The days of specialty coffee being a niche beverage with a small consumer base are long gone. In fact, the specialty coffee market is growing quickly. For example, the specialty coffee market is projected to grow at a compound annual growth rate of 12.9 percent for the next 7 years and reach a market size of $120.5 billion by 2030.
So, within a decade, the specialty coffee market will be significantly larger than where it was in 2022. This means that for the coffee industry, micro is quickly becoming the new macro.
Factors Contributing to the Growth of the Specialty Coffee Market
1. Specialty Coffee Demand is Resistant to Inflation
Inflation levels rose strongly following the height of the COVID-19 pandemic. In June of 2022, inflation was as high as 9 percent. When inflation rises, many people tend to curb their spending and be more conservative with their purchases.
However, according to the 2023 National Coffee Data Trends Specialty Coffee Report published by the National Coffee Association (NCA), specialty coffee demand has proven to remain strong even in high inflationary environments. In fact, in January 2023, over 4 in 10 Americans over 18 years old drank at least one cup of specialty coffee per day.
Some consumers have switched to buying specialty coffee in bulk to help cut costs. But, many are still simply going to their local specialty coffee shop to get their favorite brews on a consistent basis.
2. Changing Tastes of Consumers.
Just like with other industries, consumer preferences often change and develop over time. Currently, there is a major shift happening in the coffee industry. Many consumers are starting to develop a strong preference for premium coffee. As a result, specialty coffee and the shops that serve it are on the rise.
Part of the reason why consumer preferences are changing is because the younger generations such as millennials have taken a strong liking to specialty coffee. Millennials aging and reaching higher levels of spending power is fueling the growth of the specialty coffee market.
Specialty coffee has also proven to be extremely popular across all demographics.
Other Impressive Specialty Coffee Statistics
Thanks to the 2023 National Coffee Data Trends Specialty Coffee Report and other sources, many other impressive statistics about the specialty coffee market have been published. Here are some of the most important of these:
- 78% of coffee consumed by 18-24-year-olds in America on a typical day is specialty coffee. However, only 46 percent of coffee consumed by Americans aged 60 or over is specialty coffee.
- 77% of specialty coffee drinkers are preparing at least one cup of specialty coffee per day at home.
- Specialty coffee is extremely popular in Europe and in 2022, Europe controlled roughly 30.8% of the global specialty coffee market.
- The Asia-Pacific market is projected to grow the fastest out of any market with an expected compound annual growth rate of 13.6%.
These statistics reveal some incredibly interesting facts about how the specialty coffee industry is progressing and developing.
Echoing the Craft Beer Industry
The strong growth of the specialty coffee market is echoing the growth of the craft beer market. In fact, the craft beer industry is projected to grow at a compound annual growth rate of 10.8% and reach a global market size of $221.5 billion by 2028. This is a massive jump from the market size of $117.1 billion which the craft beer market had in 2022.
The astonishing growth of both the craft beer industry and the specialty coffee markets is a major indicator that many people are switching from drinking traditional beverages to specialized, more unique, and higher-quality beers and coffees.
High-quality ingredients, production methods, and artisanal expertise are proving to be enormously popular. Smaller specialty coffee shops and craft breweries are producing beverages with flavors that are extremely impressive and compelling and they are developing loyal fan bases that are growing every year.
What Is Next For Specialty Coffee?
Specialty coffee is seeing substantial growth and sustained popularity in many regions of the world. Many coffee drinkers absolutely love it and are continuously demonstrating their preferences for high-quality coffee. Due to the solid growth of the specialty coffee industry, it is likely that over the next decade, we will see a large amount of specialty coffee innovation in terms of farming methods, brewing styles, roasting methods, and more.
The growth of the industry in addition to other factors, such as the apparent resistance of specialty coffee demand to inflation and its popularity amongst the younger generations will likely result in a surge of investment in the industry.
More innovation and investment into the industry will be a welcome development for fans of specialty coffee. This is because these things will help them to get access to even more delicious flavors of quality roasted coffee and have more brewing styles to choose from.
Conclusion
Just like craft beer, specialty coffee started out as a niche item whose demand completely paled in comparison to traditional options. Also, craft beers and specialty coffees first started to be commonly offered in the 1970s. Additionally, due to their quality, both beverages gained momentum over the decades and are now transforming their respective industries. Both specialty coffee production and craft beer production have been rising for years.
The bottom line is that the specialty coffee movement is like a train rushing full speed ahead. It cannot be stopped and it is taking over. From espressos to cold brews to lattes, specialty coffee is being served and winning over customers in coffee shops all around the world. However, many people are also enjoying it at home. So, regardless of whether you prefer to go to your local specialty coffee shop or make your own tasty brew at home, specialty coffee is more available and better than ever before.