Sales of single-serve coffee have tripled since 2011
Americans are forgoing traditional roasted coffee and increasingly choosing pods used in machines such as Green Mountain's Keurig brewer.
Green Mountain and competitors like Nespresso are also increasingly popular among young adults, the research shows. Ownership of single-cup brewing coffee or espresso makers among all adults has grown to 36% in 2013 from 24% a year ago.
Drinking single-cup coffee is highest among well-off young adults: 18 to 34 year-olds earning over $75,000-a-year drink single-cups 64% of the time compared with just 51% for those earning less than $75,000. “Roasted coffee’s dominance is forecast to erode as more people opt for one cup at a time,” the Mintel report concludes.
Using the coffee machine at home or the office saves time spent in line at Starbucks (SBUX).
“You see single-cup machines popping up in more businesses and even apartment buildings,” says Ken Perkins, associate equity analyst at Morningstar. One-quarter of consumers who buy coffee drink at home more often this year than last, according to Mintel.
What’s more, oversize kitchens and dining spaces are becoming more popular in workplaces, says Colin Bryce, principal at architecture and design firm Mapos in New York. “Employers are creating spaces for workers to hang out over coffee,” he says.
While the rise of coffee pods helps minimize unused pots of cold coffee, Perkins says, they’re not cheap. “People like the fact that even though single-cup coffee is more expensive per serving, they can make just one cup,” he says. “It works out at 60 cents to 70 cents per cup, but it’s still cheaper than a roasted brew at your local coffee shop.”
Nespresso prices range from $6.50 to $7 for 10 capsules -- or $65 to $70 for 10 sleeves. And Keurig’s K-Cups cost between $12 and $24 for a box of 24 capsules, depending on the coffee; Starbucks’ “Breakfast Blend” costs $22.50 for 24 K-cups.
Could it ever beat a freshly brewed cup? Andrew Hetzel, owner of CafeMakers, a coffee-consulting business in Hawaii, says there’s at least a consistency with single cups.
“Companies are using some pretty high quality coffees, which are arguably on a par or better than typical coffees you would find in chain coffee shops,” he says. “Unless you’re going to a well-trained barista you risk getting your coffee brewed incorrectly anyway.”
But Fergal Halligan, a graphic designer in Brooklyn, calls it “bullet coffee.” He loves his morning coffee, “but I’m far more dependent on the ritual of preparing it.”
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I am working with Intelligent Blends a co-packer for Single Serve here in San Diego CA. We are working with some of the best coffees on the planet and premium roasters to bring the coffee house experience into your home and are very close to releasing a recyclable single serve kup onto the marketplace. And there will be more and more beverage choices available in the near future as this segment expands into other types of beverages & soups. I will predict the grocery stores will have whole aisles of products in single serve cups in the coming year. With price, convienience & ecofriendly kups what is there not to love? Please contact me if you have any questions.
Keith Wright VP Sales Intelligent Blends Ph (858)888-7999
We're hoping that this trend can be reversed as Keurig sold 8.4 billion kcups in FY2013. That's a lot of garbage. Reusable brew cups are the answer. Single Cup Accessories, Inc. makes a brew cup refilling system that makes filling AND cleaning brew cups nearly as easy as KCups. Check it out at SingleCupAccessories.com.
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