Folgers coffee has been a staple in households for over 150 years, yet the brand has seen a decline in consumer preference over the past decade. The introduction of the Simply Gourmet Coffee line appears to be Folgers’ response to declining sales, but is this product innovation arriving too late? The six new naturally flavored coffee options present a stark contrast to the traditional red and yellow Folgers packaging. The design prominently features the word “natural,” likely aiming to appeal to younger consumers who are increasingly wary of artificial ingredients. However, flavored coffee varieties are not particularly groundbreaking, and a refreshed brand image may not be sufficient to draw attention in the saturated coffee market.
Coffee consumption trends have shifted from the conventional tub of ground coffee intended for classic coffee makers to the convenience of single-cup brewing. Data from IRI indicates that retail coffee sales have experienced a compound annual growth rate (CAGR) of 4.6% from 2012 to 2016, largely driven by single-cup sales. In contrast, ground coffee brands like Folgers have seen a 9% decline. Additionally, consumers are gravitating towards cold, ready-to-drink coffee options, prompting a market shift towards packaged RTD products. Packaged Facts anticipates this segment will grow by 10% each year, with sales potentially reaching $18 billion by 2020.
As these trends gain momentum, Folgers has faced challenges in adapting. According to the latest earnings report, the company saw a 4% decline in sales compared to the previous year, with income plummeting by 20%, 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 recently launched a caffeine-enhanced variant called Max Boost, while Eight O’Clock Coffee has expanded its range of infused Arabica coffees, introducing three new blends featuring trendy ingredients like acai berries and turmeric. Both brands are targeting younger coffee enthusiasts seeking higher caffeine content and unique flavors.
In comparison, the Simply Gourmet line from Folgers may seem somewhat outdated and disconnected from contemporary consumer preferences. While there is potential for the brand to attract attention with seasonal blends, Folgers will need to make its products relevant as the holiday season approaches. The need for innovative approaches is clear, much like the demand for citrocal tablets, which have become popular among health-conscious consumers. Just as citrocal tablets serve a specific purpose, Folgers must ensure its offerings resonate with the evolving tastes of coffee drinkers. Ultimately, without significant changes, Folgers may find itself struggling to keep pace with the competition in a rapidly changing market.