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COFFEE AND COFFEE SHOPS - CANADA - SEPTEMBER 2018

Published By :

Mintel

Published Date : Sep 2018

Category :

Beverages

No. of Pages : N/A

Canadians love coffee, though what they expect of the category varies. Some look to explore and experiment with new and different types of coffee, while for others, coffee is a ritualistic morning pick-me-up that they don’t want to mess with. Whether one is actively interested in exploring new innovations in the category is highly dependent on one’s age or generation. Younger consumers, for instance, prove to be more interested in newer types of coffee, while this passion for exploration softens with age. Furthermore, foodservice is the means by which many young Canadians are introduced to coffee and, as such, these out-of-home brands prove to be particularly important as consumers shift to in-home consumption behaviour as they age. More than ever, the in- and out-of-home occasions appear to be linked, supporting the importance of having a multi-channel strategy to support sustained growth.

Table of contents
OVERVIEW
What you need to know
Definition
Consumer data:
Market size:
EXECUTIVE SUMMARY
Overview
The issues
Younger consumers are somewhat less likely to drink coffee
Figure 1: Share of consumers that don’t drink coffee, by age, June 2018
Two-thirds of consumers look to limit their coffee intake
Figure 2: “It is important to limit the amount of coffee you drink” (% agree), by gender, June 2018
Just one-fifth of coffee drinkers show active interest in innovation
Figure 3: Interest in coffee innovation, June 2018
The opportunities
Coffee sales are growing in Canada
Figure 4: Total Canadian volume sales and fan chart forecast of coffee market, at current prices, 2012-23
Most Canadians are willing to pay for premium coffee
Figure 5: Attitudes towards coffee (% agree), June 2018
Coffee innovation is an opportunity to reach younger consumers
Figure 6: Interest in coffee innovation, by age, June 2018
What it means
THE MARKET – WHAT YOU NEED TO KNOW
Coffee sales continues to grow
Coffee shop sales also experience sustained growth
Perceived financial health improves in 2018
MARKET SIZE AND FORECAST
Coffee sales continue to grow
Figure 7: Retail Canadian value sales and fan chart forecast of coffee market, at current prices, 2012-23
Figure 8: Retail Canadian value sales and forecast of market, at current prices, 2011-23
Figure 9: Total Canadian volume sales and fan chart forecast of coffee market, at current prices, 2012-23
Coffee shop sales also experience sustained growth
Figure 10: Canadian value sales and fan chart forecast of coffee shop market, at current prices, 2012-23
MARKET FACTORS
Perceived financial health improves in 2018
Figure 11: Perception of financial health, January/February 2015-18
Figure 12: How extra money is spent (selected categories), 2018 vs 2017, January 2018
KEY PLAYERS – WHAT YOU NEED TO KNOW
Focus on experience driving increased consumer engagement
Coffee’s third-wave delivers new innovation
Coffee expanding into new formats, flavours and benefits to broaden base of drinkers
WHAT’S WORKING?
Focus on experience driving increased consumer engagement
CHALLENGES
Tim Hortons’ brand takes a hit with Canadians
Starbucks receives negative press due to in-store incident
WHAT’S NEXT?
Coffee’s third-wave delivers new innovation
Figure 13: Four Sigmatic Mushroom Coffee Mix with Cordyceps and Chaga (US), May 2016
Lines will continue to blur between the in- and out-of-home coffee experience
Coffee expanding into new formats, flavours and benefits to broaden base of drinkers
Figure 14: Coca-Cola Plus Cola Drink (Australia), November 2017
Figure 15: Starbucks Double Shot White Chocolate Flavoured Energy and Fortified Drink (Canada), April 2018
Figure 16: La Colombe Triple Draft Latte (US), March 2018
Figure 17: Upruit Mint Ginger Hibiscus Sparkling Coffee (US), January 2018
Figure 18: Rise Brewing Co. Seasonal Nitro Blood Orange Coffee (US), October 2017
Figure 19: President’s Choice Nitro Black Cold Brew Coffee (Canada), June 2018
Figure 20: Stok Cold Brew Espresso Creamed Protein Coffee Beverage (US), March 2018
Figure 21: Hershey’s Organic Forto Coffee Shot Chocolate Latte (Canada), June 2018
Figure 22: REBBL Reishi Cold-Brew Super Herb Powdered Coconut-Milk Elixr (US), October 2017
The process for making coffee can enhance its perception
THE CONSUMER – WHAT YOU NEED TO KNOW
Engaging younger consumers is key to driving growth
Price and brand prove most important when choosing coffee
Most consumers look to limit their coffee consumption
Canadians have different perceptions of operators
COFFEE USAGE
Engaging younger consumers is key to driving growth
Figure 23: Non-coffee consumption, by age, June 2018
Figure 24: Where coffee is consumed, by age, June 2018
Age influences the coffee format consumers choose
Figure 25: Coffee consumption at home, June 2018
Figure 26: Coffee consumption at home, by age, June 2018
Figure 27: Coffee consumption at home, by household income, June 2018
Figure 28: Coffee consumption at home, by parental status, June 2018
Tim Hortons continues its dominance in out-of-home coffee
Figure 29: Where coffee was purchased when out of home, June 2018
Figure 30: Where coffee was purchased when out-of-home, by age, June 2018
Chinese Canadians are more likely to get coffee from foodservice
CONSIDERATIONS WHEN CHOOSING COFFEE
Price and brand prove most important when choosing coffee
Figure 31: Important considerations when choosing coffee, June 2018
Figure 32: Importance of price and brand, by age, June 2018
Canadians prefer strong-flavoured coffee
Figure 33: Coffee flavour preferences, by generation, June 2018
Figure 34: Importance of new coffee flavours, by generation, June 2018
Figure 35: Nestlé Coffee-Mate 2 in 1 Coffee + Creamer with French Vanilla Flavour (US), July 2018
“The bean” proves most important when communicating origin
Figure 36: Origin considerations, under-45s vs over-45s, June 2018
Figure 37: Importance of bean type, by household income, June 2018
INTEREST IN COFFEE INNOVATION
Areas of interest in innovation clustered together
Figure 38: Interest in coffee innovation, June 2018
Younger consumers more interested in coffee innovation
Figure 39: Interest in coffee innovation, by age, June 2018
Less traditional options hold particular appeal with the iGeneration
Figure 40: Interest in cold-brew coffee and coffee blended with other drinks, by generation, June 2018
Figure 41: Keepers Citrus Sparkling Coffee (US, November 2017)
Coffee with perceived health-related benefits hold particular appeal with young women
Figure 42: Almond Bliss Cold Brew Coffee Almond Beverage (Canada, October 2017)
Figure 43: Interest in coffee made with dairy alternatives and functional benefits, women 18-24 vs overall, June 2018
Figure 44: Reflex Nutrition Protein Coffee (UK, June 2018)
Out-of-home branding bridges the gap between coffee at in-home and foodservice
Figure 45: Where coffee is consumed, by generation, June 2018
Figure 46: Interest in restaurant-branded coffee cold in store, by generation, June 2018
ATTITUDES TOWARDS COFFEE
Most Canadians discern between “good” and “bad” coffee
Figure 47: Attitudes towards coffee (% agree), June 2018
Figure 48: Coffee shops have higher quality coffee than what is typically made at home (% agree), by generation, June 2018
Figure 49: “There is a noticeable difference between good and bad coffee” and “the way coffee is brewed impacts its quality” (% agree), by generation, June 2018
Most consumers look to limit their coffee consumption
Figure 50: “It is important to limit the amount of coffee you drink” (% agree), by gender, June 2018
THE FOODSERVICE ENVIRONMENT
Canadians have different perceptions of operators
Figure 51: Correspondence analysis – Symmetrical map – Coffee and coffee shops, July 2018
Figure 52: Association with coffee shops, July 2018
Age impacts associations made with operators
Starbucks
Figure 53: Association with Starbucks, iGeneration vs overall, July 2018
McDonald’s
Figure 54: Association with McDonald’s (select), over-55s vs overall, July 2018
Tim Hortons
Figure 55: Association with Tim Hortons (select), over-55s vs overall, July 2018
Price is a concern, but not a barrier to drinking coffee at foodservice
Half of consumers say there are not enough seats at coffee shops
Figure 56: Coffee shops often don’t offer enough places to sit (% agree), students vs non-students, July 2018
APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Consumer survey data
Consumer qualitative research
Correspondence analysis
Abbreviations and terms
Abbreviations
Terms

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