Is out-of-home coffee consumption making a comeback?

Kahwei Yoong
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October 22, 2021
out of home coffee consumption

When the Covid-19 pandemic broke out in early 2020, coffee shops were among the first to close.

Seen by governments as breeding grounds for the spread of the virus, many were given strict orders to shut their doors for the foreseeable future. According to some estimates, up to 95% of all hospitality businesses were forced to close at some point during the last 18 months.

However, over time, coffee shops found ways of adapting to the new landscape to continue serving their customers. Some were able to ramp up their takeaway offerings, while others set up ecommerce sites and subscription models.

At the same time, consumer behaviour changed considerably, namely in the form of a shift towards home coffee consumption. For example, nearly a third of Americans said they had tried to replicate a favourite coffee shop beverage at home during the pandemic.

Now, as restrictions start to ease and coffee shops reopen, the question is whether these trends are here to stay or if out-of-home coffee consumption will return to pre-pandemic levels.

To find out more, I spoke with roaster champion and co-founder of MABÓ Coffee, Bogdan Georgescu.

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coffee shop closures
During the Covid-19 pandemic, up to 95% of hospitality venues closed at least once

How the pandemic affected coffee consumption

Before the pandemic, coffee shops served as a place from which millions of people around the world bought their daily cup of coffee. In 2019, coffee shops received more than 35 million visitors in the UK alone, with an average of 123 ml of hot beverages consumed per person per week.

When Covid-19 struck and the majority of coffee shops were forced to close their doors – some for months at a time – naturally the way people consumed coffee radically changed. And, as a result, so did the coffee shops themselves.

The most significant shift was towards home coffee consumption. In January 2021, a report by the NCA, a coffee market research body, showed that 84% of US consumers had prepared a coffee at home in the last 24 hours, compared to just 25% who had bought coffee out. Sales of personal coffee machines also increased.

This change in consumer habits was met with a corresponding rise in takeaway orders, online sales, and coffee subscriptions. Many roasters and coffee shops that had long relied on face-to-face transactions suddenly found their ecommerce sales surge and takeaway orders became one of their most important revenue streams.

For example, following the US government’s stay-at-home orders in March 2020, coffee chain Blue Bottle reported a 150% uptick in year-over-year ecommerce sales, while also adding between 300 and 400 subscribers per week.

woman drinking coffee out of home
As lockdown restrictions ease, people have started to return to coffee shops

Are consumers returning to coffee shops?

Although home coffee consumption undoubtedly soared during the pandemic, there are clear signs of the situation returning to normal.

Last month, the National Coffee Data Trends (NCDT) report showed Americans had increased coffee consumption at coffee shops by 20% since January 2021, with a 16% increase in out-of-home coffee consumption overall. Meanwhile, more than half of UK consumers claim to have visited a coffee shop since lockdown restrictions were lifted.

Bogdan Georgescu runs a coffee shop in Romania and says that he’s observed a similar trend.

“In Romania, we saw some decrease in out-of-home coffee consumption during our one-month lockdown,” he tells me. “But after that, consumption rebounded and has been consistently increasing, with more people coming to our café. There’s also been an increase in wholesale demand from other coffee shops.”

“I think there will be a ‘new normal’… And this ‘new normal’ will be completely different.”

While a complete return to pre-pandemic levels is still a way off for some, the recovering demand for coffee shops shouldn’t come as too much of a surprise.

During the height of the pandemic, more than 50% of consumers said they missed out-of-home coffee experiences and two in five who tried to replicate favourite coffee shop beverages admitted it “wasn’t the same”.

However, some of Covid-19’s effects on consumer behaviour continue to linger – and may do for the foreseeable future. According to Bogdan, one of the most significant is the sustained demand for coffee to-go.

He explains that although more people are coming to his coffee shop than during the pandemic, many are still opting to take away rather than sit in. He adds that consumers are also continuing to buy bags of coffee to brew at home – which has caused sales at his roastery to jump.

This suggests that people are returning to coffee shops with a different set of expectations and have embraced the habit of making coffee at home.

“I think there will be a ‘new normal’,” he tells me. “And this ‘new normal’ will be completely different. The situation will not go back to exactly how it was before the pandemic. We will have to see how it goes – only time will tell.”

out of home coffee consumption
Takeaway drinks will continue to play an important role in the aftermath of the pandemic

How to prepare for a post-pandemic coffee landscape

The spread of Covid-19 and its ensuing lockdowns had a dramatic and far-reaching impact on the coffee industry – much of which is still being felt today.

Therefore, to ensure a smooth transition into a post-pandemic environment, there are a few things that coffee roasters should consider.

Bogdan says that, in addition to a sustained number of takeaway orders, improved service management is a must. This is in anticipation of higher consumer expectations since lockdowns, which have made them generally less forgiving of poor customer service.

Indeed, nearly a third of consumers say they are more likely to leave a store or coffee shop if there are queues than they were before the pandemic.

Part of adhering to this change involves having a strong online presence. The pandemic proved that purchasing activities are no longer constrained to brick-and-mortar stores and the ability to provide an omni-channel experience will become increasingly important. As PwC’s latest report shows, consumers’ shift towards digital means is set to remain “sticky” post-Covid.

Roasters and coffee shops should also anticipate selling more bags of coffee at their physical locations. For this, it’s important to ensure you have enough stock, while also looking for ways to display them on shelves in an appealing way.

This presents an opportunity for roasters to not only consider the role of packaging in attracting attention, but also to educate consumers.

Bogdan has done this by including recipes on his coffee bags, because his consumers were finding it difficult to reproduce coffee shop quality.

Packaging features such as tasting cards that can be slotted into external pockets on the bag will come in handy for roasters to present additional information to consumers.

Roasters and coffee shops should be flexible and open to change

Ultimately, uncertainties still remain as we continue to navigate through the pandemic. Yet, one thing is certain: the world that we all know of has fundamentally changed. As a new era of coffee unfolds, roasters and coffee shops should be flexible and open to new opportunities, whether it means expanding takeaway options or going digital.

At MTPak Coffee, we offer a wide range of packaging options for specialty coffee roasters. Made from sustainable materials, our coffee bags are fully customisable from pouch type to design and additional features, such as tasting cards and degassing valves.

Our dedicated team can work closely with you to design the best packaging for both home and out-of-home consumption.

For information on our kraft paper coffee bags, contact our team.

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Is out-of-home coffee consumption making a comeback?

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