The Rise of E-commerce in the Coffee Industry: Trends, Statistics, and Future Outlook (2023)
With the rise of e-commerce in recent years, the coffee industry has seen considerable changes. Global e-commerce revenues increased by more than 269% between 2014 and 2021.
By 2026, the worldwide e-commerce business will be valued almost US $5.2 trillion, predicts Statista.
Coffee sales per person in the US are anticipated to increase from 2012 to 2025 at a CAGR of 4.8%.
 |
| Statista.com |
These numbers have most certainly gone up as a result of the Covid-19 epidemic as well.
This article will examine the rise of e-commerce in the coffee industry, including trends, statistics, and future outlook.
Overview
E-commerce has played a big influence in the coffee industry’s growth, making it one of the industries with the fastest recent increase.
Customers who may not have had access to a broad variety of coffee items before can now do so thanks to online stores.
With the Covid-19 epidemic, e-commerce has increased even more in the coffee market as customers
hunt for methods to get coffee online without having to leave their homes.
What is E-commerce in the Coffee Industry?
Buying and selling products and services online is referred to as e-commerce.
E-commerce in the coffee industry includes online sales of all coffee-related goods, such as beans, grinds, capsules, equipment, and accessories.
With its accessibility and ease, e-commerce has risen in popularity over the past few years.
Coffee goods can be ordered online and delivered right to consumers’ doorsteps, allowing them to buy from the comfort of their own homes.
The Rise of E-commerce in the Coffee Industry
E-commerce has reportedly been one of the coffee industry’s fastest-growing industries.
In fact, coffee has a 38.6% CAGR (Compound Annual Growth Rate) and is one of the top items sold online.
The predicted CAGR for the whole US coffee market is 4.8%, demonstrating the industry’s amazing online development.
With a $1.08 billion yearly market size in the US and a CAGR of +36.9%, Amazon has been a key participant in the online coffee sector. 86% of the coffee sold on Amazon is in capsules.
 |
| Statista.com |
The Impact of Covid-19 on E-commerce in the Coffee Industry
Coffee e-commerce sales have been significantly impacted by the Covid-19 epidemic, which has led to a rise in internet purchases.
Some Americans claimed the epidemic had impacted their buying patterns, according to Pew Research Center research.
Consumers started buying their coffee online as a result of social isolation and stay-at-home orders.
25% of coffee drinkers purchased a new variety of coffee during the epidemic, while 41% tasted a new one.
Since the epidemic, drive-through and mobile coffee orders have increased by 30%. E-commerce in the coffee industry is now clearly a requirement rather than a luxury.
E-commerce Dominates and Small Retailers Suffer
As a result of the rise of eCommerce, fewer people are buying goods from smaller businesses.
 |
| Wolfstreet.com |
Brick-and-mortar establishments, merchants, and wholesalers have suffered the most during the epidemic, according to a Berkeley Business Review article.
Businesses must adjust to the new routine as the scenario swiftly changes.
Despite what could appear to be a dismal scenario, there are still prospects for businesses to prosper in the coffee industry.
Common Online Coffee Retailers
Starbucks, Peet’s Coffee, and Dunkin’ Donuts, as well as smaller, more specialized merchants like Blue Bottle Coffee, Stumptown Coffee Roasters, and Counter Culture Coffee, are just a few examples of the various online retailers that specialize in coffee.
Several of these businesses provide a large selection of blends and roasts in addition to brewing supplies and accessories.
The Dominance of Amazon in Coffee Online Sales
Since April 2020, e-commerce has increased consistently, signaling a change in behavior that could last for some time.
According to Tea and Coffee, Amazon has a $1.08 billion yearly market share in the US and will maintain its
dominance in online coffee sales with a +36.9% CAGR. 86% of the coffee sold on Amazon is in capsules.
Smaller stores are still welcome, though, so this is not a definitive statement. In fact, smaller retailers may use eCommerce to expand their consumer base and take on the industry’s biggest players.
Smaller companies can find a place in the market by providing exceptional customer service, distinctive and high-quality products, and focused marketing.
How to Start an Online Coffee Business?
- Research the market: To find your target market and understand the competitors, conduct market research.
- Choose a business model: Choose the sort of online coffee business you wish to start, such as a roasting firm, a subscription service, or an online retail store.
- Establish a business plan: Organize your objectives, strategy, and financial estimates in a thorough company plan.
- Build a website: Construct a reputable website that displays your goods and services.
- Source high-quality coffee: Locate trustworthy vendors that can deliver high-quality coffee beans.
- Establish a marketing strategy: Come up with a marketing plan that will help you connect with your target market and increase brand
awareness.
Key Success Factors for Online Coffee Retailers
Retailers must concentrate on a few essential success characteristics in order to compete in the highly competitive world of online coffee sales. A few of these include:
- High-quality products: Consumers anticipate that the coffee they buy online will be at least as good as that found in a physical store.
- Pricing that is competitive: In order to draw customers and continue to be successful, online merchants need to be able to provide a price that is competitive.
- Efficient shipping and delivery: Orders should be transported and delivered fast and effectively, as this is what customers want.
- Excellent customer service: Good customer service is vital to online businesses that want to win their consumers’ trust and foster lasting relationships.
Challenges of Starting an Online Coffee Business
There are difficulties involved with starting a coffee business online. The following are some of the most common challenges:
- Building brand awareness: Creating a distinct identity in a competitive market and increasing
brand image can be difficult. - Shipping and logistics: Particularly when dealing with perishable goods like coffee, shipping, and logistics may be challenging.
- Inventory control: Keeping track of stock levels carefully and predicting demand for the future can be difficult when managing inventory.
Online Coffee Sales: Consumer Behavior and Preferences
Customers who buy coffee online are frequently well-educated and passionate about specialty coffee.
Also, they are probably younger and more technologically aware than the overall populace.
 |
| Pewresearch.org |
Though preferences might vary greatly, many consumers give top priority to elements like sustainability, fair trade principles, and organic certification when making purchases.
How Coffee Businesses Can Boost Online Visibility?
Businesses must utilize all of their resources to compete in the hypercompetitive coffee market.
Search engine optimization is one such tool (SEO). Businesses can boost their visibility in search engine results pages (SERPs) and drive more traffic to their websites by optimizing them for search engines.
As high-quality content is the foundation of SEO, companies must concentrate on producing it in order to draw in and keep consumers.
Sustainability in Ecommerce Coffee Sales
Both online and offline coffee shops are paying more and more attention to sustainability.
For coffee that has been sourced responsibly, many customers are ready to pay more, and online merchants are taking note.
Several online coffee shops have adopted environmentally friendly methods including direct trade and carbon-neutral delivery.
The Future of E-commerce in the Coffee Industry
E-commerce is where the coffee industry will be in the future since more people are preferring to buy their coffee items online.
The Covid-19 epidemic accelerated the tendency, which has since changed the course of the business.
As highlighted in Business Review Berkeley, the rise of e-commerce has nonetheless also resulted in the decrease of brick and mortar businesses, merchants, and wholesalers.
The environment is quickly shifting, and the coffee industry must adapt with it.
