Low-cost freshly ground coffee is all over the street, is there still a market for instant coffee?

With the continuous growth of the domestic coffee market, instant coffee, fine freshly ground coffee and ready-to-drink coffee have developed by leaps and bounds.

Compared with the other two categories, drinking coffee is obviously more "low-key", accounting for only 10% of the total market share of coffee consumption. However, on the basis of the increasing consumer demand for coffee, the instant coffee market is also moving towards a hot trend, and the whole market also shows great potential for development.

Data show that instant coffee first entered the domestic market in 1998. Suntory and other foreign brands quickly entered coffee shops, supermarkets and other retail terminals, opening up the canned and bottled coffee market. With the rapid development of the domestic coffee market, many brands have flocked to the ready-to-drink coffee track.

At present, Nestl é, Starbucks, COSTA, Wa, Unification, Yili, Tims, Nongfu Springs, Coca-Cola and so on have joined in. In the current ready-to-drink coffee market, Nestl é still firmly occupies the first place with the first-mover advantage, while Starbucks occupies the second place.

According to incomplete statistics, China's instant coffee market accounted for 10.1% of the total consumption in 2018, while instant coffee and freshly ground coffee accounted for 71.8% and 18.1%, respectively. Instant coffee does not seem to be the mainstream in the coffee market, but with the diversification of consumption and product differentiation, the market share of ready-to-drink coffee is gradually expanding.

Driven by both the consumer side and the industry side, the instant coffee category continues to grow rapidly. According to the head Leopard Research Institute, China's ready-to-drink coffee market doubled in size with a compound growth rate of 19.3% to 9.64 billion from 2017 to 2021, and it is expected that there is still considerable room for growth in the next few years. It is worth mentioning that the growth rate of the instant coffee market is much faster than that of soft drinks and bottled water as a whole.

For consumers, when choosing ready-to-drink coffee, the taste is stable, there is no need to brew, that is, buy and drink, efficient and refreshing characteristics have become a priority factor, to a large extent to meet the needs of the current fast-paced population. At the same time, consumers also pursue high performance-to-price ratio. Some ready-made coffee lovers began to try to buy ready-to-drink coffee, while satisfying caffeine, cheap quantity is one of the preferred factors.

With the increasing demand for high-quality coffee, the high-quality and high-end development trend of drinking coffee begins to appear. According to the 2020 ready-to-drink Coffee Innovation Trends report, 45% of consumers in the ready-to-drink market want to use high-quality milk sources, while 44% want to choose high-quality coffee beans. To some extent, this also reflects that the high-end development of ready-to-drink coffee will become a trend in the future.

However, if the ready-to-drink coffee goes to the high-quality route, the price increase is inevitable. For example, the original products of about 5 yuan, after claiming that the raw materials and processes have been upgraded, the price has risen to 10: 16 yuan. For example, the price of Starbucks Frappuccino coffee 281 ml is about 16 yuan, which is comparable to that of a cup of freshly ground coffee. How many people are willing to buy it? Therefore, the formulation of a suitable price strategy is of great significance to the development of ready-to-drink coffee market.

Ready-to-drink coffee has become a fast-growing beverage category, mainly due to the entry of giants. Although the competition between brands has intensified, but also continue to promote ready-to-drink coffee to a new stage of competition, the future high-end, boutique, high-playability products are also more in line with the expectations of the public.