Trying to do some market research in finding out how many people have espresso coffee machines. I know that:
- Fresh ground coffee saw a strong 8% rise in current value unit price in 2010 over the previous year, as a result of higher global raw material prices. There were poor harvests in Colombia and Brazil for arabica coffee beans and, while UK suppliers strived to keep price increases to a minimum, many global suppliers heavily increased prices in order to compensate for rising input costs. Price increases were thus particularly strong within higher-quality arabica coffee. Unfavourable exchange rates also forced many UK players to increase costs, with coffee generally purchased in dollars.
- Overall, coffee saw 2% growth in current value unit price in 2010 over the previous year, following on from 3% growth in 2009. In 2009, unit price growth was primarily driven by instant coffee, as players encouraged consumers to trade up. In 2010, however, instant coffee was characterised by stronger price competition, with players increasingly using price promotions to drive sales. Price promotions were led by Nescafé and Kraft’s Kenco and focused particularly strongly on freeze-dried instant coffee, with a growing focus on promotions offering a third off the standard price. Players thus sought to appeal to price-sensitive consumers during the economic downturn. Instant coffee thus saw just 1% current value unit price growth in 2010, with price increases instead being driven by fresh ground coffee.
- 2010 saw stronger off-trade volume and current value sales growth for overall coffee in comparison to the review period CAGR. Coffee benefited from the economic downturn, with a growing number of consumers seeking to save money by consuming more coffee at home, rather than visiting specialist coffee shops.