When 24-year-old Alex Stein is looking for a morning pick-me-up, he doesn't reach for a cup of cappuccino as his parents Len and Berdie did daily while he was growing up in Westchester County, New York he grabs an energy drink. Coffee just doesn't cut it with him. "The taste is just so bitter I couldn't have more than a couple of sips of it without needing to wash it down with water," he says.
A recent report from Mintel, a market-research firm, predicts that Stein's generation may become coffee-resistant unless marketers find ways to make coffee drinks relevant for kids under the age of 25. Demand for coffee remains robust among people aged 45 and over thanks to older customers, who will likely drive coffee's sales growth over the next five years, the report said.
However, the habits of the younger demographic make the industry's longer-term outlook murkier. According to the report, only 27% of people in the 18-to-24 age group consume coffee daily, with many citing taste, health concerns and a penchant for sweet energy drinks as factors keeping them away from coffee. By contrast, 75% of those ages 45 to 54 and 80% of those 55 to 64 have a daily cup of joe. Only 28% of the younger group said they liked the taste of coffee on its own, compared with 53% of 45-to-64-year-olds and 61% of those 65 and older. And members of the younger demographic who do drink coffee tend to visit cafés, where they can find sweeter-tasting blends like frappuccinos for their caffeine fix.
Stein discovered energy drinks at the University of Cincinnati after he spotted a blue-and-silver Mini with a giant Red Bull can on its hatch trolling around campus, offering free samples. After trying Red Bull, an energy drink that contains taurine and caffeine, and other such beverages, he's never looked back. Today, as a working architect in Manhattan, Stein says he still reaches for energy drinks never coffee.
Matt Yemma, a 26-year-old public-relations consultant, started swigging energy drinks while in college. "I believe the aggressive marketing of energy drinks such as Red Bull to the younger generation, mixed with the lousy taste and feeling that coffee gives me, is why I, and the younger generation, is gravitating away from drinking coffee," he says. "Even nowadays, if I'm really flagging in the afternoon, I'll just rip a Red Bull."
Should the coffee industry get anxious about these findings? "The concern is real," says Bill Patterson, a senior analyst at Mintel. He dismisses suggestions that the trend is a youth fad that kids will outgrow. "The older generations that now drink coffee were brought up on coffee, they always drank coffee, and they've taken that coffee-drinking habit all the way through their life," says Patterson. "I do not see the younger generation reaching middle age late 30s and beyond and going, 'Oh, I'm going to start drinking coffee now.' The mold has been broken."