Millennials are making headlines in the food and beverage industry. Consumers in this age group — between 18 to 34 — are known for wanting convenience, fresh and healthy options, customization and personalization, gourmet and specialty items. When it comes to a coffee experience, it’s no exception. In fact, Millennials’ taste preferences for a high-quality cup o’ joe are contributing to a changing coffee market.
Not only are Millennials affecting the food and beverage industry, but they are also entering the workforce in droves. In fact, they now surpass Generation Xers as the largest generation in the U.S. labor force, according to the Pew Research Center, which reported that more than one in three American workers today are Millennials.
Millennial preference for specialty coffee extends to the workplace and in order to succeed in the OCS industry, operators must react to and meet this demand.
Growth of gourmet
In its 2016 National Coffee Drinking Trends report, the National Coffee Association (NCA) found that daily consumption of espresso-based beverages has nearly tripled since 2008, and Millennials are driving this category shift.
Between 2008 and 2016, consumption of gourmet coffee beverages soared from 13 percent to 36 percent among 18 to 24 year olds and from 19 percent to 41 percent for those 25 to 39. And just for espresso-based beverages alone, the jumps become 9 percent to 22 percent for the 18 to 24 group and 8 percent to 29 percent for those 25 to 39. What does this mean? Millennials are choosing gourmet, espresso-based beverages…and at a rapid rate.
Speaking to this change, Bill Murray, NCA president and CEO remarked, “Consumption trends and generational patterns seem to be syncing up in promising ways. As younger consumers enter the category in larger numbers, their tastes are supporting broader trends in consumer behavior.”
So how can operators offer a gourmet experience to this dominant workforce group without missing a beat? Here are three ways that can help drive an OCS operator in the right direction:
#1 Coffee brands are key:
In order to cater to this generation and their specialty coffee needs, OCS operators should look to offering coffee brands that evoke a premium coffee experience. This means focusing on quality coffee beans. Gourmet or ‘specialty’ coffee beverages consist of espresso-based beverages and regular coffee made with gourmet coffee beans. The NCA survey of more than 3,000 people found that older Millennials between the ages of 25 to 39 are the most likely group to drink gourmet coffee beverages weekly, along with specific options including cappuccino, latte, café mocha, espresso, macchiato, flat white and cold-brew coffee.
#2 Choose the right machine for the location:
Part of the premium coffee experience includes not just the type of bean, but the way it’s offered as well. Single-cup brewers, including bean-to-cup machines, allow consumers to customize their hot beverage options in the workplace and allow for the convenience of brewing a single cup. In fact, in its 2015 State of the Coffee Service Industry report, Automatic Merchandiser found that single-cup and bean-to-cup machines were requested most often by new customers, even if the machine/brewer was not ultimately placed. It also found that access to premium roasts is also better met with single-cup and bean-to-cup machines. Not only do these machines allow Millennial users to customize their coffee experience, they also generally feature a sleek exterior and technology advancements such as touchscreens that Millennials use in their everyday lives.
#3 Think outside the cup:
Millennials prefer a coffee shop-like experience when they enjoy their cup o’ joe, as mentioned by an earlier article published by Automatic Merchandiser that discussed using coffee shops for inspiration to provide a great coffee service while keeping good margins. The coffee shop experience, while including offering premium beans and high tech brewing methods, can also consist of other features such as a loyalty program or a means of social media sharing. The key to capitalizing on Millennial preference for “specialty” in terms of a coffee experience is to try multiple methods and see which one sticks, including flavor varieties, brewers, bean types, etc. Thinking outside of the cup, to the experience as a whole, can have a large impact in gaining the attention of the younger consumer.
As younger generations continue to enter the workforce, OCS operators will be tasked with offering the hot and cold coffee beverages these employees crave; if not, there is the risk losing business to someone else who does. Capitalize on this segment by offering gourmet and specialty roasts and brewing methods that meet this Millennial demand.
