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Trends In The Coffee and Tea Industry Outlook For 2020

The global coffee and tea industry includes ready-to-serve products, instant and brewed ingredients and any number of dedicated shops that serve the beverages exclusively or as part of their beverage service. According to Business Wire’s “Coffee and Tea Global Market Report 2020-30: COVID-19 Impact and Recovery” report, the total coffee and tea market is predicted to grow from $142.1 billion in 2019 to $148.5 billion in 2020, an annual growth rate of 4.6 percent.

The rate is actually low because of the Coronavirus closings, but the industry should bounce back to an average growth rate of 9.0 percent yearly to reach $191.1 billion in 2023. Entrepreneurs in all areas of coffee and tea service can plan proactively for business success by capitalizing on industry statistics and 2020 beverage trends.

The Statistical View

The following statistics provide dramatic insights into the benefits of conducting business in the coffee and/or tea industry:

  1. Coffee Shop Popularity – According to myfriendcoffee.com, about 60 percent of U.S. coffee drinkers visit a chain coffee shop at least once a month.
  2. Drive-throughs Remain Immensely Popular – Statistics show that 50 percent of Americans get their coffee from drive-through operations.
  3. Global Demand for Coffee – Despite the demand for coffee in the United States, the country only ranks 25th in per capita coffee consumption. That means 24 countries have higher consumption rates that are worth targeting.
  4. Millennial Tea Drinking Stats – Tea continues to gain market share in surprising areas. For example, according to foodtruckempire.com, about half of U.K. tea brands are purchased by millennials in the 24- to 35-year-old demographic group.
  5. Tea Industry Stats – The tea industry generates $52.1 billion annually, and the revenue is predicted to grow to $81.6 billion by 2026.
  6. Global Tea Consumption – Statistics show that annual tea consumption tops 41 million liters annually.
  7. Even Younger Tea Drinkers Are on the Bandwagon – Generation Z has helped to fuel the demand for sparkling bottled iced tea beverages like Lipton Sparkling Tea, Sound Sparkling Tea, Kombucha Wonder Drink Sparkling Fermented Tea and many other brands.
  8. Tea Market Types – There are many varieties of tea, such as black, Oolong, green, herbal and fruit teas, but black tea is the most popular because of its antispasmodic, antiviral and antiallergenic properties. Increased demand for green tea is attributed to its health benefits, which include better cardiovascular health and weight loss.
  9. Daily Coffee Consumption – According to brandongaille.com, the average daily consumption of coffee is 3.1 cups.
  10. Demand for Specialty Coffee Beverages – More than half of all coffee consumption in the United States includes specialty beverages like espresso, cappuccino, iced/cold coffee and lattes at premium prices.

Coffee and Tea Trends of 2020

The coffee and tea trends of 2020 range from molecular nitrogenation to more sustainable sourcing practices. Nitrogenation delivers a smoother, creamier mouth feel without adding empty calories. Consumers are also looking for better presentations of both tea and coffee beverages. Talented baristas create customized images in cappuccino and latte foam. Adding seltzer to tea and coffee also is used to make drink concoctions sparkle and fizz.

Beverages of all kinds are taking beverage sales to the next level. Consumers can buy brain-enhancing energy drinks, molecular cocktail creations and zero-alcohol beverage options. The coffee and tea industry can keep up with these trends by embracing coffee and tea trends. Aficionados of coffee and tea are ready for new ideas, and the following ten trends are just a sampling of what merchants can do to increase coffee and tea sales:

1. Unique Blends of “Healthy” Coffees

Proprietary blends of coffee are becoming more and more popular. According to webrestarantstore.com, coffee and tea shops — and even full-service restaurants — increasingly offer blends to support good health and reduce fat with soy and collagen creamers. [5] Blends like mushroom coffee and macha lattes are common. Most dedicated coffee shops offer blends that increase gut health, boost metabolism and/or support the immune system.

2. Snapchilled Coffee

Freshness matters. Even if you prefer chilled coffee in hot weather, the snapchilling process is supplanting cold brewing. The process takes freshly brewed coffee and cools it rapidly, which extracts more flavor and more appealing aromas than the cold brewing process. There is also no waste of unused cold brewed coffee. Snapchilled coffee doesn’t take as long to make as cold brewed, and you don’t need to dilute the coffee by adding ice cubes. Look for this trend to become more common in coffee and tea shops everywhere.

3. Coffee Tourism Becomes a “Thing”

Millennials often approach coffee as a holistic experience, and as such, many young people seek out coffees in popular growing regions. Coffee tourism has officially become the next big trend, and millennials seek more authentic experiences in unique cafes around the world. The trend mirrors the farm-to-table movement for produce and meat production. Millennials also seek out shops that offer unique coffee and tea presentations, compelling photographs of coffee plantations, educational experiences, etc.

4. Canned and Bottled Coffee Becomes More Popular

In a society that’s always on the go, canned and bottled coffees and teas are becoming a staple of the neighborhood market. It’s easy to add these self-contained coffee and tea options to your inventory with no additional setup costs. You can add coffee and tea at gas stations, convenience stores, vending machines and other businesses that young people patronize.

5. Buttered Coffee Greases the Gears

Would you like cream, sugar or butter for your coffee? Surprisingly, buttered coffee is becoming a popular trend — especially for people on the go who don’t eat breakfast. Buttered coffee is coffee enhanced with a tablespoon of butter. According to coveteur.com, the butter makes coffee more nutritious and strengthens its effects.  Popular among celebrities and professional athletes, the trend is spreading and gaining a cult following. It’s also an easy enhancement that allows sellers to increase the price of a cup of coffee substantially.

6. Tea Cocktails and Zero-proof Drinks

According to ikedamatcha.com, tea beverages are becoming a staple of trendy bars worldwide. About 43 percent of the public doesn’t drink, and many people choose not to drink alcohol on every social occasion. There are limits to how many Virgin Marys and Shirley Temples one can consume. Tea blends offer a great variety of non-alcoholic beverages, and jealous booze drinkers can drink their favorite tea in a proprietary tea cocktail.

7. Choosing Tea for Health Benefits

Many consumers now choose tea for its complex blend of chemicals and additives like turmeric, ginger and chamomile. According to beveragedaily.com, most of these tea additives are classified as “adaptogens,” which are substances that relieve mental and physical stress.

Components in teas can be marketed to health-conscious customers. High-end teas might even include CBD oil, which is a legal and healthy ingredient derived from hemp. Shops can legally add CBD teas anywhere in the United States as long as the CBD oil doesn’t come from the cannabis plant and have psychoactive compounds. According to factmr.com, CBD-laced coffee and tea are popular among health enthusiasts and people who suffer from debilitating pain. CBD stands for cannabidiol, and, it’s a non-psychoactive ingredient in hemp and cannabis plants.

8. Consumer Demand for Increased Tea Options

According to worldteanews.com, more and more tea lovers are demanding better quality teas in restaurants, cafes and coffee/tea shops. [10] Tea aficionados are no longer satisfied with one or two choices of standard tea bags. These people want more options like loose leaf tea brewing. That’s actually good news for business owners because they can increase sales with fancier tea options instead of the common practice of serving tea as something of a loss leader. Loose leaf tea service generates high profit margins and increased customer satisfaction.

9. Ready-to-drink Tea Beverages Expand Tea Options

Ready-to-drink teas are gaining an increased share of the RTD market. These teas are easily marketed as healthful alternatives to sweet sodas. Black and green teas are the most popular, but smaller companies — like Stash Tea — are bottling proprietary blends.

10. Plant-based Proteins Gain a Wide Constituency

Plant-based additives are becoming popular for both coffee and tea. According to synergytaste.com, about 49 percent of consumers feel that plant additives need more flavor, and beverages are the perfect palette for blending plant-based flavors and increasing non-dairy creamer options. [11] Nut milks are ideal options and include soy, almond, coconut and other flavors. Forward-looking merchants can increase profit and customer satisfaction by adding more plant-based proteins.

Getting in on a Invaluable Secret

The popularity of coffee and tea is hardly a secret, but the appeal of marketing coffee and tea products for business might be overlooked. Proprietary coffee and tea shops do phenomenally well, and consumers get their coffee on the go, at food trucks, in restaurants, at coffee shops and in supermarkets. Bottled coffee and tea beverages become increasingly varied and popular. If you want to sell a great, sustainable product, coffee and tea offer marketing opportunities like no other products.