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Coffee Pods and Capsules Market

ID: MRFR/CG/5418-CR
100 Pages
Pradeep Nandi
September 2022

Coffee Pods and Capsules Market Research Report Information By Coffee Type (Traditional And Decaf), By Distributional Channel (Store Based And Non-Store Based), And By Region (North America, Europe, Asia-Pacific, And Rest Of The World) –Market Forecast Till 2030

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Coffee Pods and Capsules Market Summary

As per MRFR analysis, the Coffee Pods and Capsules Market Size was estimated at 16.04 USD Billion in 2024. The Coffee Pods and Capsules industry is projected to grow from 17.03 in 2025 to 31.11 by 2035, exhibiting a compound annual growth rate (CAGR) of 6.21 during the forecast period 2025 - 2035.

Key Market Trends & Highlights

The Coffee Pods and Capsules Market is experiencing a dynamic shift towards sustainability and personalization.

  • North America remains the largest market for coffee pods and capsules, driven by a strong consumer preference for convenience.
  • The Asia-Pacific region is emerging as the fastest-growing market, reflecting a rising trend in coffee consumption among younger demographics.
  • Traditional coffee pods dominate the market, while decaf options are witnessing rapid growth due to increasing health consciousness.
  • Key market drivers include the demand for convenience and time efficiency, alongside a growing emphasis on sustainability and eco-friendly practices.

Market Size & Forecast

2024 Market Size 16.04 (USD Billion)
2035 Market Size 31.11 (USD Billion)
CAGR (2025 - 2035) 6.21%

Major Players

Nestle (CH), Keurig Dr Pepper (US), JDE Peet's (NL), Lavazza (IT), Starbucks (US), Peet's Coffee (US), Café Royal (CH), Illy (IT), Tassimo (DE)

Coffee Pods and Capsules Market Trends

The Coffee Pods and Capsules Market is currently experiencing a dynamic evolution, driven by changing consumer preferences and advancements in technology. As individuals increasingly seek convenience and quality in their coffee experiences, the demand for single-serve coffee solutions continues to rise. This market segment appears to be characterized by a growing emphasis on sustainability, with many brands exploring eco-friendly materials and practices. Additionally, the proliferation of various flavors and blends indicates a shift towards personalization, allowing consumers to tailor their coffee choices to their unique tastes. Moreover, the competitive landscape of the Coffee Pods and Capsules Market is becoming more intricate, as established players and new entrants alike strive to capture market share. Innovations in brewing technology and packaging are likely to enhance the overall consumer experience, making it more appealing. The trend towards premiumization suggests that consumers are willing to invest in higher-quality products, which may further influence market dynamics. Overall, the Coffee Pods and Capsules Market is poised for continued growth, reflecting broader trends in consumer behavior and environmental consciousness.

Sustainability Initiatives

The Coffee Pods and Capsules Market is witnessing a notable shift towards sustainability. Brands are increasingly adopting eco-friendly materials and practices to appeal to environmentally conscious consumers. This trend encompasses the development of biodegradable and recyclable pods, as well as initiatives aimed at reducing waste throughout the supply chain.

Personalization of Offerings

There is a growing trend towards personalization within the Coffee Pods and Capsules Market. Consumers are seeking unique flavors and blends that cater to their individual preferences. This demand for tailored coffee experiences is prompting brands to expand their product lines, offering a diverse range of options to satisfy varying tastes.

Technological Advancements

Technological innovations are playing a crucial role in shaping the Coffee Pods and Capsules Market. Enhanced brewing technologies and smart coffee machines are emerging, providing consumers with improved convenience and quality. These advancements are likely to redefine the coffee experience, making it more accessible and enjoyable for users.

Coffee Pods and Capsules Market Drivers

Convenience and Time Efficiency

The Coffee Pods and Capsules Market is experiencing a surge in demand due to the increasing preference for convenience and time efficiency among consumers. Busy lifestyles and the need for quick solutions have led to a significant rise in the consumption of coffee pods and capsules. According to recent data, the market is projected to grow at a compound annual growth rate of approximately 7% over the next few years. This trend indicates that consumers are gravitating towards products that offer ease of use without compromising on quality. The ability to brew a fresh cup of coffee in a matter of seconds appeals to a wide demographic, including professionals and students. As such, the Coffee Pods and Capsules Market is likely to continue expanding as more individuals seek out convenient coffee solutions.

Rising Coffee Consumption Trends

The Coffee Pods and Capsules Market is witnessing a notable increase in coffee consumption trends across various demographics. Factors such as changing lifestyles, the rise of remote work, and a growing appreciation for specialty coffee are contributing to this trend. Recent statistics reveal that coffee consumption has increased significantly, with many consumers opting for coffee pods and capsules as their preferred method of preparation. This shift is particularly evident among younger consumers who favor the convenience and variety offered by these products. As coffee culture continues to thrive, the Coffee Pods and Capsules Market is likely to see sustained growth, driven by the evolving preferences of a diverse consumer base.

Technological Innovations in Brewing

Technological advancements are playing a crucial role in shaping the Coffee Pods and Capsules Market. Innovations in brewing technology have led to the development of machines that enhance the overall coffee experience. Features such as precision brewing, temperature control, and smart connectivity are becoming increasingly common. These advancements not only improve the quality of the coffee but also offer consumers greater control over their brewing process. Market analysis indicates that the integration of technology in coffee machines is attracting tech-savvy consumers who value both convenience and quality. As these innovations continue to evolve, the Coffee Pods and Capsules Market is expected to benefit from increased consumer interest and engagement.

Diverse Flavor Profiles and Customization

The Coffee Pods and Capsules Market is increasingly characterized by a diverse array of flavor profiles and customization options. Consumers are no longer satisfied with standard coffee offerings; they seek unique and varied experiences. This shift has prompted manufacturers to innovate and introduce a plethora of flavors, ranging from traditional blends to exotic infusions. Market data suggests that the demand for specialty coffee pods has risen significantly, with a notable increase in sales of flavored and gourmet options. This trend indicates a growing consumer interest in personalized coffee experiences, which is likely to drive further growth in the Coffee Pods and Capsules Market. As brands continue to cater to these preferences, the market may witness an expansion in product lines that emphasize quality and variety.

Sustainability and Eco-Friendly Practices

Sustainability has emerged as a pivotal driver in the Coffee Pods and Capsules Market. With increasing awareness of environmental issues, consumers are actively seeking products that align with their values. Many companies are responding by adopting eco-friendly practices, such as using biodegradable materials for coffee pods and capsules. Recent studies indicate that a significant portion of consumers is willing to pay a premium for sustainable products, which suggests a shift in purchasing behavior. This trend not only enhances brand loyalty but also positions companies favorably in a competitive market. As sustainability becomes a core focus, the Coffee Pods and Capsules Market is likely to evolve, with more brands prioritizing environmentally responsible practices in their product offerings.

Market Segment Insights

By Coffee Type: Traditional (Largest) vs. Decaf (Fastest-Growing)

The Coffee Pods and Capsules Market displays notable segmentation into Traditional and Decaf varieties of coffee. Traditional coffee pods and capsules have established themselves as the dominant force in this market, capturing a substantial share driven by long-standing consumer preferences for rich and robust flavors that are characteristic of conventional coffee. This segment benefits from familiarity and brand loyalty amongst coffee drinkers who favor traditional blends over alternatives. In contrast, Decaf coffee is gaining traction as a fast-growing segment within the market. As consumers become more health-conscious and seek to reduce caffeine intake without sacrificing flavor, the demand for decaffeinated options is increasing. This shift in consumer preference has prompted manufacturers to innovate and improve the flavor profiles of decaf coffee, making it a competitive option within the market.

Traditional (Dominant) vs. Decaf (Emerging)

Traditional coffee pods and capsules continue to dominate the Coffee Pods and Capsules Market, catering to coffee purists who prioritize the classic coffee experience. This segment often boasts a diverse range of blends and flavors, appealing to various taste preferences and encouraging brand loyalty. In recent years, many brands have enhanced their offerings with sustainable and ethically sourced coffee, further solidifying their appeal in an increasingly conscious market. On the other hand, Decaf coffee is emerging as a significant player, driven by a growing consumer base that values lower caffeine consumption. Decaf options are now more widely available and are being improved in terms of taste and quality, making them an attractive alternative for those who wish to enjoy coffee at any time of the day.

By Distribution Channel: Store-Based (Largest) vs. Non-Store-Based (Fastest-Growing)

In the Coffee Pods and Capsules Market, Store-Based distribution channels dominate, accounting for a substantial portion of the overall market share. This includes retail outlets such as supermarkets, specialty coffee shops, and convenience stores, which provide consumers with direct access to a variety of brands and flavors. The physical presence of these stores enhances customer experience, allowing them to engage with products before purchasing, hence attracting a loyal customer base.

Store-Based (Dominant) vs. Non-Store-Based (Emerging)

Store-Based distribution channels hold a dominant position in the Coffee Pods and Capsules Market due to their accessibility and the tangible product experience they offer. Retail environments not only feature a broad spectrum of products but also provide promotional activities that engage customers directly. In contrast, Non-Store-Based channels, encompassing e-commerce and home delivery services, are emerging rapidly as consumer preferences shift towards convenience and digital shopping experiences. This trend reflects the growing popularity of online platforms that cater to the on-demand lifestyle of modern consumers, offering subscription models and easy reordering options that enhance customer loyalty.

Get more detailed insights about Coffee Pods and Capsules Market

Regional Insights

By Region, the study provides the market insights into North America, Europe, Asia-Pacific and Rest of the World. Europe coffee pods and capsules market is anticipated to have the largest market for coffee pods and capsules, with Germany, the UK, France, and Russia being the nations with the most promising growth prospects. The region's market domination is mostly attributable to expanding consumer demand for new products with technological advancements, easy-to-use coffee capsules and pods, automatic bean-to-cup coffee makers, and rising demand for new products with technological advancements.

Throughout the forecast period, the region's market is projected to be driven by an increase in the number of coffee shops, small roasters, small local brands, and baristas in the area as well as consumers' growing interest in specialty coffee and K-Cups.

Further, the major countries studied in the market report are: The U.S, Canada, Germany, France, UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil.

The North American market, which includes the United States, Canada, and Mexico, is expected to account for a sizable revenue share of the worldwide coffee pods and capsules market during the study period. North America is a significant market for coffee pod and capsule makers. The primary elements responsible for the regional market's growth are rising coffee consumption, producers' expanding product portfolios, and the presence of a diverse consumer base. Further, the German coffee pods and capsules market held the largest market share, and the UK coffee pods and capsules market was the fastest growing market in the European region.

The Asia-Pacific Coffee Pods and Capsules Market is the third largest region. Given the shift in preferences brought about by millennial' changing consumption habits, China presents a significant opportunity for major coffee retailers. The increase in product costs and the issues surrounding the use of plastic in coffee capsules and pods present opportunities for players to innovate in the market. Moreover, China coffee pods and capsules market held the largest market share, and the India coffee pods and capsules market was the fastest growing market in the Asia-Pacific region.

Coffee Pods and Capsules Market Regional Image

Key Players and Competitive Insights

Major market players are spending a lot of money on R&D to increase their product lines, which will help the coffee pods and capsules market grow even more. Market participants are also taking a range of strategic initiatives to grow their worldwide footprint, with key market developments such as new product launches, contractual agreements, mergers and acquisitions, increased investments, and collaboration with other organizations. Competitors in the coffee pods and capsules industry must offer cost-effective items to expand and survive in an increasingly competitive and rising market environment.

One of the primary business strategies adopted by manufacturers in the coffee pods and capsules industry to benefit clients and expand the market sector is to manufacture locally to reduce operating costs. In recent years, coffee pods and capsules industry has provided medicine with some of the most significant benefits. The coffee pods and capsules market major player such as Illycaffè S.p.A.(Italy), Keurig Dr Pepper, Inc.(US), Melitta (Germany), The Kraft Heinz Company (US), and others are working to expand the market demand by investing in research and development activities.

The J.M. Smucker Corporation, popularly known as Smuckers, is an American food and beverage business. The company, headquartered in Orrville, Ohio, was formed in 1897 as a producer of apple butter. M. Smucker's current business units are consumer goods, pet foods, and coffee. Smucker's, the company's flagship brand, makes fruit preserves, peanut butter, syrups, frozen crustless sandwiches, and ice cream toppings. Jerome Monroe Smucker created the J.M. Smucker Company in 1897. Smucker spent a large portion of his life as a farmer in Orrville, Ohio, where he was born on December 5, 1858.

Smucker constructed a cider mill in Orrville in 1897. In February 2022, The J.M. Smucker Corporation released the 1850 coffee product line. This has aided the corporation in broadening its product offering.

Nestlé produces the coffee brand Nescafé. It comes in a variety of forms. The name is a combination of the terms "Nestlé" and "café". Nestlé launched their main coffee brand in Switzerland on April 1, 1938. Nestlé began establishing a coffee brand in 1930, at the request of the Brazilian government, to assist in the preservation of the significant surplus of the yearly Brazilian coffee harvest. The development effort was led by Max Morgenthaler. Nestlé launched the new beverage under the brand name "Nescafé" on April 1, 1938.

Nescafé is a soluble powdered coffee that acquired a household name in the United States during World War II. October 2022 - Nestlé's most recognisable coffee brand and one of the most well-known coffees in the world, Nescafé, today unveiled The Nescafé Plan 2030, the company's comprehensive plan to support more sustainable coffee cultivation. The organisation is accelerating its ten-year-old Nescafé-related initiatives. Work together with coffee growers to help them transition to regenerative agriculture.

Key Companies in the Coffee Pods and Capsules Market market include

Industry Developments

In April 2024, A leading supplier of polylactic acid (PLA) biopolymers derived from renewable sources, NatureWorks, has built a compostable coffee pod solution ideal for use with Keurig® brewers in the North American market. This accomplishment was made possible through a collaboration with IMA Coffee, a global leader in coffee handling, processing, and packaging technologies. The solution provides brilliant brewing performance, can be generated at commercial speeds comparable to existing options, and is made with eco-friendly, biodegradable materials.

In September 2022, the Swiss coffee brand "CoffeeB" introduced single-serve coffee, a novel compressed coffee ball made from seaweed rather than an aluminum or plastic capsule.

In August 2022. Tim Hortons will launch four new espresso capsules compatible with Nespresso Classic, bright, bold, and decaf are the four flavors available.

In October 2021, Starbucks by Nespresso will offer a new line of coffee capsules called Nespresso Vertuo, giving Canadian coffee aficionados more ways to experience the characteristic café flavor.

Future Outlook

Coffee Pods and Capsules Market Future Outlook

The Coffee Pods and Capsules Market is projected to grow at a 6.21% CAGR from 2024 to 2035, driven by convenience, sustainability, and innovation in product offerings.

New opportunities lie in:

  • Expansion into eco-friendly pod materials
  • Development of subscription-based delivery services
  • Integration of smart brewing technology in machines

By 2035, the market is expected to solidify its position as a leader in the coffee industry.

Market Segmentation

Coffee Pods and Capsules Market Coffee Type Outlook

  • Traditional
  • Decaf

Coffee Pods and Capsules Market Distribution Channel Outlook

  • Store-Based
  • Non-Store-Based

Report Scope

MARKET SIZE 202416.04(USD Billion)
MARKET SIZE 202517.03(USD Billion)
MARKET SIZE 203531.11(USD Billion)
COMPOUND ANNUAL GROWTH RATE (CAGR)6.21% (2024 - 2035)
REPORT COVERAGERevenue Forecast, Competitive Landscape, Growth Factors, and Trends
BASE YEAR2024
Market Forecast Period2025 - 2035
Historical Data2019 - 2024
Market Forecast UnitsUSD Billion
Key Companies ProfiledMarket analysis in progress
Segments CoveredMarket segmentation analysis in progress
Key Market OpportunitiesGrowing demand for sustainable and recyclable Coffee Pods and Capsules presents significant market opportunities.
Key Market DynamicsRising consumer preference for convenience drives innovation and competition in the coffee pods and capsules market.
Countries CoveredNorth America, Europe, APAC, South America, MEA

Market Highlights

Author
Pradeep Nandi
Senior Research Analyst

I have a bachelor's degree in mechanical engineering and an MBA. I have more than two years of expertise in the retail, food, and beverage, chemical, and material industries, and hence have developed a sound cross-domain expertise. A firm believer in lifelong learning and sharing of knowledge. Having a proclivity for hatching ideas and trying to absorb as much information as possible in a short amount of time. Introducing corporates to the data and insight, which enables them to move from probability to possibility, has been my key areas of interest. 

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FAQs

What is the current valuation of the Coffee Pods and Capsules Market?

As of 2024, the Coffee Pods and Capsules Market was valued at 16.04 USD Billion.

What is the projected market size for the Coffee Pods and Capsules Market by 2035?

The market is projected to reach 31.11 USD Billion by 2035.

What is the expected CAGR for the Coffee Pods and Capsules Market during the forecast period?

The expected CAGR for the Coffee Pods and Capsules Market from 2025 to 2035 is 6.21%.

Which companies are considered key players in the Coffee Pods and Capsules Market?

Key players in the market include Nestle, Keurig Dr Pepper, JDE Peet's, Lavazza, Starbucks, Peet's Coffee, Café Royal, Illy, and Tassimo.

How does the market segment for Traditional coffee compare to Decaf coffee?

In 2024, the Traditional coffee segment was valued at 10.0 to 19.0 USD Billion, while the Decaf segment ranged from 6.04 to 12.11 USD Billion.

What are the two main distribution channels for Coffee Pods and Capsules?

The two main distribution channels are Store-Based, valued at 10.0 to 19.0 USD Billion, and Non-Store-Based, valued at 6.04 to 12.11 USD Billion.

How does the Coffee Pods and Capsules Market's growth potential appear?

The market's growth potential appears robust, with a projected increase in valuation from 16.04 USD Billion in 2024 to 31.11 USD Billion by 2035.

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