Coffee as a segment has steadily gained share of total consumer spending on beverages over the last many years. Coffee serves as the first rung on the ladder for young consumers in India, while it reflect growing demand among consumers looking for convenient, decent-quality coffee at home and in the workplace.
Opportunities for coffee to gain more popularity among new consumers, as well as reclaim those exiting the category, lies in continued modernism, both in terms of developing new flavor’s and improving quality.
According to “India Coffee Market Outlook, 2021”, packaged coffee market is expected to grow at a CAGR of around 12% over next five years. Coffee market consists two categories, such as packaged coffee and coffee shops & cafe market. Instant coffee is creating a huge demand in packaged coffee segment.
The convenience, versatility of flavor and format, and branded experience provided by instant coffee enable it to be positioned as a premium hot drink option, particularly for new coffee drinkers in predominantly lower income tea drinking markets.
The easy preparation of instant coffee, as well as its aptitude to be tailored to local taste preferences has made it the “coffee of choice” in most markets in India.
Instant coffee has propelled brands such as Nestlé, HUL, Tata Coffee.
However filter coffee is also expanding its presence among Indian consumers. The market for filter coffee is predominantly southern India where the competition from local/regional player is significant.
