Maurizio Giuli discusses new trends in the coffee business. Global coffee consumption has grown at 2% annually over decades, driven by emerging markets where espresso introduced new consumers. Coffee shops chains expanded globally, facing challenges from high costs and competition. Looking ahead, the industry may see higher concentration, new entrants, and focus on short-term profits over quality. Consumers are more demanding of premium and sustainable products and experience-driven over products alone. Distribution is impacted by online shopping trends. Coffee shops remain innovation leaders attracting consumers with experiences.

1. Maurizio Giuli
(President Ucimac & Chief Corporate Marketing Simonelli Group)
New trends in the coffee business
February 2019

2. PORTFOLIO
Simonelli Group
<
<

3. Overview
2.
The Past:
What happened?
Maurizio Giuli: New trends in the Coffee Business February 2019
3.
The Future:
Which trends?
1.
The Present:
Where we are?

4. Overview
2.
The Past:
What happened?
Maurizio Giuli: New trends in the Coffee Business February 2019
3.
The Future:
Which trends?
1.
The Present:
Where we are?

5. Coffee Consumption 2018
Arabica
62%
Robusta
38%
165
Millions
Bags
(Source: Euromonitor Inter).)
Maurizio Giuli: New trends in the Coffee Business February 2019

6. US$ 180-200
billion
Total Global Spend
2018 (estimated)
US$ 83 billion
Retail Coffee Sales in
2017
US$ 58 billion
Specialist Coffee Shops
2017
US$ 11 per capita
Average expenditure in
retail coffee sales per
year
2.3 million
cups
Of coffee are consumed
every minute worldwide
Top 5 Markets
Account for 50% of
total volume sales
(Source: Euromonitor Intern.)
Maurizio Giuli: New trends in the Coffee Business February 2019

7. Sales of coffee worldwide by category
37,2 30,1 20,7 15,7 58
2,10%
2,30%
1,70%
5,90%
3,60%
0,00%
1,00%
2,00%
3,00%
4,00%
5,00%
6,00%
7,00%
0
10
20
30
40
50
60
70
Retail Roast &
Ground coffee
Retail Instant
Coffee
Ready-to-Drink
Coffee
Retail Coffee Pods Specialist Coffee
Shops
CAGR2017-2022
US$bn
(Source: Euromonitor Intern.)
Maurizio Giuli: New trends in the Coffee Business February 2019

8. (Source: Euromonitor Intern.)
9,6 Mn Tons
Wold Coffee Consumption on 2017
Maurizio Giuli: New trends in the Coffee Business February 2019

9. Top 5 Markets worldwide (in 2017)
951,000 Tons
1,100,000 Tons
416,000 Tons
212,000 Tons
710,000 Tons
(Source: Euromonitor Intern.)
Maurizio Giuli: New trends in the Coffee Business February 2019

10. Top Markets for Coffee Consumption
(Source: Euromonitor Intern.)
Maurizio Giuli: New trends in the Coffee Business February 2019

11. 0
100.000.000
200.000.000
300.000.000
400.000.000
500.000.000
600.000.000
700.000.000
800.000.000
900.000.000
1.000.000.000
1.100.000.000
1.200.000.000
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
World Trade Export Volume ( Ton)
-3,6%
Source: Comtrade
Maurizio Giuli: New trends in the Coffee Business February 2019

12. 1.
The Present:
Where we are?
Overview
2.
The Past:
What happened?
Maurizio Giuli: New trends in the Coffee Business February 2019
3.
The Future:
Which trends?

13. 57,9
107,1
1964 2018
165
CAGR
1,9%
Evolution World Coffee Consumption (Ton M.io)
(Source: ICO + Euromonitor)
Maurizio Giuli: New trends in the Coffee Business February 2019

14. (Source: LCM Intern.)
Global coffee consumption has
grown at by 2% per annum over the
last decades
Maurizio Giuli: New trends in the Coffee Business February 2019

15. How has evolved the coffee market
I°
Wave
II°
Wave
III°
Wave
IV°
Wave
1900 1970 1995 2005
The Coffee
Discovery
The Latte
Revolution &
Coffee Shop
The Artisanal
Coffee Shops
The Coffee
Everywhere
Retail FoodService FoodService FoodService + Retail
Marketing
(Packaging, Adv, …)
Atmosphere
Menù
Coffee Quality Innovation
Essence
Key Channel
Focus on
Maurizio Giuli: New trends in the Coffee Business February 2019

16. Evolution of coffee Consumption World Wide
(Source: ico)
Maurizio Giuli: New trends in the Coffee Business February 2019

17. In recent years more than
80% of consumption
growth has been driven
by Emerging and
Producers Countries
100
120
140
160
180
200
220
240
1990 1995 2000 2005 2010
Consumption index (1990 = 100)
mature producers emerging
Maurizio Giuli: New trends in the Coffee Business Caffè Diemme 2019
(Source: LCM Intern.)
Maurizio Giuli: New trends in the Coffee Business February 2019

18. 0
1.000
2.000
3.000
4.000
5.000
6.000
7.000
8.000
9.000
10.000
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
World Trade Export Value ( 000.000 US$)
(Source: Eurostat)
Maurizio Giuli: New trends in the Coffee Business February 2019

19. 0
1.000
2.000
3.000
4.000
5.000
6.000
7.000
8.000
9.000
10.000
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
World Trade Export Value ( 000.000 US$)
Why?
(Source: Eurostat)
Maurizio Giuli: New trends in the Coffee Business February 2019

20. The
economic
growth
Maurizio Giuli: New trends in the Coffee Business February 2019

21. Correlation Index:
GDP/Kg per capita
0,75
GDPPerCapita
Kg per Capita
Maurizio Giuli: New trends in the Coffee Business February 2019

22. Ibrick
Drip
Coffee
Boiled
Coffee
Filter
Coffee
Istant
Coffee
Dallah
Coffee
Flip Drip
Coffee
Vacuum
Coffee
Carlsbad
Coffee
Espresso
Coffee
Moka
Coffee
Cultural boundaries
Maurizio Giuli: New trends in the Coffee Business February 2019

23. The espresso coffee
with all its based drinks has
revolutionized the
coffee industry world-
wide
Maurizio Giuli: New trends in the Coffee Business February 2019

24. The impact of the espresso drinks in the coffee waves
I°
Wave
II°
Wave
III°
Wave
IV°
Wave
The Coffee
Discovery
The Latte
Revolution &
Coffee Shop
The Independents
Coffee Shops
The Coffee
Everywhere
ESPRESSO DRIVEN
Maurizio Giuli: New trends in the Coffee Business February 2019

25. Espresso Coffee
has reshaped the
consumption habits all
over the world
Maurizio Giuli: New trends in the Coffee Business February 2019

26. In Western
Economies
Espresso Coffee
has
relaunched
the demand
Maurizio Giuli: New trends in the Coffee Business February 2019

27. (Source: FAO 2001)
Coffee & Tea Consumption by Country (1996)
In 1996 coffee
consumption was
concentrated in the
Western economies
and in some Producers
Countries.
Tea Drinker nations
were prevalent
Maurizio Giuli: New trends in the Coffee Business February 2019

28. In Emerging
Economies
Espresso Coffee
has
introduced
consumers to
coffee consumption
Maurizio Giuli: New trends in the Coffee Business February 2019

29. The coffee shops chains have
played a big role in the new coffee
scene
Maurizio Giuli: New trends in the Coffee Business February 2019

30. (Source: Allegra)
Maurizio Giuli: New trends in the Coffee Business February 2019

31. + 6%
(Source: Allegra)
Maurizio Giuli: New trends in the Coffee Business February 2019

32. (Source: Allegra)
Maurizio Giuli: New trends in the Coffee Business February 2019

33. (Source: Allegra)
Maurizio Giuli: New trends in the Coffee Business February 2019

34. (Source: Allegra)
Maurizio Giuli: New trends in the Coffee Business February 2019

35. (Source: Allegra)
Maurizio Giuli: New trends in the Coffee Business February 2019

36. key success
factors
Good location
Quality of coffee
Atmosphere and ambience
Attractive coffee shop
design
Strong brand identity
Value for money
Standard of Service
Maurizio Giuli: New trends in the Coffee Business February 2019

37. (Source: Allegra)
Maurizio Giuli: New trends in the Coffee Business February 2019

38. High rents / property Costs
High staff turnover
Increasing competition
Shortage of suitable staff
Rising labour costs
Business rates / taxes
Low quality of coffee
Low quality of service
key
challenges
Maurizio Giuli: New trends in the Coffee Business February 2019

39. (Source: Allegra)
Maurizio Giuli: New trends in the Coffee Business February 2019

40. 1.
The Present:
Where we are?
Overview
2.
The Past:
What happened?
Maurizio Giuli: New trends in the Coffee Business February 2019
3.
The Future:
Which trends?

41. The game in the Coffee scene is changing
Maurizio Giuli: New trends in the Coffee Business February 2019

42. Maturity
The Coffee demand will continue to
grow
Coffee consumption reached almost
all nations
The speed of grow will have a slow
down
To extend its penetration and to
increase the occasion of consumption
are the Key challenges
Coffee will take part of the places of
soft drinks
1.
Maurizio Giuli: New trends in the Coffee Business February 2019

43. Industry
Higher concentration
New entrants (package food brand
companies)
Stronger selection
Lower distance between Specialty
and Commercial players
Focus on short term profitability
Potentially lower attention to
quality
2.
Maurizio Giuli: New trends in the Coffee Business February 2019

44. Consumer
More demanding (premiumisation)
Product itself is no more enough.
Consumers are attracted by the individual
experience more than the product itself
Homing
High attention to Health & Wellness
Sensitive about sustainability
Iperconnected
Individualist and Me-centric
3.
Maurizio Giuli: New trends in the Coffee Business February 2019

45. Distribution
Amazon’s effect
High Street shops are suffering
Eating is the new attraction for the
shopping mall
From Food-courts to Food-hall
4.
Maurizio Giuli: New trends in the Coffee Business February 2019

46. Coffee
Shop
Trend Setter
State of the
art in coffee
Innovation
Lab
Daily
experience
for consumer
Big
connection
opportunity
with
Consumer
Coffee Shop
5.
Maurizio Giuli: New trends in the Coffee Business February 2019

47. Consumer Side
Opportunities Threats
Premiumisation
Growth of Demand
More occasion for coffee
More demanding than ever
Health and wellness
Retail Side
Industry Side
Eating is the new shopping
FoodService is the Trendsetter
Product innovation is the driver for
growth
New Technologies
Homing
Mature Stage
More Closers than openings
Consolidation Process
New Entrants (like Package Food Brands)
Orientation to the short term profitability
Lower attention to Quality
Deforestation and wostering climate impact
Maurizio Giuli: New trends in the Coffee Business February 2019

48. A pessimist sees the
difficulty in every
opportunity; an optimist
sees the opportunity in
every difficulty
Maurizio Giuli: New trends in the Coffee Business February 2019

49. Thank you
Slideshare: GiuliMaurizio
Special thanks to:
- Simonelli Group
- Caffè Diemme
- Uff. Studi Anima
- Allegra
- Euromonitor Int.
- SCA
- ICO