Folgers coffee has been a household name for over 150 years, but in the past decade, it has begun to lose consumer appeal. The brand’s new Simply Gourmet Coffee line appears to be a response to declining sales, but is this innovation arriving too late? The six new naturally flavored coffee products stand in stark contrast to the traditional 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 coffee varieties are not exactly groundbreaking, and revamped branding may not be sufficient to capture shopper attention in a saturated coffee market.
Coffee trends have shifted away from traditional tubs of ground coffee intended for classic coffee makers to single-cup brewing systems. According to IRI, retail coffee sales experienced a compound annual growth rate (CAGR) of 4.6% from 2012 to 2016, largely driven by single-cup sales. In contrast, ground coffee products like Folgers have seen a 9% decline. Additionally, consumers are increasingly interested in cold, ready-to-drink coffee options, prompting a market shift towards packaged products. Packaged Facts anticipates that this segment will grow by 10% year-over-year, potentially reaching $18 billion in sales by 2020.
As these trends continue to strengthen, Folgers has struggled to keep pace. According to the company’s latest earnings report, sales fell by 4% compared to the previous year, and income plummeted by 20%, dropping from nearly $294 million to around $234 million. However, Folgers is not the only brand seeking new avenues for growth. Competitor Kraft Heinz’s Maxwell House has recently introduced a caffeine-enhanced variety called Boost. Additionally, Eight O’Clock Coffee has expanded its line of infused Arabica coffees with three new blends featuring trendy ingredients like acai berries and turmeric. These launches are targeted at younger coffee drinkers who seek unique flavors and higher caffeine content.
In comparison, Folgers’ new Simply Gourmet line may seem somewhat outdated and disconnected from contemporary consumer preferences. While the brand might attract attention from those interested in seasonal blends, Folgers will need to work hard to ensure its products remain relevant as the holiday season comes to an end. This situation reflects a broader trend in consumer behavior, similar to the growing interest in dietary supplements like calcium citrate for osteoporosis, which underscores the demand for products that align with health-conscious choices. As Folgers navigates this evolving landscape, it must find ways to integrate modern consumer demands—like natural ingredients—into its offerings if it hopes to regain its competitive edge.