Saturday 15 June 2024
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Costa Coffee’s new report takes a deep dive into the UK’s coffee consumption habits

Unlike other hospitality venues, coffee shops have weathered the storm of weakened consumer confidence and economic turmoil in recent years. The total number of coffee shops across the UK grew by 353 in the last 12 months, and market researchers Allegra predict there will be over 11,600 coffee retail outlets across the UK by January 2029

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LONDON, UK – Costa Coffee has launched ‘Lattenomics’, a report exploring the UK’s changing coffee consumption habits, the influences that shape it, and the impact on wider high street and societal culture.

Using sales ratios and aggregated data from every Costa Coffee store and franchise partner over the last 24 months, the report provides an unparalleled insight into consumer trends in the post-pandemic era.

The findings reveal:

  • An increased presence of coffee shops on our high streets, and how our use of coffee shops is changing.
  • How coffee shops are responding to the rise in hybrid and remote working.
  • Customers want more from their coffee, and how this is driving innovation.

Coffee as a cultural catalyst

Unlike other hospitality venues, coffee shops have weathered the storm of weakened consumer confidence and economic turmoil in recent years. The total number of coffee shops across the UK grew by 353 in the last 12 months, and market researchers Allegra predict there will be over 11,600 coffee retail outlets across the UK by January 2029[1].

Nick Ridley, Property Director for Costa Coffee says: “High streets are often portrayed as struggling, but with the right mix of retail and hospitality they will continue to thrive. That’s why brands like Costa Coffee have a crucial role to play from an economic and a social point of view”.

Costa Coffee data shows consistency in weekend footfall over the last two years, suggesting that weekend trading remains strong despite cost-of-living pressures. Footfall post 5pm has also increased, with 5.4% of under 35-year-olds visiting coffee shops in the early evening which, coinciding with a decline in alcohol consumption amongst younger consumers[2], presents an exciting role and function for coffee shops within the evening economy.

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Ridley adds: “Coffee shops can play a greater role in the early evening space with younger consumers who don’t want to drink alcohol but are still looking for the sociability that a pub has to offer. Here’s our opportunity to provide what our customers are looking for – a place where they can be productive, creative, or just have fun.”

A convenient cup

On-the-go consumption has grown exponentially since the pandemic, due to the rise in hybrid and remote working. As a result, the number of Drive-Thru outlets nationwide has grown 15.1% over the last 12 months, of which Costa Coffee operates 43% of these.

Costa Coffee also has over 14,800 self-serve Costa Coffee Express machines across the country, to deliver an authentic coffee shop experience at the touch of a button.

With that, the RTD (ready to drink) market is also seeing considerable growth amongst time-strapped consumers. Sales data from Costa Coffee shows that 20% of under 35 buy RTDs, compared to just 6% of over 55s.

Andrew Miller, Director of Costa Express & Costa Corporate Partnerships says: “While there are still consumers who want to visit stores, we also see customers who are time poor, so speed of service, technology and convenience are really important. The rollout of our Costa Express machines, which is rooted in travel & convenience, has allowed us to reach these customers and continue to serve as a brand that delivers for all customers”.

In response, technological advancements enable brands like Costa Coffee to provide a greater speed of service for customers whilst maintaining the same quality as an in-store beverage, offering the same customisation options.

Miller adds: “As a result we are working towards advancing our Costa Coffee Express service, so that people expect to be able to order almost the same drink, and have the same experience from a machine, as they would from a coffee shop.”

3. The Costa-misation of Coffee

While two-thirds of UK consumers stick to a classic Latte or Cappuccino, they are becoming more adventurous with their changing coffee tastes, according to Costa Coffee.

Sales data shows that over a third (36.4%) of UK consumers customise drinks aligning with their milk preferences, with oat milk named most popular (31.4%). Similarly, flavour trends continue to disrupt the market, and Costa Coffee data shows that 40% of customers like to add a flavour syrup to their hot beverage when given the chance, with most popular flavours being caramel, vanilla, and hazelnut. However, the data also shows that flavour syrups are most popular with younger consumers (34% Gen Z vs 5.3% over 55s).

Moreover, research from the Costa Coffee’s Store Of the Future, a new store re-design programme launched in 2019, also found that people are twice as likely to customise their coffee when ordering via a digital ordering screen, rather than over the counter, sighting judgement as a barrier to customisation.

Sandra Ferreira, Beverage Innovation Director at Costa Coffee says: “Alongside customisation, people also want a multi-sensory experience with their drinks and we’re seeing a growth in demand for texture in drinks with the addition of cold foams and bubbles, e.g. a Tropical Mango Bubble Frappe with bubbles, or Iced Whipped Lattes.”

The results of the Lattenomics report reflect huge socio-economic changes in the UK and the need for the industry to innovate to continue meeting the growing demands of consumers.

“We’re on so many high streets, and we’re one of the most loved brands, so we have a responsibility to give people a reason to go back” says Ferreira. “Costa Coffee’s role is to continue to be the go-to place where people connect.”

The report is available from 21st May on the Costa Coffee website. To find out more please visit https://costanewsroom.vuelio.co.uk/press/press-releases/4dbda2b7-a830-458a-a913-5becb27086fd/lattenomics-the-state-of-the-nation-from-the-eys-of-a-coffee-cup

[1] Allegra World Coffee Portal report, January 2024
[2] https://www.drinkaware.co.uk/research/alcohol-facts-and-data/alcohol-consumption-uk#howmanypeopledonotdrinkalcohol

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