Anyone researching how to save money will have been met with the same advice at the top of every article: ‘1. Stop buying coffees when out and about – make them at home instead.’
Much like getting enough sleep and keeping active, part of what makes the advice so grating is that it works.
With minimum wage increasing, mandatory sick pay extending, material prices soaring and businesses fighting to retain profit margins, businesses are fighting to stay afloat.
As a result, it is no wonder that prices in cafes have gone up and customers are feeling the pinch.
Forgoing a coffee costing the better part of €5, even a few times a week, is an easy and instant way to reduce spending, but how are customers faring with cheaper alternatives?
Cheaper Options
In June, Centra Insights revealed that the retailer’s Irish iced-coffee sales had increased by an incredible 150%, compared to the previous year. Circle K also found that iced-coffee sales had risen by 78% within the network in 2023, compared to the year before.
Convenience retailers offer the drinks for less than they cost in a traditional cafe, with Circle K offering iced-coffee options from as little as €2.
When the offer was announced, the director of market development at Circle K, Gillian McGowran, said, “Customers can enjoy the convenience of grabbing the finest-quality coffee as they like it, with the added value of an iced coffee for only €2 or a hot coffee bundled with a free bottle of water at selected stores across our network, all for an unbeatable price.”
For some, however, even €2 for a drink is an area in which they need to reduce on their budget, which is where grocery retailers have a chance to come in and capitalise on the at-home coffee market.
Pret a Manger had been running a service that gave customers up to five free coffees a day when they paid a £30 monthly subscription, in an attempt to recoup Covid losses and entice customers back to the chain.
Last month, it announced that the subscription service, in its current form, is coming to an end, and it would automatically move subscribers to a discount model.
Under the new model, subscribers will pay £10 a month for up to five half-priced coffees a day.
Cost-weary customers were unhappy with the update, with one person on social media calling it a ‘massive, monumental’ error.
The change prompted customers to turn away from the membership model as it changes.
Be Your Own Barista
Coffee lovers may then be switching to the at-home coffee blend, investing in at-home tools, especially as a remote-working culture has developed in recent years.
While supermarkets stock both ground and full coffee beans, franchises such as Starbucks and Costa have developed make-at-home coffee products, now available in supermarkets.
Many cafes and Irish businesses have also begun selling their blends in store, for the cost-conscious customer.
These initiatives are clever, as they give consumers the taste and sense of caffeinating from their favourite spot without overspending.
They also present an opportunity for retailers to collaborate with popular coffee spots, ensuring a mutually beneficial business partnership providing for under-caffeinated customers.
The media has also noticed the trend, with journalist Glenn Kelly reviewing five at-home coffee machines for RTÉ, as customers look to make a one-time investment to save money in the long term.
Retailers also have the opportunity to gain ground in this market – Velo Coffee grew from the Grow with Aldi programme in 2019 to being stocked in supermarket chains around Ireland.
Making coffee at home also helps the sustainability problem, as it prevents the waste of single-use cups and lids.
As labels are losing market share to private label in the face of sticky inflation, private-label products are also a viable option for shoppers.
With a wide array of blends and grinds, retailers can reach a wide market to appeal to tastes and customers’ preferred brewing tool, be it a cafetière, an AeroPress, a filter, a Chemex, or a fancy machine.
It’s a diverse market that is wide open, and retailers are already waking up and smelling the coffee.
Read More: That’s That Me, Espresso – Ireland’s Top Instant/Ground Coffee Brands
