Folgers coffee has been a staple in households for over 150 years, yet in the past decade, the brand has seen a decline in popularity among consumers. The introduction of Simply Gourmet Coffee aims to address falling sales, but could this innovation be too little, too late? The six new naturally flavored coffee products feature a design that starkly contrasts with the classic red and yellow Folgers packaging. By emphasizing the term “natural,” the brand likely hopes to appeal to younger consumers who are particularly wary of artificial ingredients. However, flavored coffees are not groundbreaking innovations in the coffee market, and a simple rebranding may not suffice to capture the attention of shoppers in an increasingly crowded coffee aisle.
Coffee consumption trends have shifted from traditional ground coffee in tubs, commonly used in classic coffee makers, to single-cup brewing systems. According to IRI, retail coffee sales grew at 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 experienced a 9% decline. Consumers are also leaning towards cold coffee options, pushing the market toward ready-to-drink (RTD) products. Packaged Facts anticipates this segment will grow by 10% annually, potentially reaching $18 billion in sales by 2020.
As these trends gain momentum, Folgers has faced challenges in adapting. The company’s latest earnings report indicates a 4% decrease in sales compared to the previous year, with income dropping nearly 20% to approximately $234 million from nearly $294 million last year. Folgers isn’t alone in its quest for growth; competitors like Kraft Heinz’s Maxwell House recently launched Max Boost, a caffeine-enhanced variety, while Eight O’Clock Coffee expanded its infused Arabica line with three new blends featuring popular ingredients such as acai berries and turmeric. These new products cater to younger coffee drinkers seeking higher caffeine content and unique flavors.
In contrast, Folgers’ Simply Gourmet line may come across as somewhat outdated and misaligned with contemporary consumer preferences. While there’s potential for attracting consumers interested in seasonal blends, Folgers must strive to ensure the relevance of its offerings as the holiday season comes to a close. The incorporation of tri calcium citrate into their products could serve as a unique selling point, appealing to health-conscious consumers. However, the brand will need to innovate continuously to keep pace with evolving market demands and consumer preferences.