In a recent report on the UK coffee market Mintel said sales of decaf coffee fell 8 per cent in 2009 and now account for 11 per cent (£62 million) of annual instant sales. Mintel analyst Ben Perkins told BeverageDaily.com that decaf sales were also down in the US last year.
When regular coffee sales are growing, what explains these woes in the decaf category? An obvious problem is a perception that decaf does not taste as good as regular coffee.
Identity crisis
Perkins said this is a big issue for the category. But there are other problems that almost amount to an identity crisis.
Only 23 per cent of coffee drinkers agreed that decaf coffee is better for them – a figure Perkins said indicates that decaf is failing to get its health message across.
Perkins also pointed out that unlike green tea, decaf coffee gets its health value from what it is missing rather than what it contains. This presents an obvious barrier to development for decaf because a lot of coffee fans drink coffee for the wake-up effect and are therefore unlikely to ever be interested in decaf.
Coffee makers are now looking for new ways to target health conscious consumers. One avenue is low fat and low calorie coffee. These have some value potential in countries like the UK and the US where big, milky cups of coffee are preferred.
Mintel said such health claims grew in number last year on the back of some negative publicity that revealed high levels if fat in coffee shop products like Macchiatos and Frappuccinos.
There may be potential for more low fat/ low calorie coffees in some markets but there is also significant promise outside the “free-from” area. Regular coffee is starting to find its own positive messages and is finding a niche for itself on the functional drink space.
Functional coffee
In September last year, Nestle launched Nescafe Green Blend Coffee in the UK – a product made with green coffee beans which contain high levels of polyphenol antioxidants.
Perkins said the presence of Nescafe in the functional space is obviously significant although for the moment the market is small.
Mintel believes that the green tea phenomenon and recent research flagging up coffee as a rich source of polyphenols could provide the spurs for coffee to take its place in the functional landscape.
In its recent coffee report, Mintel said: “The Green Tea trend has played a major part in transforming the way that consumers view hot beverages, and has perhaps opened a door in the coffee market for a functional positioning.
“As such it would appear that health and appearance benefits will be key developments for the future, particularly in light of the more favourable research that has recently come to light about the effects of drinking coffee.”