The Buzz on Millennial Coffee Consumption

Posted in Millennials on January 16, 2017

Nothing seems to perk up profits and spread good cheer among foodservice operators like holiday coffee sales. Last year, one of the jolly juggernauts in the coffee category saw sales spike 12% during the holiday season to $5.47 billion.¹  

The same coffee giant’s gift cards proved especially popular: one in six adults across the U.S. received an iconic card over the holidays, up from one in seven last year.¹ U.S. and Canadian gift givers gave a record $1.9 billion worth of its gift cards during the quarter.¹ The strong showing helped the company post a net income of $688 million to beat Wall Street estimates on its bottom line.¹

The good cheer wasn’t limited to the United States. Coffee brewed up big business for the brand globally, where sales rose 8%, surpassing the 7% analysts had anticipated.¹ Not to be outdone, nearly every foodservice chain gets in the holiday spirit with festive specialty blends meant to bring the joy of java to the season and more jingle to cash registers.

Who Brew? Millennials Are Driving Coffee Demand

While the holiday season comes and goes, coffee continues to stir up excitement all year round. Despite tightening supplies and rising prices, millennials seem to have an unquenchable thirst for java, accounting for about 44% of U.S. coffee demand.²

Daily coffee consumption among younger cohorts has been on the upswing for some time, rising from 34% to 48% for 18- to 24-year-olds in the eight years through 2016.²  For consumers 25- to 39-years old, it jumped from 51% to 60% during the same time period. However, adults 60 and older cut back from 76% to 64%, while the 40-to-59 age group also saw a drop.²

The coffee market is abuzz with youth-driven consumption as consumers start to experience the joy of java earlier in life. Millennials born after 1995 began drinking coffee at 14.7 years old – about three years younger than those born closer to 1982.²

Waking Up to Coffee’s Potential

Culturally, coffee may be benefiting from an on-trend better-for-you perception, among other factors. As Gabrielle Bosche, a specialist in millennial marketing, pointed out:  “It’s no wonder millennials fell in love with caffeine at an early age. Soda is unhealthy, and coffee offers the same jolt without the socially unacceptable soda addiction. Coffee has everything millennials love: status, experience and personalization.”³

The 67th National Coffee Drinking Trends report from the National Coffee Association provides further insight into the changes that have been brewing in the coffee market thanks to younger consumers, including a tripling in daily consumption of espresso-based beverages since 2008 and substantial increases in gourmet coffee consumption.⁴ With about $200 billion purchasing power each year, millennials are coveted consumers for specialty coffee beverages that can help lead to a higher check average.⁴

Cold Brew a Hot Trend Among Millennials

Chilled beverages, including frozen blended drinks and iced coffee, are a big hit with America’s largest generation, who are driving the popularity of scrumptious specialty coffee concoctions. According to Millennial Marketing:⁵

• Millennials drink iced coffee nearly twich as much as Generation X.
• Millennials have helped cold brew sales jump by 115% from 2014 to 2015, resulting in $7.9 million in total revenue. 
• More than half drink cold lattes compared to one in five among Generation X and one in 10 among Baby Boomers.

Millennial mania for chilled gourmet coffee products, authenticity and innovation has been a major driver of the foodservice trend of cold brew coffee. No average Joe, cold brew has a cooler and slower (typically 24 to 48 hours) extraction method that accentuates the bean flavors while minimizing the bitter bite and acidic jolt of a regular cup of java. It elevates coffee from a ho-hum staple to an artisan or craft beverage that taps into the millennial thirst for higher-quality ingredients and unique flavor experiences.

Have any coffee promotions brewing to put more jingle in your cash register this holiday season? Noticed any buzz-worthy coffee consumption patterns among your millennial customers? Stir your comments into the mix below.