Coffee report by Euromonitor
There has been much attention paid to Starbucks’ ambitious plans to finally enter the Italian market. The company has long viewed Italy as forbidden territory because of Italians’ strong national pride in their coffee culture, but finally decided to take the leap on the wager that younger Italians are less particular than their elders and may be interested in the same coffee drinks as their peers everywhere else. This has naturally inspired much hand-wringing about the direction of Italian coffee, both in Italy and abroad.
Receiving less attention, but perhaps more significant in the long run, is the changing nature of Italy’s most important coffee company, Lavazza. Once a national company that focused its efforts nearly exclusively on fresh coffee within Italy, Lavazza is now the third-largest coffee company in the world, with interests in many more categories and geographies than it once did. Creating a company that appeals to Australians, Americans, and Estonians the way it does to Italians has naturally required Lavazza to change the way it operates. The major question hanging over the future of the company is whether it can do that while also keeping its core identity intact.
Growth in the homeland of the espresso is running out of steam
The coffee market in Italy is stagnant, with volumes expected to expand by just 0.2% during the entire forecast period. The Italian coffee market is simply too mature for major volume growth to be possible anymore. What growth there is now comes mostly from increases in population and income and, given Italy’s low fertility rate (1.4 children per woman) and anaemic economy (under 1% growth every year since 2010), that means that the situation is unlikely to turn around anytime soon.
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