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The U.S. Market for Coffee and RTD (Ready-to-Drink) Coffee, 4th Edition
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Nov 1, 2003
246 Pages - Pub ID: LA895867
Attention: There is an updated edition available for this report.
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Chapter 1: Executive Summary
- Market Parameters
- Report Methodology
The Products
- Three Primary Categories of Coffee and Ready-to-Drink Coffee
- Lots of Activity with Ready-to-Drink Products
- Additional Descriptors
Size and Growth of Market
- 2003 Sales at $19 Billion
- Sales Approach $21 Billion by 2008
- Table 1-1: U.S. Sales of Coffee and Ready-to-Drink Coffee, 1999-2008
- Market Share by Product Category
- Table 1-2: U.S. Retail Sales of Coffee and Ready-to-Drink Coffee, 2003
- Projected Growth From Whole Bean and Ready-to-Drink Coffee
- Table 1-3: Projected U.S. Retail Sales of Coffee and Ready-to-Drink Coffee, 2003-2008
- Factors Affecting Market Growth
The Marketers
- Complex International Structure
- Marketers Are the Focus of This Study
- Size and Scope of Marketers
- Competitive Situation
- A Crowded Supermarket Aisle
- Impulse Markets for Impulse Beverages
- On-the-Fly Coffee
- Sustainable Coffees’ Popularity Increasing Fast
- Market Leaders Are Big Spenders
- Trade Advertisement Is Strong for Coffee
Distribution and Retail
- Retail Distribution Methods
- Coffee House Distribution Methods
- Supermarkets Claim Largest Retail Share
- Table 1-4: Share of U.S. Retail Sales of Coffee and Ready-to-Drink Coffee by Retailer Type, 2003
- Private Label Little Threat to Specialty Coffee Brands
- Figure 1-1: Share of U.S. Retail Sales of Coffee and Ready-to-Drink Coffee by Retailer Type, 2003
- Coffee Is Big Business at Club Stores
The Consumer
- Consumers Continue to Drink Coffee, Just a Bit Less
- Simmons Consumer Survey
- Table 1-5: Percent of Consumers Who Use Packaged Coffee for Future Brewing or Mixing by Product Type, Brand, and Region, June 2002-May 2003
Chapter 2: The Products
- Markets Analyzed
- Products Outside of Scope
Product Breakouts
- Three Primary Categories
- Loose Use of Term “Specialty”
- First Category: Coffee Packaged for Future Brewing or Mixing
- Broken Into Five Sub-Categories
- Ground Coffee.
- Whole Bean Coffee
- Instant Coffee
- Filter Packs or Bags of Coffee or Espresso Pods
- Specialty Instant Coffee Mixes
- Second Category: Packaged Coffee Beverages (Ready-to-Drink)
- Third Category: Freshly Brewed for Immediate Consumption (Ready-to-Drink)
- Additional Descriptors
- Arabica versus Robusta.
- Caffeine Content
- Roast
- Espresso
- Flavors
- Organic
- Shade Grown
- Fair Trade
Chapter 3: The Market
- 2003 Sales Ring in at $19 Billion
- Table 3-1: Total U.S. Sales of Coffee and Ready-to-Drink Coffee, 1999-2003
- Figure 3-1: Total U.S. Sales of Coffee and Ready-to-Drink Coffee, 1999-2003
- Foodservice Includes Non-Traditional Retail Establishments
- Table 3-2: Total U.S. Sales of Coffee and Ready-to-Drink Coffee by Market, 1999-2003
- Whole Bean Coffee Drives Retail Sales
- Ready-to-Drink Sales Peak at $325.7 Million
- Table 3-3: U.S. Retail Sales of Coffee and Ready-to-Drink Coffee by Product, 1999-2003
- Table 3-4: Total U.S. Sales of Packaged Coffee Beverages Ready-to-Drink by Market, 1999-2003
- The Rest of Foodservice
Market Composition
- Foodservice Is Largest Coffee Sales Channel
- Figure 3-2: Total U.S. Sales of Coffee and Ready-to-Drink Coffee by Market, 2003
- Retail, Though Less Than a Fourth, Is a Very Dynamic Channel
- Figure 3-3: U.S. Retail Sales of Coffee and Ready-to-Drink Coffee by Product, 2003
- Decaffeinated Ground Coffee Faring Better Than Decaf Instant
- Table 3-5: U.S. Retail Sales of Ground Coffee by Caffeine Content, 1999-2003
- Figure 3-4: U.S. Retail Sales of Ground Coffee by Caffeine Content, 2003
- Table 3-6: U.S. Retail Sales of Instant Coffee by Caffeine Content, 1999-2003
- Figure 3-5:U.S. Retail Sales of Instant Coffee by Caffeine Content, 2003
- Private Label Growth Is For Two Reasons
- Table 3-7: U.S. Retail Sales of Coffee and Ready-to-Drink Coffee Branded vs. Private Label, 1999-2003
- Figure 3-6: U.S. Retail Sales of Coffee and Ready-to-Drink Coffee Branded vs. Private Label, 2003
- Figure 3-7: U.S. Retail Sales of Ground Coffee Branded vs. Private Label, 2003
- Figure 3-8: U.S. Retail Sales of Ground Decaffeinated Coffee Branded vs. Private Label, 2003
- Figure 3-9: U.S. Retail Sales of Whole Bean Coffee Branded vs. Private Label, 2003
- Figure 3-10: U.S. Retail Sales of Instant Coffee Branded vs. Private Label, 2003
- Figure 3-11:U.S. Retail Sales of Instant Decaffeinated Coffee Branded vs. Private Label, 2003
- Traditional Supermarket Is the Primary Sales Channel
- Figure 3-12: U.S. Retail Sales of Coffee and Ready-to-Drink Coffee Share of Dollar Sales by Retailer Type, 2003
- Product Mix Varies Because of Ready-to-Drink Beverages
- Figure 3-13: U.S. Supermarket Sales of Coffee and Ready-to-Drink Coffee: Share of Dollar Sales by Category, 2003
- Figure 3-14: U.S. Mass Merchandiser Sales of Coffee and Ready-to-Drink Coffee: Share of Dollar Sales by Category, 2003
- Figure 3-15: U.S. Drug Store Sales of Coffee and Ready-to-Drink Coffee: Share of Dollar Sales by Category, 2003
- Figure 3:16: U.S. C-Store Sales of Coffee and Ready-to-Drink Coffee: Share of Dollar Sales by Category, 2003
- Figure 3-17: U.S. Club Store Sales of Coffee and Ready-to-Drink Coffee: Share of Dollar Sales by Category, 2003
- Foodservice Sales Strongest in C-Stores, at the Office, and in Coffee Houses
- Figure 3-18: U.S. Foodservice Sales of Coffee and Ready-to-Drink Coffee: Share of Dollar Sales by Segment, 2003
- Whole Bean Coffee More Popular in the West
- Table 3-8: Regional Distribution Indices for Consumption of Packaged Coffee for Future Brewing or Mixing by Product Type, Brand, and Region, June 2002-May 2003
Factors to Market Growth
- Retail Market Simply a Shift to Higher-Priced Coffee
- Growth Through Ethnic Coffee Introductions
- Improved Decaffeination Keep Aging Boomers Drinking Coffee
- Packaged Ready-to-Drink Coffees Continue to Attract New Users
- Shelf-Stable Drinks Present Distribution Growth Opportunities
- Co-Branding Opportunities
- Going After Specific Consumers
- Nutritional Niche
- Freshly Brewed Drinks Boom with More Iced Offerings
- And of Course, More Locations Equates to Increased Sales
- Working with Chefs to Offer Signature Brews
- Two Items of Concern
- Is Caffeine the Next Nicotine
Projected Market Growth
- Sales to Approach $21 Billion by 2008
- Table 3-9: Projected Total U.S. Sales of Coffee and Ready-to-Drink Coffee, 2003-2008
- Foodservice Picks Up as Economy Improves
- Table 3-10: Projected Total U.S. Sales of Coffee and Ready-to-Drink Coffee by Market, 2003-2008
- Ready-to-Drink Growth Keeps Retail Coffee Sales Out of the Red
- Table 3-11: Projected U.S. Retail Sales of Coffee and Ready-to-Drink Coffee by Product, 2003-2008
- Ready-to-Drink Sales Reach $589.8 Million
- Table 3-12: Projected Total U.S. Sales of Packaged Ready-to-Drink Coffee Beverages by Market, 2003-2008
Chapter 4: Market Dynamics
- Complex International Structure
- Marketers Are the Focus of This Study
- Size and Scope of Marketers
- Table 4-1: U.S. Retail Coffee and Ready-to-Drink Coffee; Select Marketers of Packaged Coffee Products by Brand and Product Type, 2003
Retail Marketers of Packaged Coffee
- Competitive Situation
- Starbucks Continues to Change the Supermarket Coffee Aisle
- A Very Full Supermarket Aisle
- Impulse Markets
- Distribution Agreements
- How Dairies Get Involved
- Refrigerated Business is Rather Regional
- Private Label Marketers
Competitive Retail Overview
- Retail Leaders of Coffee Packaged for Future Brewing or Mixing
- Table 4-2: U.S. Retail Sales of Coffee Packaged for Future Brewing or Mixing Top Five Marketer Sales and Share, 2003
- Figure 4-1: U.S. Retail Sales of Coffee Packaged for Future Brewing or Mixing Top Marketer Share, 2003
- Table 4-3: U.S. Retail Sales of Coffee Packaged for Future Brewing or Mixing Top 10 Brands(1) Sales and Share, 2003
- Figure 4-2: U.S. Retail Sales of Coffee Packaged for Future Brewing or Mixing Top Brands Share, 2003
- Regular Ground Coffee Takes Up Most of the Shelf
- Table 4-4: U.S. Retail Sales of Ground Coffee Top Three Marketer Sales and Share, 2003
- Figure 4-3: U.S. Retail Sales of Ground Coffee Top Three Marketers by Share, 2003
- Table 4-5: U.S. Retail Sales of Ground Coffee, Top 10 Brands Sales and Share, 2003
- Ground Decaf Is Small Business
- Table 4-6: U.S. Retail Sales of Ground Decaffeinated Coffee Top Three Marketer Sales and Share, 2003
- Table 4-7: U.S. Retail Sales of Ground Decaffeinated Coffee Top Five Brands Sales and Share, 2003
- Canned Coffee Makeover
- Instant Coffee Not Very Popular in the United States
- Table 4-8: U.S. Retail Sales of Instant Coffee, Including Specialty Instant Coffee Mixes Top Three Marketer Sales and Share, 2003
- Table 4-9: U.S. Retail Sales of Instant Coffee, Including Specialty Instant Coffee Mixes Top Five Brands Sales and Share, 2003
- Table 4-10: U.S. Retail Sales of Instant Decaffeinated Coffee, Including Specialty Instant Coffee Mixes Top Three Marketer Sales and Share, 2003
- Table 4-11: U.S. Retail Sales of Instant Decaffeinated Coffee, Including Specialty Instant Coffee Mixes Top Five Brands Sales and Share, 2003
- Kraft Gets Competition
- Table 4-12: U.S. Retail Sales of Specialty Instant Coffee Mixes, Top Four Marketers by Brand and Sales, 2003
- Whole Bean Is Where the Action Is
- Table 4-13: U.S. Retail Sales of Whole Bean Coffee—Regular and Decaffeinated, Top Three Marketer Sales and Share, 2003
- Table 4-14: U.S. Retail Sales of Whole Bean Coffee—Regular and Decaffeinated Top Five Brands Sales and Share, 2003
- Figure 4-4: U.S. Retail Sales of Whole Bean Coffee—Regular and Decaffeinated Top Five Brands by Share, 2003
- Specialty Coffee Market Estimated at $649.5 million
- Table 4-15: U.S. Retail Sales of Specialty Coffee, Top 15 Brands(1) Sales and Share, 2003
- No Need to Brew or Stop at a Café
- Table 4-16: U.S. Retail Sales of Ready-to-Drink Packaged Coffee Beverages, Top Three Marketer Sales and Share, 2003
- Table 4-17: U.S. Retail Sales of Ready-to-Drink Packaged Coffee Beverages, Top Five Brands Sales and Share, 2003
- Figure 4-5: U.S. Retail Sales of Ready-to-Drink Packaged Coffee Beverages, Top Five Brands Sales and Share, 2003
Foodservice Marketers of Freshly Brewed Coffee
- Diverse Group of Marketers
- Coffee Houses on Every Corner
- For Many, Sales Still Strong Despite Economy
- Learning From Starbucks
- Competitive Coffee House Overview
- Growth Opportunity with Niche Products
- Focusing on Niche Channels
- On Being a Micro-Roaster and Retailer
- Texas Is Not For Community
- Number-One Coffee House Is Starbucks
- Doughnut Giant Is Forefather of Specialty Coffee
- Table 4-18: U.S. Coffee Houses, Top Five Café and Donut Chains, Number of Units Worldwide, 2003
- Other Chains Growing Stronger
- Small Independent Marketers Get Assistance
- Fast Food Giant Adds Coffee Bars
- Operation Buzz Gets Buzzed
- C-Store and Gas Station Coffee Programs Become Class Acts
- Machines That Brew a Cup at a Time
- Office Coffee-Service Programs Present Growth Opportunity
- New Foodservice Brewer Helps Solve Operational Issues
- Upscale Restaurants Offer Signature Brews
- Flying Away With Satisfying Java
- Hotel Coffee Programs Are No Longer an Amenity
Competitive Overview of Niche Segments
- Variety of Niche Marketing Programs
- Sustainable Coffee Can Be Organic, Shade Grown, or Fair Trade
- Ethnic Coffee Marketers
Competitive Profiles: Boyd Coffee Co., Portland, Oregon
- Company Overview
- Innovators and Leaders, Here and Abroad
- Business Abroad
Competitive Profiles: Caribou Coffee Co. Inc., Minneapolis, MN
- Company Overview
- Atmosphere Differentiates Caribou From Starbucks
- Caribou Taps Coca-Cola
Competitive Profile: Dairy Farmers of America, Kansas, Missouri
- Company Overview
- Manufacturing Product for Top Brands
- North American Coffee Partnership
- Venturing for Growth
Competitive Profile: Dean Foods Co., Dallas, Texas
- Company Overview
- Suiza Foods’ Aggressive Start
- Virtual Coffee House
- Dean Foods Enters the Coffee-Milk and Soy Beverage Business
- A First with Aseptic Technology
- White Wave Serves Starbucks Soymilk
- Major Restructuring Occurs in 2003
- Plans to Acquire Horizon Organic
Competitive Profile: Diedrich Coffee, Inc., Irvine, California
- Company Overview
- Overseas Franchises Impact Revenue
- Stores Get Remodeled in Efforts to Improve Sales
- New Venture with Keurig
- Diedrich Coffee Suspends Franchising
Competitive Profile: Dunkin’ Donuts, Randolph, Massachusetts
- Company Overview
- Vice President Urges Industry to Emphasize Quality
- First with Fair Trade Espresso
- Synergies in Quick Service
- Building Beyond Its Own Walls
- Restructuring at ADQSR
- No Longer Your Average Cup of Joe
Competitive Profile: The Great Atlantic & Pacific Tea Co., Inc., Montvale, New Jersey
- Company Overview
- The Eight O’Clock Coffee Business
- A&P Exits the Coffee Business
Competitive Profile: Green Mountain Coffee, Inc., Waterbury, VT
- Company Overview
- Business Is Mostly Wholesale, But Retail Is Growing
- Brewing One Cup at a Time
- Well Poised for Growth
- Environmentally and Socially Responsible
- Expanding Fair Trade Offerings
- Committed to Roots, But Expansion Possible
Competitive Profile: Java City, Sacramento, California
- Company Overview
- Reaching New Heights
- Ecologically Sustainable Conservation Coffee Program
Competitive Profile: Kraft Foods, Inc., Northfield, Illinois
- Company Overview
- Coffee, Almost as Important as Cheese
- Starbucks Agreement
- Going Premium With Its Own Retail Brand
- Gevalia Expands Beyond Mail Order
- Other New Coffee Products
- Kraft’s Overall Plans For Future Growth
- When It Comes to Coffee, Kraft Says Increase Demand
- Kraft Partners with Rainforest Alliance
Competitive Profile: Nestlé USA, Inc., Glendale, California
- Company Overview
- Nestlé Drops Whole Bean and Ground Coffee Efforts
Competitive Profile: Peet’s Coffee & Tea, Inc., Emeryville, California
- Company Overview
- Diversifying Revenue Channels
- Growth Through Ventures and Promotions
- Part of the Community
Competitive Profile: The Procter & Gamble Co., Cincinnati, Ohio
- Company Overview
- Folgers Enters New Product Categories
- Millstone, P&G’s True Specialty Coffee Brand
- P&G Discreetly Manages Brother’s Coffee
- Oldest American Coffee Brand Provides Assistance
- Kicking the Can
- Rumor Has It
- New Foodservice Brewer
- Millstone Launches Signature Collection
Competitive Profile: Sara Lee Corp., Chicago, Illinois
- Company Overview
- Coffee Brand History
- Supporting the Chock Brand
Competitive Profile: Starbucks Corp., Seattle, Washington
- Company Overview
- Table 4-19: Starbucks Corp., Number of Units Domestic and Worldwide, 2003
- Coffee Houses Are Everywhere
- Starbucks in Retail Channels
- Profitable Partnerships
- Starbucks Buys Seattle Coffee
- Overseas Expansion Has Its Ups and Downs
- Entering the French Marketplace
- Technology Driven Marketing Efforts
Competitive Profile: Tully’s Coffee Corp., Seattle, Washington
- Company Overview
- Business Abroad
- New President to Turn Profits?
- The Big Chill
- Other Ventures
- Mixing Cyberspace with Coffee
Advertising and Promotion
- Market Leaders Are Big Spenders
- Starbucks Promotes Products After Debut of Folgers Jakada
- MTV Is Dunkin’ Donuts Route to Youth
- Sara Lee Targets the Big Apple
- C-Stores Promote Coffee
- Promotions Run Strong
- Coffee House Gift Cards
- Trade Advertisement Is Strong for Coffee
Chapter 5: Distribution and Sales Channels
- Retail Distribution Overview
- Retail Distribution Methods
- ESL Technology Provides Dairies with a Warehouse Opportunity
- Direct Delivery Advantages
- The Cost of Face-To-Face Business
- Advantages of Warehouse Delivery
- Distribution Agreements
- Smaller Marketers Work Through Brokers
Retail Sales Overview
- Traditional Supermarkets Account for 68.6% of Retail Sales
- Table 5-1: U.S. Retail Coffee and Ready-to-Drink Coffee, Share of Retail Sales of Packaged Coffee by Outlet, 2003
- Figure 5-1: U.S. Retail Coffee and Ready-to-Drink Coffee Share of Retail Sales of Coffee Packaged for Future Brewing or Mixing by Outlet, 2003
- Figure 5-2: U.S. Retail Coffee and Ready-to-Drink Coffee Share of Retail Sales of Ready-to-Drink Packaged Coffee Beverages by Outlet, 2003
- Packaged Coffee Placement in the Retail Environment
- Secondary Merchandising Creates Incremental Growth
- Decaffeinated Coffee Priced the Same When Bagged
- Table 5-2: U.S. Retail Coffee and Ready-to-Drink Coffee Share Retail Price of Selected Coffees Packaged for Future Brewing or Mixing, 2003
- Table 5-3: U.S. Retail Coffee and Ready-to-Drink Coffee
- Share Retail Price of Selected Ready-to-Drink Packaged Coffee Beverages, 2003
- Private Label Pricing
- Table 5-4: U.S. Retail Coffee and Ready-to-Drink Coffee Private Label vs. Branded, Comparative Retail Price of Ground Coffee, 2003
- Table 5-5: U.S. Retail Coffee and Ready-to-Drink Coffee Private Label vs. Branded, Comparative Retail Price of Ground Coffee on an Ounce Basis, 2003
- Table 5-6: U.S. Retail Coffee and Ready-to-Drink Coffee Private Label vs. Branded Comparative Retail Price of Ground Decaffeinated Coffee on an Ounce Basis
- Table 5-7: U.S. Retail Coffee and Ready-to-Drink Coffee Private Label vs. Branded Comparative Retail Price of Instant Coffee on an Ounce Basis, 2003
- Table 5-8: U.S. Retail Coffee and Ready-to-Drink Coffee Private Label vs. Branded Comparative Retail Price of Instant Decaffeinated Coffee on an Ounce Basis, 2003
- Table 5-9: U.S. Retail Coffee and Ready-to-Drink Coffee Private Label vs. Branded Comparative Retail Price of Whole Bean Coffee on an Ounce Basis, 2003
- Table 5-10: U.S. Retail Coffee and Ready-to-Drink Coffee Private Label vs. Branded Comparative Retail Price of Ready-to-Drink Packaged Coffee Beverages on an Ounce Basis, 2003
Alternative Retail Sales Channels
- Specialty Retail Channels
- Never Seeing the Inside of a Store
- Vending Improves Availability
- Dairies Evaluate Vending Machines
- Vending Machine Options
- Warehouse Clubs
- Coffee Is Big Business at Club Stores
- Table 5-11: U.S. Retail Coffee and Ready-to-Drink Coffee Club Store vs. Retail Prices, 2003
Coffee House Distribution Overview
- Coffee House Distribution Methods
- Explosion of Locations
- Coffee Cafés a Victim of Success
- Constraints on Opening Cafés
- Prices Vary by Chain and Location
Chapter 6: The Consumer
- Today’s Consumer
- Hooked on Quality
- Brand Loyalty Strong for Starbucks
- Seattle Consumers Veto Espresso Tax
Consumption Trends
- NCA Says Coffee Remains the National Drink
- Daily Consumption Is Slightly Down
- Where Coffee Purchases Are Made; When It’s Consumed
- Decaf and Instant Consumption Steady
- Specialty Coffee Most Attractive to Consumers
Targeting Consumer Segments
- Coffee’s Success Story
- Specialty Drinks for Young Consumers
- C-store Shoppers
- Restaurant Trends
Consumer Use and Demographics
- Simmons Consumer Survey Simmons Consumer Survey
- Simmons Data on Packaged Coffee for Future Brewing or Mixing
- Table 6-1: Percent of Consumers Who Use Packaged Coffee for Future Brewing or Mixing by Product Type, Brand, and Region, 2003
- With the Basics, Who Uses What?
- Table 6-2: Demographic Characteristics Favoring Purchase of Ground Coffee vs. Whole Bean Coffee, 2003 (U.S. Adults)
- Decaf vs. Regular, Also Influenced by Age
- Table 6-3: Demographic Characteristics Favoring Purchase of Regular vs. Decaffeinated Coffee, 2003 (U.S. Adults)
- With Special Drinks, Older Consumers Want Less Sugar
- Table 6-4: Demographic Characteristics Favoring Purchase of Espresso/Cappuccino Packaged, 2003 (U.S. Adults)
- Age, Region, and Income Influence Coffee Brand
- Table 6-5: Demographic Characteristics Favoring Purchase of Instant Coffee, 2003
- Table 6-6: Demographic Characteristics Favoring Purchase of Instant Specialty Coffee Mixes, 2003
Chapter 7: Trends and New Products
- Trends in Both Retail and Foodservice
- Consumers Want Quality Packaged Coffee
- Social Beliefs Drive New Product Introductions
- Flavors and Convenience Are Important New Product Attributes
- Coffee Concentrates
- Packaged Ready-to-Drink Coffees Gain Momentum
- Retail Packaging
- Ethnic Coffee Marketers
- Decaffeination Technologies Improve Product for Boomers
- Just a Bit Extraordinaire
- All About the Package
Strictly Foodservice
- Iced Beverages Are Actually Hot
- Opportunities with High-Tech Coffee Machines
- Mixing Cyberspace with Coffee
- Location, Location, Location
- For Many Chain, More Offerings Are All It Takes
- Upscale Restaurants Offer Signature Brews
- Table 7-1: U.S. Retail Coffee and Ready-to-Drink Coffee Select New Products by Marketer, Brand, and Description, 2003
- Table 7-2: U.S. Foodservice Coffee and Ready-to-Drink Coffee Select New Products by Marketer, Brand, and Description, 2003
Appendix: Addresses of Selected Marketers
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