Roasted coffee sales in the Italian retail channel were worth €1.19 billion in 2017, down by 0.6% in value and by 4.3% in volume compared to the previous year, according to a study by IRI.
However, coffee capsules have bucked this trend, growing by 16.8% in value to €282.2 million, and by 20% in volume, with prices over four times higher than the category average.
The growth of the capsule segment has progressively changed the roasted coffee category, with most of the players redefining their offers to sustain market performance. Private label brands have also expanded their ranges to include capsules, reaching a share of 12.9% in value terms (+1.5%).
As a result of falling demand for ground coffee, promotions have become the main ‘line of defence’ for the roasted coffee segment, representing 45.7% of total coffee sales, while only 14.7% of capsules are sold under promotional conditions.
Last year, about one million kilograms of capsules were sold in Italy's retail channel, reaching 25% of the total value of the coffee market, and 6% in volume terms.
However, the overall segment shows a slight decline in average price, due to the entry and growth of smaller producers and private label brands.
In the retail channel, supermarkets saw the highest level of coffee sales, with €728.5 million (+0.1%), followed by hypermarkets with €199.7 million (-0.2%), independent small retailers with €160.6 million (-4.7%), and discounters with €100.5 million (+0.9%).
In terms of the capsule market specifically, 35.4% of sales were for Lavazza's A Modo Mio system, followed by Dolce Gusto (26%), Nespresso (24.3%), and other systems (14.2%).
However, Nespresso-compatible products showed higher growth rates (+42.7%), compared to Dolce Gusto (+18.2%) and A Modo Mio (+4.2%).
Overall, roasted coffee accounted for 2.3% of total food and beverage sales in Italian grocery retail in 2017.
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Branislav Pekic. Click subscribe to sign up to ESM: The European Supermarket Magazine