Coffee sales have begun to slow after years of growth, with rising sales in 2023 stemming from price increases rather than organic growth, revealed Mintel in its “2023 Coffee and RTD Coffee — US” report.
The future of the category depends on positive factors, such as improved economic conditions and young consumers entering the market, as well as negative factors, including the impact of climate change and competition from energy drinks.
Therefore, as c-stores look to boost sales and rally customers around hot beverages in 2024, one focus can be on popular flavor trends.
In its report, Mintel discovered that indulgent flavors are trending, reflecting consumer, especially Gen Z, interest in treat-like coffee beverages. Recent top novel flavored roast launches include white chocolate, fudge, sea salt (fleur de sel), pumpkin pie and sugar. Top emerging flavored roast launches include chai (masala/spice), cocoa/cacao, nut, muffin and s’mores.
The report found that 63% of Gen Z and 54% of millennial consumers prefer their coffee with added flavors from flavored creamers, roasts and syrups. As a result, Mintel suggested that brands should “look beyond coffee itself to creamers and additions.”
Catering to Customers
As far as equipment, many retailers are turning to bean-to-cup technology, but Ray McIntosh, president of McIntosh Energy, parent company of MacFood Mart’s four convenience stores in and around Ft. Wayne, Ind., believes that many customers still prefer drip coffee.
“Not all customers want to wait for the bean-to-cup equipment to brew, or they find the resulting coffee to be too heavy in flavor,” McIntosh explained.
However, to appeal to the largest number of customers, he has both technologies in each of his stores.
For its bean-to-cup brews, MacFood Mart partners with a well-known local roaster highly regarded for its quality products. In addition to its regular offerings, the roaster introduces limited-offer seasonal specialties that McIntosh noted are very popular.
The stores also feature seasonal versions of machine-made cappuccinos such as peppermint and pumpkin spice. For the drip coffees, a variety of flavored creamers give customers opportunities to create their own perfect cup.
Special Offers
McIntosh appeals to economy-minded customers with numerous special offers. Enrolled loyalty members can get a free cup of coffee every Friday, a promotion that he described as “incredibly popular.” Also well received is the chain’s Coffee/Cappuccino Club, offering loyalty members who purchase 10 cups their next cup free, said Jessica Carroll, the company’s marketing manager.
“Overall, 86% of our loyalty users have taken advantage of this club program at least once,” she stated.
The stores also bundle coffee with breakfast foodservice items, offering either the coffee or the food item for free or the coffee for 99 cents.