The coffee market is constantly changing, with generational trends, technologies, and political events influencing the way it behaves. It is essential for globally connected businesses, such as specialty coffee, to be quick to adapt to these changes in order to thrive.
In today’s coffee market, several changes are being driven by a younger generation of consumers, also known as Gen Z. In the UK, for instance, over 50% of Gen Z coffee consumers claim they never drink coffee at cafés, while 46% say they never consume it at home or work. In the US, two-thirds (63%) say they don’t drink coffee at all.
However, the Gen Zers who do consume coffee are found to be twice as likely to prefer “gourmet” coffee – non-instant Arabica, in this instance – than those over the age of 60. Research suggests taste, price, and convenience are at the top of Gen Z’s coffee-buying motivations. This indicates that while they may not drink vast quantities of coffee, the quality of the coffee they do drink is important. And, with a disposable income of more than $360 billion globally, it’s important for the long-term success of coffee businesses to pay attention to their habits.
To understand more about how roasters and coffee shops can appeal to this new generation of coffee consumers, I spoke with Juan Sebastian Hernandez, the owner of Café del Mercado in Bogotá, Colombia.
What are the key characteristics of Gen Z coffee consumers?
Generation Z refers to those born between 1996 and 2010. The digital age, anxiety about climate change, and a shifting financial landscape have largely shaped this generation’s identity. Several studies suggest Gen Z makes up more than a quarter of the US population and will contribute an estimated $44 billion to the national economy.
Gen Z grew up being exposed to the internet, various social media platforms, and are constantly connected through mobile devices. These factors have influenced how they behave and interact with their surroundings. As they are hyper-connected, this generation has become more aware of global issues that affect them not only as a society but also as individuals.
It is important to note Gen Z is less likely to form opinions of a company based solely on the quality of the product or service. Notably, the focus is on the brands’ ethics, business practices, and social impact. “Sustainability and social justice are just some of the concerns that are driving the consumption behaviour of this generation,” Juan explains. “It is essential for roasters and coffee shops to address these topics if they want to continue to appeal to a dramatically changing market.”
Another factor that is increasingly important for Gen Z coffee consumers is convenience. In an article for the NCA’s blog, Scott Mark explains that the fast-paced lifestyles of younger consumers are shaping their coffee-drinking habits. “They’re accustomed to a world of instant gratification,” he writes. “Online shopping with two-day delivery is the norm, and groceries can be delivered without having to leave the house. Gen Z favours simple, convenient meals that match their on-the-go lifestyle. More so than other generations, Gen Z meals include ready-to-eat snack foods.”
In 2018, ready-to-drink (RTD) and cold brew coffee were Gen Z’s most frequently purchased drinks, according to Technomic’s 2018 Generational Report. RTD and iced coffees are often perceived by consumers to be healthier than carbonated soft drinks and energy drinks, while still providing a caffeine boost. More than 65% of 18-24-year-olds in the UK believe that iced coffees are a better alternative to sugary drinks.
So, finding ways to lower the barriers between convenience and the consumption of high-quality coffee has become a focus for many coffee roasters.
How is Gen Z shaping the specialty coffee industry?
The specialty coffee industry is constantly evolving to suit consumer trends. As Gen Z consumers tend to favour experiences over physical products, roasters and coffee shops must adapt to cater to this need. Gen Z coffee consumers want to understand more about what is in the cup: they want to dive into the stories of producers and understand more about origins, varieties, and processing methods.
There are several experimental processing methods being used in the coffee industry, including carbonic maceration and kombucha fermentation. “By collaborating with farmers, roasters will be able to provide Gen Z consumers with exciting coffee options, while teaching them about the supply chain,” Juan suggests.
This ties in with Gen Z’s intense focus on sustainability and transparency along product value chains. This increasing demand from Gen Z consumers is creating an incentive to develop a more collaborative coffee industry.
What strategies can roasters use to address Gen Z coffee consumers?
One of the most effective ways roasters can connect and engage with Gen Z consumers is to have a clear and effective social media strategy. A large presence across various social media platforms, such as Instagram, TikTok, Facebook, Snapchat, and Twitter is essential to increase the visibility of a brand.
These platforms serve as powerful marketing tools that can help create experiences beyond the cup. “Roasters and coffee shops can develop online education programmes to explain the processing methods used by their green coffee suppliers and share information about the farm,” Juan says. Alternatively, these platforms can be used to teach consumers about alternative brewing methods.
Creating coffee packaging that is “Instagrammable” can be an effective way of marketing your brand. Custom-printed coffee bags will not only stand out on the shelf but also give younger customers an excuse to share them with their followers across social media.
Generation Z is an increasingly influential demographic in the coffee industry and their demands for increasing sustainability, transparency, and quality are crucial to the future of the specialty coffee sector.
At MTPak Coffee, we offer a range of different sustainable packaging solutions that cater to the demands of Gen Z coffee consumers. Our range of packaging options is made from renewable materials. Our coffee boxes are made using 100% recycled cardboard, while our sustainable coffee bags are made using kraft paper, rice paper, or multilayer LDPE packaging with an environmentally friendly PLA lining.
From shaped pouches for RTD to recyclable takeaway cups, our coffee packaging is fully customisable to help maximise the coffee-drinking experience. Our range of customisation techniques includes spot UV with a glossy, satin, or matte finish, embossing and debossing, as well as hot foil stamping in a variety of colours.
For more information on sustainable, custom-printed coffee packaging, contact our team.