The Reign of the Coffee Pod Could Be Over

By Mike Pomranz |
FWX KEURIG REGRETS_0

Coffee pods have grown to an almost shocking popularity over the past decade. Ten years ago, you mostly only found them in company breakrooms, but by 2011, coffee pods were a $1 billion industry. Last year, that number crossed the $4 billion mark.

But market research firm Euromonitor says that the reign of the coffee pod may have been nothing more than a product of the great recession and an improved economy might start to squeeze the industry from both financial ends.

First, though pods are cheaper than buying a cup of coffee from the store, they are still seven times more expensive than brewing bagged coffee. This can have a surprising number of ramifications. For people who want to save money, brewing yourself will always be the better option, especially if an improved economy means they have more time on their hands to do things besides rushing from one part-time job to the next. But even for people who are happy to spend more on coffee, America’s newfound embrace of pricey items like single-origin beans, means that people want to invest their coffee dollars in quality as much as convenience.

Which brings us to pod’s second problem: It’s still coffee from a pod. At the risk of offending pod devotees, a similar comparison would be that no matter how good a microwave meal is, it will always be a meal from the microwave. Consumers growing interest in small batch roasters and different brewing techniques could harm the Keurigs of the world. “American coffee consumers are far savvier than ever before. Even though they are a minority group, it is with these consumers where growth lies,” said Euromonitor analyst Eric Penicka. “In these artisanal coffee shops…new methods, or I should say forgotten methods, have come into the lime light. While expresso machines play a part in spec coffee shops, pour-over has come front and center giving Americans a new way to discover familiar products.”

Or to put it another way, pour-over killed the K-cup star.

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