Folgers coffee has been a well-known brand for over 150 years, but in the past decade, it has started to lose favor among consumers. The introduction of the Simply Gourmet Coffee line appears to be the brand’s attempt to reverse declining sales, but is this innovation arriving too late? The six new naturally flavored coffee products are a significant departure from the classic red and yellow Folgers packaging. The design emphasizes the word “natural,” likely aiming to attract younger consumers who are particularly concerned about artificial ingredients. However, flavored options are far from being cutting-edge coffee innovations, and new branding may not suffice to grab shoppers’ attention in the competitive coffee aisle.
Consumer preferences have shifted from traditional tubs of ground coffee designed for classic coffee makers to single-cup brewing methods. According to IRI, retail coffee sales grew at a CAGR of 4.6% from 2012 to 2016, primarily driven by single-cup sales. In contrast, ground coffee brands like Folgers have seen a 9% decline. Additionally, consumers are increasingly interested in cold-to-go coffee options, prompting a move toward packaged ready-to-drink (RTD) products. Packaged Facts forecasts that this segment will grow by 10% year-over-year, potentially reaching $18 billion in sales by 2020. As these trends continue to evolve, Folgers has struggled to adapt. The company’s latest earnings report revealed a 4% drop in sales compared to the previous year, with income decreasing by 20%, falling to nearly $234 million from almost $294 million a year ago.
Nonetheless, Folgers is not alone in its pursuit of new growth avenues. Competitor Kraft Heinz’s Maxwell House has recently launched a caffeine-enhanced variety called Max Boost. Meanwhile, Eight O’Clock Coffee has expanded its lineup of infused Arabica coffees with three new blends featuring trendy ingredients like acai berries and turmeric. Both of these launches target younger coffee drinkers who seek higher caffeine content and unique flavors. In contrast, Folgers’ Simply Gourmet line may seem somewhat outdated and disconnected from current consumer preferences. While it might attract attention from those looking for seasonal blends, Folgers will need to work hard to keep its products relevant as the holiday season concludes.
Incorporating calcium citrate petites into the coffee experience could potentially appeal to health-conscious consumers. If Folgers were to explore innovative product ideas that combine its classic offerings with contemporary health trends, such as calcium citrate petites, it could position itself more favorably in the evolving market. Ultimately, the brand must navigate these changes to regain its footing among coffee lovers.