The global coffee market continues to brew up a storm, and Asia is playing a key role in its growth.
New research from Mintel reveals that three out of the five fastest growing retail coffee markets are in Asia. Indonesia is currently the fastest growing packaged retail coffee market with a CAGR of 19.6% over the past five years, while India has had a CAGR of 15.1%, and Vietnam 14.9%.
Overall, the global coffee market continues to grow steadily, with expected retail volume growth of 2.7% in 2016, following a 2.5% rise in 2015.
Innovation & the RTD Revolution
The boom in Asia’s coffee market has been driven by a surge in innovation of coffee products.
According to Mintel’s Global New Products Database (GNPD), between 2011 and 2016 the number of new coffee products launched in Asia has risen by 95%. In comparison, the number of tea products (coffee’s top competitor) has risen by a comparatively low 55% in the same time period.
In terms of local tastes, currently Asia Pacific leads the way in launches of ready-to-drink cold coffee. In 2016, 29% of all coffee launches in Asia Pacific were ready-to-drink cold coffee products, compared to just 10% in Europe. (Companies should expect to see more of this growing trend worldwide: the U.S. market for packaged and ready-to-drink coffee sold at retail was estimated at $13.5 billion in 2015, up almost 10% from the year before, according to recent research.)
However, instant coffee still dominates the retail market in Asia. 42% of coffee launches in Asia Pacific were soluble coffee granule products in 2016, compared to just 20% of launches in Europe, and only 6% of launches in North America.
Globally, coffee pods are causing the biggest stir. Pods accounted for over one quarter (26%) of all global coffee retail innovation in 2016, up from 11% of launches in 2011.
Related: Six Surprising Single-Cup Statistics
As consumers in emerging markets develop their taste for coffee and learn more about the beverage, quality will become increasingly important – contributing to a growing global third-wave coffee culture.
For more report highlights and to learn more about the research, read the full release from Mintel.
Compiled by Kyra Auffermann, NCA