With more people preparing coffee at home because of the pandemic, the market for fun-flavored creamers and beans — Almond Joy! S'Mores! Strawberry cheesecake! — is exploding as we bring our Dunkin' Donuts and Starbucks taste buds to the living room.
Why it matters: American coffee consumption is at a two-decade high, per the National Coffee Association, and more of us are now drinking it at all hours of the day, sometimes instead of a sugary snack. That's a pandemic-era habit shift that's likely here to stay.
- Coffee consumption after breakfast is up 15% since last July, the coffee association said.
- Young people are lapping it up, stoking demand for sweet, nostalgia-oriented products — how about some Fruity Pebbles creamer?
- Companies that make refrigerated creamers, flavoring syrups and coffee makers say sales have risen as Americans have learned to become in-home baristas.
What's happening: Sensing that our home-brewing habits are here to stay, consumer goods companies are flooding stores with new coffee products catering to our sweet tooth — and disguising the original taste.
- While coffee purists scoff, younger consumers are snapping up liquid stir-ins in flavors like Twinkie, Cinnabon, M&M's and Cinnamon Toast Crunch.
- Among 18- to 24-year-olds — Gen Z — coffee consumption is up 14% since January 2021.
- They're not the only ones craving the sweet stuff: "Millennials are driving the current, all-time high penetration of flavored creamers," says Leonardo Aizpuru, leader of the creamer unit at Nestlé, which makes Coffee mate and other brands.
- Taste, he said, "is a top purchase driver."
A product arms race has broken out among brand-name giants:
- In partnership with Kellogg's, Nestlé recently introduced creamers that taste like Rice Krispies Treats, Golden Grahams and Drumstick ice cream.
- Danone, which makes International Delight, partnered with Warner Bros. on a limited edition line of Wonka Whipple Scrumptious Fudgy Caramel Creamers — after success last year with Fruity and Cocoa Pebbles.
The big store chains are playing too:
- Starbucks just rolled out a Chocolate Cream Cold Brew.
- Dunkin' Donuts' new Cake Batter Signature Latte comes with rainbow sprinkles.
The other side: Plant-based and zero-sugar creamers are also in hot demand, manufacturers say.
- And 19% of coffee drinkers take it black, per the National Coffee Association.
What they're saying: There's been a "pandemic-caused meaningful shift toward in-home preparation" of coffee — poised to continue even as people venture back to the office, says David Portalatin, a food industry specialist with The NPD Group consultancy.
- When coffee shops started closing in 2020, consumers found "they didn’t necessarily have all of the equipment and all of the flavors and ingredients to make that specialty coffee they were missing," Portalatin tells Axios.
- Two years later, he adds, there is still "some emphasis right now on, how do we help consumers recreate that specialty coffee experience and still do it at home?"
- Says Danone North America CEO Shane Grant: "Surprisingly, many Americans don't love the underlying taste of coffee. In fact, 70% of consumers modify or cream their coffee to enhance the taste and texture versus drinking it plain."
Fun fact: A recent study found that coffee drinkers had a lower mortality risk than coffee shunners — whether they drank it sweetened or not.
What's next: The pandemic helped spawn a number of coffee trends, some with potential staying power: coffee subscription boxes, homemade cold brew, half-caf.
- Others — like Dalgona coffee and butter coffee — may be more ephemeral.
