More people are making coffee at home. How important is this?

The COVID-19 crisis has significantly changed coffee consumer behavior since 2020. At the height of the pandemic, 95% of coffee shops temporarily closed, forcing more people to brew coffee at home.

Although many countries have returned to normal and most cafes and bakeries remain open, home consumption remains high.

According to the National Coffee Association's 2024 report, 83% of consumers reported drinking coffee at home the day before, up 4% from January 2020. Although non-resident consumption has increased since January 2021, it is still lower than it was a year ago.

In recent years, household consumption has been a major driver of market growth. The prosumer segment is growing rapidly as consumers are more willing to pay for high-quality coffee and equipment. Since the pandemic, the sale of coffee beans and specialized equipment has also attracted a new audience. This demonstrates that more and more people are preparing coffee at home.

To understand what this means for the industry as a whole, I spoke with Bill Murray, president and CEO of the U.S. Coffee Association, and Vanusia Nogueira, executive director of the International Coffee Organization.

How is Covid-19 changing coffee drinking habits?

Bill Murray has been president and CEO of the National Coffee Association (NCA) for over a decade. He noted that while the home has long been the most popular place for coffee consumption, data shows the market had been growing steadily even before the pandemic.

Retail coffee sales in Europe have grown by 140% since 2010, according to figures released by the Specialty Coffee Association at the end of the last decade. However, COVID-19 has led to further growth as the number of home coffee producers exceeds all expectations. "In January 2021, the number of people in the U.S. who reported drinking coffee at home reached an all-time high of 85%," said Bill.

This shift is also occurring in many markets around the world. Sales of premium coffee beans and equipment have increased as more consumers seek to replicate café-quality beverages. Vanusia Nogueira is Executive Director of the International Coffee Organization and former Director of the Brazilian Specialty Coffee Association.

He highlighted the huge increase in sales of appliance brands during the pandemic. For example, he shows that sales of Melaleuca's European coffee division (focused on the local market) increased from €171.5 million in 2019 to €215.3 million in 2021. Business)) Sales fell in the same period expected after the company was forced to close.

The rise of the prosumer

Making your own coffee is less of a luxury than buying a barista-prepared beverage. However, this perception appears to be changing as consumers become more interested in preparing café-quality drinks. To this end, many bakeries and cafes have implemented online education platforms for consumers during the pandemic.

Therefore, it not only increases general awareness of specialty coffee, but also improves consumer knowledge and skills. "The rise of home brewing has changed the way coffee is enjoyed and increased consumer knowledge about coffee," Vanuscia stated. "This is a positive development with potential long-term benefits for the industry."

Trends driven by the "experiential" phenomenon, which has led consumers to seek out new, often educational, product experiences at home, have helped increase coffee education over the past four years. Quarantine restrictions have led some people to spend more time and money brewing coffee at home. This has created a new trend among so-called prosumers.

Pro-consumers fall between industry professionals and typical consumers, and can be described as people who try to recreate the coffee shop experience at home.

Consumers often invest in sophisticated, semi-professional coffee-making equipment and accessories, which often include features for commercial use. "The wave of coffee-centric content on social media reflects consumer culture," said Vanusia. At a time when many people were looking for new ways to connect with like-minded fans, participation in online coffee communities was a key driver of the home user base.

The way we make coffee at home has changed.

The NCA's latest report shows that drip coffee remains the most popular home brewing method in the United States. It was chosen by 59% of respondents, up 15% from 2023.

Single-serve coffee makers grew 30% this year and became the second most popular option. At the same time, instant coffee sales increased by 31%. Vanusia has also seen a significant increase in coffee consumption, especially from pour-over coffee machines. "Increased awareness about coffee and the resulting changes in purchasing habits are driving this preference," she stated.

The rise of pro-consumerism has also created a gap in the high-end coffee maker market. Electric grinder manufacturer Baratza has experienced its largest growth in six months during the pandemic, up 70% since the COVID-19 outbreak.

This growth includes preparing espresso at home. The time, money, and skill required to prepare an espresso drink are usually enough to convince most consumers to visit a coffee shop. But Vanusia states that "espresso has found its place in home brewing, especially with the popularity of capsules."

What does this mean for the coffee industry?

The pandemic and the resulting interest in home brewing have led to a dramatic shift in coffee drinking habits that is reshaping the entire industry. “Despite all the changes the pandemic has brought, it hasn't changed the amount of coffee people drink,” Bill reminds us, “which is roughly two cups per adult per day, or roughly three cups per coffee drinker per day.”

While there are signs that consumer awareness and the consumer market have grown significantly, it is unlikely we will see sustained demand for high-end devices. After an initial surge during the pandemic, there are indications that coffee machine sales have since slowed. This is largely due to the gradual reopening of hospitality venues and the return to work.

Household consumption and the number of people brewing coffee are still above pre-pandemic levels. One reason is rising costs and limitations on consumer spending. As coffee prices are likely to remain high for the foreseeable future, consumers will continue to spend less.

At first glance, it might seem like coffee shops and roasters should be concerned about growing domestic consumption. However, Bill notes that they've found ways to adapt this work. "It's important to offer multifaceted solutions, such as introducing new coffee configurations to consumers and promoting subscription programs," he stated.

Final conclusion

Due to the epidemic and the resulting rise in costs, domestic coffee consumption remains high. As more people brew their own coffee at home, changes in consumer behavior are increasingly influencing the market.

Both the equipment industry and the coffee market need to rethink their strategies. Furthermore, with the rising cost of living and high inflation rates in key consumer markets, brands will need to ensure this trend continues.

Translated by Almudena Torreciela Aznar.

Translation edited by Alejandra Soto.

Credits: PDG Español

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