Coffee Pods Brew Up A Storm For The Consumer

Colored coffee capsules blurred for background
Photo by Thiago Rocha Dos Santos. C/o www.123rf.com

One of the recent drivers for a surge in kitchen equipment has been the rise of the coffee pods or single-serve pods. Whilst we might not all be as good looking as George Clooney, we can still feel ourselves becoming suave and sophisticated as we sup our tiny cup of coffee. The single-serve pod is also highly convenient and dispenses with the one spoon or two concept. There is consistent quality with every cup !

The product development in this arena continues with Tassimo for example, which is owned by Jacobs Douwe Egbert, launching a Costa Vanilla Latte variant. This adds to many others they have launched to give us a coffee house feel to our daily fix of caffeine. As with all their offers, the new flavour comes in 8 x 310ml cup sizes (equivalent to 16 pods).

Why continue to launch new brands on top of already novel flavours ? The market demand for single-serve coffee solutions which is currently growing at 17.35% in value terms in the UK is possibly the fastest grocery at the moment. Everyone seems to be buying one or replacing them as slicker, newer models come onto the market. At the moment, 17 per cent currently do so and 19 per cent would like to. It is thought that the ownership level in three years time might be closer to 33 per cent.  In the United Kingdom, the market is currently £170.38m  but could well be £210m in 3 years time most certainly. That growth is fed by the increasing range of flavoured coffees and then there are the seasonal variants such as pumpkin latte available in the autumn or Christmas tree flavour.

One of the issues that may pique our conscious is the difficulty of disposing single-serve pods. The research group, the Kantar Worldpanel indicated that brands like Tassimo, Dolce Gusto and Nespresso will overtake ground coffee. Here, they recorded an increase of 29.5 per cent in the last year, with sales at £137.5 million of these three brands alone. Covering the same period, roast and ground coffee sales only rose by 2.5 per cent with a total market of £167million. Given this rate, the single-serve pods overtook sales by late 2018 an continue to surge onwards.

We can also expect to see the coffee houses offering their own variants under license. The smaller boutique like brands certainly have their own versions which offer novel, gourmet flavours. Starbucks launched their Nespresso compatible capsules in the UK not that long ago. It already has the Verismo device which needs some work to improve its sales compared to other machines.

They have witnessed the same sales increases in these pods as everyone else and realise it’s time to enter the market. Clearly, others will follow if they haven’t done so already. What hasn’t happened yet are the own-label pods from Tescos or Sainsburys just yet. It may be due to lack of machine and quality issues and of course cost. The difference in costs of instant coffee compared to the pods is significant.  According to Kantar, an issue is the differing price of coffee pods: “An average cup of regular instant coffee costs only 2p. A café-style instant is 17p while the fastest growing sector – pods – cost an average of 31p per cup.”

One of the other interesting developments may be the rise of pods with other coffee mixes. Cannabis coffee is certainly available –in pods – just look at the North West Americas for your cue.

If you are interested we have a page which enables you to purchase various coffee pods through our affiliate marketing partner.

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