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    Coffee Pods and Capsules Market

    ID: MRFR/CR/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 Market Research Future Analysis, the Global Coffee Pods and Capsules Market was valued at USD 14.3 billion in 2022 and is projected to reach USD 21.8 billion by 2030, growing at a CAGR of 6.21% from 2024 to 2030. The market is driven by increasing consumption of coffee pods and capsules, the rise of coffee machines simulating café experiences at home, and a growing demand for healthy organic options. The European region is expected to dominate the market, with significant growth in Germany, the UK, and France. Innovations in product offerings, such as compostable capsules, are also shaping the market landscape.

    Key Market Trends & Highlights

    Key trends influencing the coffee pods and capsules market include:

    • Rising use of coffee machines for home café experiences is propelling market growth.
    • The traditional coffee segment held the largest market share in 2022, while decaf is expected to grow fastest.
    • Non-store-based distribution channels are predicted to grow at the fastest rate during the forecast period.
    • The European market is anticipated to have the largest share, driven by consumer demand for innovative products.

    Market Size & Forecast

    2022 Market Size USD 14.3 Billion
    2030 Market Size USD 21.8 Billion
    CAGR (2024-2030) 6.21%

    Major Players

    Key players include Keurig Dr Pepper, Nestlé S.A., Illycaffè S.p.A., The Kraft Heinz Company, and The J.M. Smucker Company.

    Coffee Pods and Capsules Market Trends

    Rising use of coffee makers to simulate a cafe experience at home to propel market growth

    One of the primary aspects driving the industry is the increasing use of coffee machines to replicate a cafe-style experience at home. Furthermore, coffee use is increasing because it helps people feel less exhausted, boosts energy levels, burns fat by reactivating the body's metabolism, and improves productivity and brain functioning. This, combined with the quality, efficiency, and variety of options provided by coffee pods and capsules, is fueling the market's CAGR. Additionally, there is an increase in demand for instant non-alcoholic drinks among the public.

    This, together with the expanding number of premium coffee shops around the world, is having a beneficial impact on the market. Furthermore, the widespread availability of coffee pods and capsules via online and offline distribution channels provides significant growth potential for industry investors. Aside from that, prominent industry players are developing novel coffee tastes in order to increase overall sales and profitability. They are also investing heavily in promotional activities via social media channels. Additionally, consumers who are fitness-focused must consume healthy beverages.

    As a result, the demand for healthy organic coffee capsules and pods is growing among consumers, which provides manufacturers with plenty of opportunities to innovate in the coffee pods and capsules market revenue.

    For instance, the Spanish coffee company Cafés Novell introduced a line of organic coffee capsules for retail coffee shops and home use in 2022. The beginning of completely compostable and 100% natural is the No Waste line of coffee capsules in the UK. Because of the growth in product innovation in organic offerings, which is consistent with changing consumer tastes and preferences, it is expected that the demand for coffee pods and capsules will rise more quickly during the projected period.

    December 2023 - ATI and TIPA have disclosed a 'first-of-its-kind' completely compostable lid for coffee capsules, line up with upcoming compostability legislation, and enhance barrier protection, protection against material migration, sealing properties, and more. Supposedly, the patent-protected lidding material matches all compostable coffee filling lines, variations, and capsules, including the Nespresso system. It focuses on catering as an environmentally friendly addition to Nespresso's present compostable capsules in France and Switzerland, with TIPA establishing that 29,000 plastic coffee capsules are sent to landfills every minute across the globe.

    The plant-based lid has got OK Biobased's biggest accreditation of four stars – showcasing the lowest possible carbon content of 80%, with the carbon obtained from renewable raw materials – and has been accredited by its official laboratories. It is designed to solve earlier challenges faced by producers with sustainability-minded capsule lids, such as poor sealing properties, inconsistent or non-existent flow, delamination, a lack of barrier protection, and materials moving into the beverage itself. TIPA also asserts that the lidding material can be enhanced beside the coffee grind for high extraction quality.

    In the end, the lid is intended to be disposable in food waste bins as per the EN 13432 protocol. This comes in the category with the UK Plastics Pact's target of guaranteeing all coffee capsules are made with compostable materials and the Packaging and Packaging Waste Regulation's mandate that coffee capsules should be compostable in nations where they can be gathered in food waste bins.

    The growing consumer preference for convenience and sustainability is reshaping the coffee landscape, driving innovation in coffee pods and capsules to meet evolving demands.

    U.S. Department of Agriculture

    Coffee Pods and Capsules Market Drivers

    Market Growth Projections

    The Global Coffee Pods and Capsules Market Industry is poised for substantial growth, with projections indicating a rise from 15.1 USD Billion in 2024 to 29.5 USD Billion by 2035. This growth trajectory suggests a robust compound annual growth rate of 6.27% from 2025 to 2035. Factors contributing to this expansion include increasing consumer demand for convenience, technological advancements, and the diversification of product offerings. As the market evolves, it is likely that new entrants will emerge, further intensifying competition and innovation. This dynamic environment presents opportunities for both established brands and new players to capitalize on the growing demand for coffee pods and capsules.

    Sustainability Initiatives

    Sustainability emerges as a pivotal driver in the Global Coffee Pods and Capsules Market Industry, as consumers become more environmentally conscious. Companies are increasingly adopting eco-friendly practices, such as using biodegradable materials for coffee pods and capsules. This shift not only addresses consumer concerns but also aligns with global sustainability goals. For instance, brands are investing in recyclable packaging and promoting responsible sourcing of coffee beans. As the market evolves, it is anticipated that sustainability will play a crucial role in shaping consumer preferences, potentially influencing purchasing decisions and brand loyalty in the coming years.

    Expansion of E-commerce Platforms

    The expansion of e-commerce platforms plays a crucial role in the Global Coffee Pods and Capsules Market Industry, as online shopping becomes a preferred method for consumers. The convenience of purchasing coffee pods and capsules online allows for greater accessibility and variety. As more consumers turn to e-commerce, brands are optimizing their online presence to capture this growing segment. This shift not only facilitates easier access to products but also enables companies to reach a global audience. The projected compound annual growth rate of 6.27% from 2025 to 2035 suggests that e-commerce will continue to be a vital channel for market expansion.

    Growing Consumer Demand for Convenience

    The Global Coffee Pods and Capsules Market Industry experiences a surge in consumer demand for convenience, as busy lifestyles drive the need for quick and easy coffee solutions. With the market projected to reach 15.1 USD Billion in 2024, the appeal of single-serve coffee options becomes increasingly evident. Consumers favor the simplicity of coffee pods, which allow for rapid preparation without sacrificing quality. This trend is particularly pronounced among millennials and working professionals, who prioritize efficiency in their daily routines. As a result, manufacturers are innovating to meet this demand, introducing a variety of flavors and blends to attract a broader audience.

    Diverse Flavor Profiles and Product Offerings

    The Global Coffee Pods and Capsules Market Industry thrives on the diversity of flavor profiles and product offerings available to consumers. With an increasing number of brands entering the market, competition drives innovation in flavor development. Consumers are no longer satisfied with traditional coffee options; they seek unique blends and specialty flavors. This trend is reflected in the growing popularity of seasonal and limited-edition offerings, which entice consumers to explore new tastes. As a result, brands are expanding their product lines to cater to evolving preferences, contributing to the overall market growth and enhancing consumer engagement.

    Technological Advancements in Brewing Systems

    Technological advancements in brewing systems significantly impact the Global Coffee Pods and Capsules Market Industry. Innovations such as smart coffee machines and app-controlled brewing systems enhance user experience and convenience. These technologies allow consumers to customize their coffee preferences, from brew strength to temperature, thereby increasing satisfaction. As the market evolves, the integration of technology is likely to attract tech-savvy consumers, further driving growth. The introduction of new brewing technologies may also lead to increased sales, contributing to the projected market growth from 15.1 USD Billion in 2024 to an estimated 29.5 USD Billion by 2035.

    Market Segment Insights

    Coffee Pods and Capsules Coffee Type Insights

    The coffee pods and capsules market segmentation, based on coffee type, includes traditional and decaf coffee. The traditional segment held the largest coffee pods and capsules market revenue in 2022, Traditional coffee beans have more caffeine and offer greater flavor and taste. While the decaf segment is predicted to grow at the fastest rate over the forecast period.

    Coffee Pods and Capsules distribution channel Insights

    The coffee pods and capsules market segmentation, based on distribution channel, includes store-based and non-store-based distribution channels. The store-based sector held a greater market share of 2022, while the non-store-based segment is predicted to grow at the fastest rate over the forecast period.

    Figure 1:  Coffee Pods and Capsules Market, by distribution channel, 2022 & 2030 (USD billion)Source: Secondary Research, Primary Research, Market Research Future Database and Analyst Review

    Get more detailed insights about Coffee Pods and Capsules Market Research Report—Global Forecast Till 2030

    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.

    Figure 2:   COFFEE PODS AND CAPSULES MARKET SHARE BY REGION 2022 (%)COFFEE PODS AND CAPSULES MARKET SHARE BY REGION 2022

    Source: Secondary Research, Primary Research, Market Research Future Database and Analyst Review

    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.

    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 6.27% CAGR from 2024 to 2035, driven by convenience, sustainability, and premiumization trends.

    New opportunities lie in:

    • Develop eco-friendly pod materials to capture environmentally conscious consumers.
    • Introduce subscription models for personalized coffee experiences.
    • Leverage technology for smart brewing systems to enhance user engagement.

    By 2035, the market is expected to exhibit robust growth, driven by innovation and evolving consumer preferences.

    Market Segmentation

    Coffee Pods and Capsules Regional Outlook

    • US
    • Canada

    Coffee Pods and Capsules By Coffee Type Outlook

    • Traditional
    • Decaf

    Coffee Pods and Capsules By Distribution Channel Outlook

    • Store-Based
    • Non-Store-Based

    Report Scope

    Report Attribute/Metric Details
    Market Size2022 USD 14.3 billion
    Market Size 2023 USD 15.1 billion
    Market Size 2030 USD 21.8 billion
    Compound Annual Growth Rate (CAGR) 6.21% (2024-2030)
    Base Year 2022
    Market Forecast Period 2024-2030
    Historical Data 2019- 2021
    Market Forecast Units Value (USD Billion)
    Report Coverage Revenue Forecast, Market Competitive Landscape, Growth Factors, and Trends
    Segments Covered Coffee Type, Distribution Channel and Region
    Geographies Covered North America, Europe, Asia Pacific, and Rest of the World
    Countries Covered The U.S, Canada, Germany, France, UK, Italy, Spain, China, Japan, India, Australia, South Korea, and Brazil
    Key Companies Profiled  IllycaffeS.p.A., Keurig Dr. Pepper Inc., Nestle S.A., Luigi LavazzaS.p.A., Dualit Limited, Jacobs, DouweEgberts B.V., The Kraft Heinz Company.
    Key Market Opportunities ·        Opportunities for financial gain are available throughout the Asia Pacific area.
    Key Market Dynamics ·        Increasing use of coffee pods and capsules in hotels and restaurants

    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

    How much is the coffee pods and capsules market?

    The coffee pods and capsules market size were valued at USD 14.3 Billion in 2022.

    What is the growth rate of the coffee pods and capsules market?

    The market is projected to grow at a CAGR of 6.21% during the forecast period, 2022-2030.

    Which region held the largest market share in the coffee pods and capsules market?

    Europe had the largest share in the market.

    Who are the key players in the coffee pods and capsules market?

    The key players in the market are IllycaffeS.p.A., Keurig Dr. Pepper Inc., Nestle S.A., Luigi LavazzaS.p.A., Dualit Limited, Jacobs, DouweEgberts B.V., The Kraft Heinz Company.

    Which coffee type segment will lead the coffee pods and capsules market?

    The key players in the market are IllycaffeS.p.A., Keurig Dr. Pepper Inc., Nestle S.A., Luigi LavazzaS.p.A., Dualit Limited, Jacobs, DouweEgberts B.V., The Kraft Heinz Company.

    Which coffee type segment will lead the coffee pods and capsules market?

    The traditional segment will lead the coffee pods and capsules market.

    What are the main elements influencing the market's expansion?

    Single-serve coffee pod and capsule use is expanding in developing countries, which is fueling market expansion.

    Coffee Pods and Capsules Market Research Report—Global Forecast Till 2030 Infographic
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