20 per cent), instant (18 per cent) and ready-to-drink (RTD) (19 per cent) dominate.
Ground coffee has experienced a substantial jump in innovation in Western markets, accounting for 19 per cent of new product launches in 2019 rising to 24 per cent last year.
Many coffee brands from small artisan makers to multinationals are working towards making their supply chain and packaging more environmentally friendly. Nestle recently teamed up with Alibaba‘s Cainiao Network on an initiative in China.
- Featured image: @eyamarajas via Twenty20.