How can coffee brands stay relevant to Gen Z consumers?

Anay Mridul speaks to Rob Baines of Farrer’s and Daniel Webber of Chimney Fire Coffee to learn how coffee brands can tackle the most intimidating market of all: Gen Z.

The younger generation – known as Gen Z – has a curious relationship with coffee.

In the UK, more than half of them claim to never drink coffee at cafés, while 46% claim to never consume it at home or work. In the US, two-thirds (63%) say they don’t drink coffee at all. This is in contrast to millennials – the generation directly before them – of which only 39% claim to avoid cafés.

However, the Gen Zers who do consume coffee are found to be twice as likely to prefer “gourmet” coffee – non-instant arabica, in this instance – than those over 60.

This indicates that while they may not drink vast quantities of coffee, the quality of the coffee they do drink is important. And, with a disposable income of more than $360 billion globally, it’s important for the long-term success of coffee businesses to pay attention to their habits.

“Gen Z will become the most pivotal generation to the future of retail, and an understanding of their specific tendencies and expectations is key,” says Rob Baines, general manager of Farrer’s, the UK’s oldest coffee roasters.

“They don’t just spend on a brand just for the brand’s sake, and they certainly aren’t afraid to shop around for the best quality and price. Alongside that, they are impatient, resource-conscious, and experience-driven.”

It’s not just about speed and efficiency, either. Research shows that Gen Z-ers are willing to pay a premium for healthier food. All these factors combined could present a lucrative opportunity for coffee businesses around the world.

What do Gen Zers look for in coffee brands?

According to estimates, only 37% of Gen Zers are brand loyalists – those who buy products from the same company they were considering at the start of their shopping journey. For baby boomers, this rises to 56%.

“These consumers have defined values and, as a result, pay more attention to how brands align with them,” Rob says. “They want convenience underpinned by home delivery, they demand more transparency and traceability, and above all, they want experiences.”

Consequently, research suggests that taste, price, and convenience are at the top of Gen Z’s coffee-buying motivations.

“They are the first fully digitised generation, used to online and social media shopping platforms linked to direct-to-door two-day delivery,” Rob adds.

In that case, it’s clear that convenience plays a part – but so do quality and cost.

However, Daniel Webber, founder of Chimney Fire Coffee, feels that transparency, sustainability, and ethics are equally, if not more important, for this generation.

“As Gen Zers turn their backs on corporate culture, some of the traditional strategies of big businesses around providing consistency and convenience seem to be less important than quality and transparency,” he explains.

Supply chain transparency, he says, helps them feel a connection to farmers and producers many miles away. “It turns what’s historically been viewed as an anonymous commodity crop into an experience to be celebrated and savoured for its individuality,” he adds.

He also notes that there’s a greater emphasis than ever before on buying more eco-friendly products, minimising single-use plastics and opting for recyclable or compostable packaging.

“They are fully invested in wanting to understand every stage of its journey from seed to cup,” Rob agrees. “They specifically want to know where their coffee is grown, who grew it, and whether it was grown ethically and sustainably.”

Sustainability goes hand-in-hand with reduced emissions. The advent of energy-efficient, superautomatic coffee machines aligns well with the demands of Gen Z.

Some of these machines even incorporate touch screens with useful videos, further appealing to the digital nature of this generation. Others are fully capable of frothing plant-based milks, addressing Gen Z’s interest in healthier, more sustainable product options.

How are coffee brands already adapting to the Gen Z market?

Above all, it seems that Gen Zers are obsessed with convenience.

Part of that convenience is the availability of ready-to-drink coffee products. In 2018, these – along with cold brew – were Gen Z’s most frequently purchased drinks. Furthermore, in the UK, 64% of 18- to 24-year-olds believe iced coffee is a better alternative to sugary drinks.

“They are possibly even more pressed for time than previous generations, so it’s important for coffee companies to innovate and provide this convenience for them too,” explains Rob.

Rob and Daniel both ascribe this to health consciousness, which is more prevalent than ever. Daniel explains that this market has exploded recently as healthier alternatives become more widely available.

“Sugary soft drinks are demonised for their negative health effects, so there are opportunities across the sector to create satisfying cold/ready-mixed drinks,” he says.

“These drinks also help provide the aspects of consistency and convenience that big name coffee shops have historically relied on, meaning their money can be spent in a more ethical fashion.”

However, the market is already incredibly competitive, making it increasingly difficult for coffee brands to stand out.

“If a brand can offer a product that aligns with their very specific values and passions, then it’s on the right side of the curve,” Rob suggests, referencing the modern shifts his 200-year-old company is making.

Daniel adds that brand messaging is crucial in creating trust.

“Audiences want to be educated rather than just sold to, and unsubstantiated claims are seen through and quickly debunked,” he elaborates.

Aside from being a certified B Corp business – which backs up its sustainability claims – Chimney Fire Coffee addresses this need by providing as much information as possible about both where its coffee comes from and how packing materials are sourced.

Rob asserts that making tactical use of a variety of media – including social and online – is essential.

“User engagement and social presence are key to gaining traction in younger generations, with the primary means of reaching new markets being platforms such as Instagram and TikTok,” agrees Daniel.

In the end, it’s “pretty simple, really”, concludes Rob.

“Focus on authenticity, quality, price, provenance, sustainability, ease of access, and experience,” he says. “Get those things right and you’ll have a winning formula.”