Abstract
The coffeehouse and donut shop market is seeing strong growth, bolstered by a shifting trend to premium coffee, expanding beverage and food menus, and young customers who embrace the coffeehouse culture as a part of their aspirational lifestyle. This growth has not been without cost, as chains bursting at the belt loose their identities as they try to meet everyone' s needs. In the midst of the catfight for the food and beverage dollar, competition has grown fierce within the market and from external sources such as quick-service and fast-casual restaurants.
Coffeehouses include freestanding stores, kiosks, and coffee carts, as well as those located in malls, office buildings, and hospitals, if operated independently of the facilities that house them. Coffeehouses may sell other items in addition to coffee, such as sweets, tea, travel mugs, and coffee beans, but the main product is coffee and coffee-based beverages. Donut shops are similarly housed units where donuts, other baked goods, and coffee feature prominently on the menu.
The report excludes other types of outlets that sell coffee, such as restaurants, bagel shops, truck stops, convenience stores, gas stations and diners (although some of these competitive outlets are considered when addressing competition issues).
Table of Contents
- Scope and ThemesWhat you need to know
- Definition
- Resources used for Consumer sections
- Abbreviations and terms
- Abbreviations
- Terms
- Executive Summary
- The bottom line
- Setting the stage
- Positive factors to growth
- Coffee use on the upswing
- Drive-through service meets commuting and convenience needs
- Increasing retail distribution presence
- Positive trends among 18-34s
- Quick service and convenience of location a huge draw
- Social factor provides opportunity
- Challenges and opportunities
- Chasing Starbucks
- QSR competition
- Striking the food and beverage balance
- The plight of the independent
- Cross-selling the high-frequency visitor
- Market Drivers
- Trend toward premium coffee consumption continues
- Figure 1: U.S. retail sales of coffee through FDM* and systemwide sales
of coffeehouses, 2001-06
- Figure 2: Consumption of specialty coffee among adults, 2000-06
- Figure 3: Reasons for drinking more coffee, July 2007
- Traditional restaurant segment lines are blurring as competition heats up
- QSRs
- Figure 4: Places coffee was drunk or bought in the last month, August
2007
- Fast casual
- Convenience stores
- Figure 5: Number of convenience stores, 2001-06
- Beyond breakfast: expanding menus means more competition for later-day
snacks and meals
- Drive-throughs cater to on-the-go lifestyles
- Figure 6: Commutes times in the U.S., 1990 and 2000
- Expanded distribution of products garners more brand attention
- Usage among 18-34s on the rise
- Figure 7: How coffeehouses are used, by age, August 2007
- Market Size and Trends
- Figure 8: U.S. retail sales at coffeehouses and donut shops, at current
and constant prices, 2004-06
- Trends
- Socializing a strong component of coffeehouse experience
- Figure 9: How coffeehouses are used and reasons for visiting, pertaining
to extended stays, August 2007
- Wi-Fi access
- Better-for-you (BFY) offerings
- Revolving/seasonal drink specials
- Reloadable cards
- Coffee with a conscience
- Market Segmentation
- Overview
- Figure 10: U.S. retail sales at coffeehouses and donut shops, 2004 and
2006
- Coffeehouses
- Figure 11: U.S. retail sales at coffeehouses and donut shops, at current
and constant prices, 2004-06
- Donut shops
- Figure 12: U.S. retail sales at coffeehouses and donut shops, at current
and constant prices, 2004-06
- Retail Distribution
- Company/brand sales
- Figure 13: U.S. sales of coffeehouses and donut shops, 2004 and 2006
- Figure 14: Retail foodservice sales estimates of specialty coffee in the
U.S., 2004 and 2006
- Figure 15: U.S. retail coffeehouse units, 2004 and 2006
- Figure 16: U.S. retail donut shop units at top three chains, 2004 and
2006
- Mergers and acquisitions
- Competitive analysis
- Starbucks
- Figure 17: Menu composition for Starbucks, by menu component, Q2 2007
- Brand analysis
- Caribou Coffee
- Figure 18: Menu composition for Caribou Coffee, by menu component, Q2
2007
- Peet' s Coffee & Tea
- Coffee Beanery
- Figure 19: Menu composition for Coffee Beanery, by menu component, Q2
2007
- Dunkin' Donuts
- Figure 20: Menu composition for Dunkin' Donuts, by menu component, Q2
2007
- Krispy Kreme
- Brand analysis
- Tim Hortons
- Figure 21: Menu composition for Tim Hortons, by menu component, Q2 2007
- Small chains and independents
- Figure 22: Coffeehouses and donut shops visited in the past month, and
frequency of visitation in the past month, August 2007
- Advertising and Promotion
- Introduction
- Starbucks
- Dunkin' Donuts
- Figure 23: Dunkin' Donuts advertisement
- Figure 24: Dunkin' Donuts advertisement
- Figure 25: Dunkin' Donuts advertisement
- Caribou Coffee
- Other
- The Consumer: Who Drinks Coffee and Where; Coffeehouse & Donut Shop
Purchases
- Summary
- Who drinks coffee and where
- Coffeehouse & donut shop food and drink purchases
- Branded chains vs. independents
- Usage of coffee
- Figure 26: Personal use of coffee, by key demographics, July 2007
- Where coffee is bought and drunk
- Figure 27: Locations where respondents have had coffee in past month, by
gender, August 2007
- Figure 28: Locations where respondents have had coffee in past month, by
age, August 2007
- Figure 29: Locations where respondents have had coffee in past month, by
household income, August 2007
- Figure 30: Locations where respondents have had coffee in past month, by
race/ethnicity, August 2007
- Figure 31: Locations where respondents have had coffee in past month, by
region, August 2007
- Types of food and drink purchased at coffeehouses and donut shops
- Figure 32: Types of food and drink purchased at coffeehouses and donut
shops, August 2007
- Coffeehouse food and drink
- Figure 33: Types of food and drink purchased at coffeehouses, by gender,
August 2007
- Figure 34: Types of food and drink purchased at coffeehouses, by age,
2007
- Donut shops
- Figure 35: Types of food and drink purchased at donut shops, by gender,
August 2007
- Figure 36: Types of food and drink purchased at donut shops, by age,
August 2007
- Figure 37: Types of food and drink purchased at donut shops, by
race/ethnicity, August 2007
- Branded chains vs. independents
- Figure 38: Coffeehouses and donut shops visited in the past month, and
frequency of visitation in the past month, August 2007
- Figure 39: Coffeehouses and donut shops visited in past month, by
household income, August 2007
- Figure 40: Coffeehouses and donut shops visited in the past month, by
geographic region, August 2007
- Attitudes Towards Coffeehouses & Donut Shops
- Summary
- How coffeehouses are used
- Factors influencing coffeehouse visit
- Attitudes toward coffeehouses
- Attitudes toward donut shops
- Starbucks customers versus independent store customers
- Attitudes toward coffeehouses by frequency of coffee use
- How coffeehouses are used
- Figure 41: How coffeehouses are used, by age, August 2007
- Figure 42: How coffeehouses are used, by race/ethnicity, August 2007
- Figure 43: How coffeehouses are used, by marital status, August 2007
- How coffeehouses are used in relation to the workday
- Figure 44: How coffeehouses are used in relation to the workday, by
presence of children, August 2007
- Figure 45: How coffeehouses are used in relation to the workday, by
region, August 2007
- Factors influencing coffeehouse visit
- Figure 46: Reasons for visiting a coffeehouse, by gender, August 2007
- Figure 47: Reasons for visiting a coffeehouse, by age, August 2007
- Attitudes toward coffeehouses
- Figure 48: Attitudes toward coffeehouses, by gender, August 2007
- Figure 49: Attitudes toward coffeehouses, by age, August 2007
- Figure 50: Attitudes toward coffeehouses, by race/ethnicity, August 2007
- Figure 51: Attitudes toward coffeehouses, by region, August 2007
- Attitudes toward donut shops
- Figure 52: Attitudes toward donut shops, by age, August 2007
- Figure 53: Attitudes toward donut shops, by region, August 2007
- Starbucks customers versus independent store customers
- Figure 54: Types of food and drink purchased at coffeehouses--Starbucks
versus independents, August 2007
- Figure 55: How coffeehouses are used--Starbucks versus independents,
August 2007
- Figure 56: Reasons for visiting a coffeehouse--Starbucks versus
independents, August 2007
- Figure 57: Attitudes toward coffeehouses--Starbucks versus independents,
August 2007
- Figure 58: How coffeehouses are used in relation to the workday, August
2007
- Attitudes toward coffeehouses by frequency of coffee use
- Figure 59: How coffeehouses are used, by frequency of coffee use, August
2007
- Figure 60: Reasons for visiting a coffeehouse, by frequency of coffee
use, August 2007
- Figure 61: Attitudes toward coffeehouses, by frequency of coffee use,
August 2007
- Future and Forecast
- Future trends
- QSR encroachment
- Independent and small chain coffeehouse share to erode
- Expanding menus draw in patrons
- Keeping younger consumers engaged as they age
- Figure 62: Select coffee and beverage use and where purchased, by age,
July 2007
- Market forecast
- Coffeehouses and donut shops
- Figure 63: Forecast of U.S. retail sales at coffeehouses and donut
shops, at current and constant prices, 2007-10
- Figure 64: Forecast U.S. retail sales at coffeehouses and donut shops,
at current and constant prices, 2007-10
- Coffeehouses
- Figure 65: Forecast of U.S. retail sales at coffeehouses, at current and
constant prices, 2007-10
- Donut shops
- Figure 66: Forecast of U.S. retail sales at donut shops, at current and
constant prices, 2007-10
- Forecast factors
- Appendix: Trade Associations
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