Watch out, Tim Hortons: Canadians getting hooked on single serve coffee machines

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TORONTO — Watch out, Tim Hortons and Starbucks.

The coffee industry's push to sell machines that make single-serve specialty brews have upped the amount of java Canadians are drinking at home.

Coffee drinkers average two cups per day and two-thirds of them are brewing some their drinks at home, said Robert Carter, executive director of foodservice at the NPD Group, on Thursday.

The new report ``What's Brewing in the Canadian Coffee Market: A Consumer Perspective'' suggests auto-drip coffeemakers are still dominant for in-home, morning preparation but single-serve machines are being revved up in the afternoons, evenings and later at night. Over a quarter of Canadian coffee drinkers (27 per cent) said they sip coffee at home more than they did last year, and the same percentage stated they now consume the beverage less when they're out.

``The main driver is the innovation, convenience and ease of use of single-serve, in-home brewing systems,'' Carter said, particularly now that there are higher-quality brands available, like those made by Starbucks and Timothy's, for use in machines made by such companies as Keurig or Tassimo.

``We know overall consumers are motivated by convenience. The easier you make it, the more consumers will do something,'' he said. ``Fifty-seven per cent of all our restaurant visits are off-premise through the drive-thru in Canada so convenience is one of the key drivers and those coffee-pod machines are so convenient and simple to use at home.''

Coffee shops are not in hot water yet, however. Canadians still love to go out for coffee, especially to quick-serve restaurants in the morning for a cup of joe and a breakfast sandwich. Over the last year there were 1.7 billion servings of coffee consumed in these restaurants, a three per cent increase over the year before. In fact, Canadians quaff more coffee outside of home per capita than any other country except Italy, Carter said.

``With some of the burger guys getting into the coffee game they're stealing share from some of the other players in the market and that's driving some of the volume of coffee consumption,'' Carter said. ``I think there is definitely some switching going on. The upscaling within some of the operators, like the McDonald's with the McCafes, is driving some of the increased consumption.''

Brewed cups are where the coffee shops are mostly cashing in. When Canadians visit their local coffee houses, 80 per cent buy a quick brew rather than an espresso or an espresso-based beverage.

Specialty hot espresso-type beverages are more popular during the morning and afternoon break periods, Carter said, adding there were 390 million servings sold last year, an eight per cent growth over the previous year.

The consumption of iced, slushy-type coffee beverages is the industry's fastest-growing category, Carter said. Last year there were 161 million servings consumed through quick-service outlets, a 15 per cent increase over the year before. The research showed that iced coffee is twice as likely to be consumed on the weekend than during the week.

NPD tracks purchase behaviour in the out-of-home foodservice segment through a panel of 100,000 consumers online.

Organizations: Tim Hortons, Starbucks, NPD Group Keurig McDonald's

Geographic location: TORONTO, Canada, Italy

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