Premium Coffee Trends to Watch

Here are the top five consumer need states fueling innovation in the specialty coffee category.

October 28, 2021

Iced Coffee

ALEXANDRIA, Va.—Consumers are expecting more and more c-stores to offer the kind of coffee drinks they can’t reproduce at home.

Specialty coffee falls into the hot dispensed beverage category, and like most foodservice categories, “hot dispensed beverages struggled in 2020 because of shutdowns due to COVID-19 and decreased store traffic,” said Jayme Gough, research manager, NACS. “Hot dispensed beverage sales fell 32.2% from 2019 to 2020, and gross profit dollars per store annually were down 34.4%.”

But when customers did pour coffee, many poured specialty brews. Despite last year’s disappointing sales, specialty coffee made up the second largest percentage of hot dispensed beverage sales (38.4%) in convenience stores.

But what types of premium coffee are driving the trend? Flavorchem, a supplier of coffee extracts including cold brew concentrates, shared with Beverage Daily the five trends that are fueling premium coffee innovation.

  1. Cold Coffee

According to Statista, cold brew coffee sales are expected to reach $1 billion by 2025. Cold brew can be seen as healthy to consumers, and there are many different flavors and a range of formats, for example, nitro.

NACS Magazine explored premium coffee in “Craft Coffee Haven” in the September 2021 issue and cited a stat by the National Restaurant Association that although hot coffee remains the most popular choice for 47% of java fans, cold brew coffee is the fastest-growing coffee drink, with sales increasing by 4.6% year over year.

The younger generation especially loves cold coffee, with 40% of 18 to 24 year-olds wishing their local c-stores had more cold coffee offerings, according to Jeff Ulrich, strategic account manager, BUNN, an American manufacturer of dispensed beverage equipment.

  1. Wellness
Consumers are looking to “health-ify” everything they can, and Mintel found that coffee is no exception. They found that 30% of coffee drinkers are interested in coffees with added health benefits, such as immune and cognitive support supplements or adding more protein or probiotics to their cup of joe.
  1. Sustainability

Consumers expect coffee companies to care about the sustainability practices surrounding their business because they care. Sustainability practices can include fair trade, humanitarian rights, upcycling, eco-friendly packaging and more.

NACS Magazine found that Gen Z especially expects transparency in the foods and beverages they consume. “Sustainability is a big buzz word right now, and 73% of consumers say they’d change their coffee consumption habits to ensure their coffee was sustainable,” said Scott Reed, communications and data specialist for BUNN.

  1. Plant-Based
Plant-based is having a major moment in the food and wellness space, and it’s influencing the coffee industry as well. Customers want their alternative plant-based milks and creamers to go into their premium brew. With so many varieties, hemp, macadamia, cashew, walnut, to name a few, choose a few of the basics (almond, oat, soy) and alternate as customers’ request.
  1. Exotic Tastes
When travel was heavily restricted during the COVID-19 pandemic, consumers traveled through their food, and now the habit has stuck. Coffee brands are now showcasing coffee beans from countries such as Indonesia, Ethiopia and Guatemala, as well as including global flavors such as matcha and chai.