Folgers coffee has been a well-known brand for over 150 years; however, in the past decade, it has started to lose its appeal among consumers. To address declining sales, the brand has launched a new line called Simply Gourmet Coffee, but some may wonder if this innovation is merely a case of “too little, too late.” The six new naturally flavored coffee offerings are presented in packaging that starkly contrasts with the traditional red and yellow Folgers design. The emphasis on the word “natural” aims to attract younger consumers, who tend to be particularly cautious about artificial ingredients. Yet, flavored coffee options are not groundbreaking innovations, and a fresh brand image might not be sufficient to draw attention in the saturated coffee market.
Coffee consumption trends have evolved from the classic tub of ground coffee designed for traditional coffee makers to the popularity of single-cup brewing systems. According to IRI, retail coffee sales saw a compound annual growth rate (CAGR) of 4.6% from 2012 to 2016, largely driven by single-cup sales. Meanwhile, ground coffee brands like Folgers have experienced a decline of 9%. Additionally, consumers are increasingly seeking cold grab-and-go coffee alternatives, prompting a market shift towards ready-to-drink (RTD) 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 gain momentum, Folgers has found it challenging to adapt. The company’s latest earnings report revealed a 4% decline in sales compared to the same period last year, with income plummeting by a fifth, from nearly $294 million to approximately $234 million. However, Folgers is not alone in its quest for growth. Competitor Kraft Heinz has introduced a caffeine-enhanced variety under its Maxwell House brand called Max Boost. Additionally, Eight O’Clock Coffee has expanded its range of infused Arabica coffees, launching three new blends that feature trendy ingredients like acai berries and turmeric. Both of these initiatives target younger coffee drinkers who desire higher caffeine content and unique flavors.
In contrast, Folgers’ new Simply Gourmet line may appear somewhat outdated and misaligned with current consumer preferences. While there may be interest from consumers seeking seasonal blends, Folgers will need to actively work on making these products relevant, especially as the holiday season comes to an end. Furthermore, incorporating health trends, such as those seen with Citracal 315 mg, could provide an additional angle for attracting health-conscious consumers. Ultimately, Folgers faces a significant challenge in revitalizing its brand and product offerings to meet the evolving demands of today’s coffee drinkers.