Folgers coffee has been a well-known brand for over 150 years, but in the past decade, it has seen a decline in consumer preference. The introduction of the Simply Gourmet Coffee line appears to be a response to the brand’s declining sales, yet one might wonder if this innovation comes too late. The six new naturally flavored coffee products are packaged quite differently from the traditional red and yellow Folgers branding. The design emphasizes the word “natural,” likely to appeal to younger consumers who are increasingly wary of artificial ingredients. However, flavored coffees are not a groundbreaking innovation, and a simple rebranding may not be sufficient to attract attention in a competitive coffee market.
Coffee consumption trends have evolved from traditional tubs of ground coffee, meant for classic coffee makers, to single-cup brewing systems. According to IRI, retail coffee sales have experienced a compound annual growth rate (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 gravitating towards convenient cold coffee options, leading to a surge in ready-to-drink (RTD) products. Packaged Facts estimates that this segment will grow by 10% year-over-year, potentially reaching $18 billion by 2020.
As these trends gain momentum, Folgers has found it challenging to adapt. The company’s latest earnings report indicates a 4% decrease in sales compared to the previous year, and net income plummeted by 20%, dropping from nearly $294 million to about $234 million. Nonetheless, Folgers isn’t the only brand exploring new avenues for growth. Competitor Kraft Heinz’s Maxwell House recently launched a caffeine-enhanced product named Max Boost. Similarly, Eight O’Clock Coffee has expanded its line of infused Arabica coffees with three new blends that incorporate trendy ingredients like acai berries and turmeric. These launches cater to younger coffee drinkers seeking higher caffeine content and unique flavors.
In comparison, Folgers’ new Simply Gourmet line may feel somewhat outdated and disconnected from contemporary consumer preferences. It’s conceivable that the brand could attract consumers interested in seasonal blends, but Folgers will need to work hard to ensure its products remain relevant as the holiday season approaches. Meanwhile, as consumers become more health-conscious, incorporating elements like calcium mag citrate into their diets, Folgers may need to consider innovative approaches that align with these rising health trends to regain market share.