Why Australians – and the rest of the world – prefer to drink their coffee at home

Breakfast and coffee at home in Australia
  • Weekday breakfast transactions are down by more than 5% since 2019 in Melbourne 
  • Consumers worldwide seem to be going out less, but it’s more complicated
  • There’s a long term shift towards artisanal and DIY, especially for younger generations

RECENT OBSERVATIONS in Australia point to a significant adjustment in consumer behaviour as people prioritise their spending amidst the rise of hybrid work arrangements and escalating living costs. 

The trend of skipping pre-work takeaway coffee and breakfast in favour of indulging in weekend meals reflects a strategic shift in consumption habits among Australians. 

Weekday breakfast transactions are down by more than 5% in Melbourne while weekend brunch volumes are up 4%, compared with 2019 levels, according to an analysis of millions of transactions at restaurants and cafes.

“In Melbourne we’ve seen a lot of people who would normally go to a cafe in the morning begin to do this at home,” says Émilie Coulombe, Business Development Manager at Condesa Co.Lab and board member of IWCA Australia. “I think home setups are increasingly common. Coffee drinkers in general have started to do this as part of their morning routine at home.”

This adjustment is driven by a desire to allocate resources more judiciously, balancing weekday routine savings with weekend indulgences, in response to evolving economic and lifestyle dynamics. The surge in at-home coffee consumption signifies a broader trend in Australia, where people are opting for the comfort and convenience of home-brewed coffee over daily takeaway rituals. 

Factors like cost considerations, changing work patterns, and a preference for personalised coffee experiences are influencing this shift towards home coffee rituals. This transformation underscores a desire for more intentional and value-driven spending choices among Australians.

“Morning coffee has a more utilitarian function – waking up in order to be ready for the day – to save money in order to focus on more symbolic and social consumption experiences,” says Alessandro Gerosa, Assistant Professor in Cultural Sociology at the Università degli Studi di Milano, and author of recently published book “The Hipster Economy”.

Are consumers really going out less? It’s more complicated

The impact of the COVID-19 pandemic on consumer behaviour extends beyond Australia, with global trends indicating a shift towards reduced discretionary spending and a more conservative approach to consumption. Last year, The Economist labelled this “the age of the hermit consumer”.

While some consumers are venturing out less due to health concerns and safety precautions, and making more coffee and baked goods at home, it’s more complicated. Many are just opting to spend less frivolously, focusing on essential purchases and value-driven expenditures.

“I don’t think we’re witnessing a new age of ‘hermit consumers’,” says Alessandro. “Despite being very appealing, such announcements are almost always exaggerated. I believe that COVID-19 has only accelerated a paradigm that was already present at least since the crisis of 2008, to provide a taste of artisanal qualities and authenticity at affordable prices.”

Consumer preferences have shifted towards products and services that offer convenience, affordability, and quality. Brands that emphasise sustainability, authenticity, and social responsibility are resonating with consumers seeking more meaningful and purposeful consumption experiences. 

“We’re seeing a lot more people working from home, and with interest rates and cost of living increasing, people are definitely prioritising where their hard-earned money is going,” says Émilie.

“They’re looking to minimise costs where possible so they can splurge on more significant things or more intentional experiences, like a weekend brunch with loved ones, or a coffee at a fancy place, for example.”

The recalibration of spending habits post-pandemic – or even arguably since the 2008 economic crisis – highlights a shift towards conscious consumerism, where individuals prioritise value, authenticity, and sustainability in their purchasing decisions.

“Another relevant trend, which the pandemic accelerated and constitutes a byproduct of the same paradigm, is the allure of DIY practices,” says Alessandro. “This encourages people to prepare their flat white themselves, for example – and maybe some sourdough bread or croissants – as a pleasurable artisanal act.”

flat white

From the boomer allure of “modern industrial” to millennial “craft” and Gen Z “DIY” appeal

The coffee industry has witnessed a notable transformation in consumer preferences, transitioning from a focus on industrial “modern” product appeal to a growing demand for “craft” artisanal experiences both during and prior to the pandemic. 

This shift towards artisanal coffee offerings underscores a broader trend towards authenticity and uniqueness in consumer preferences, particularly among millennials and Gen Z, and people seeking more personalised and genuine experiences.

It also plays into the “do-it-yourself” (DIY) approach that Gen Z have a weakness for, but not only. Be it furniture, beauty products (thanks to TikTok), cleaning products, baked goods or coffee, people are having fun experimenting at home – and saving money and learning a skill along the way.

“Many millennials improved their coffee-making skills during COVID when they were stuck at home, and ordered high-end coffee makers and coffee grinders to make specialty coffee at home,” says Virginia Lee, food and beverage consultant and contributing writer for The Food Institute

“They like to know where their coffee is produced and are looking for supply chain transparency, and the story behind the coffee farm and coffee roaster.”

While each generation of consumers broadly retain their specific preferences, most have been impacted by inflation and the need to cut costs. Each segment is broadly moving towards higher at-home consumption, but each in their own particular way. 

“Even if these shifts are not rigidly exclusive to boomers, millennials or Gen Z, there’s certainly a link between them,” says Alessandro. “While boomers are in general more tied to an industrial logic of consumption and millennials to a more purely artisanal one, Gen Z tend to experience the effects of the cost of living crisis more on their consumption habits.”

This shift is reshaping the coffee market, triggering new dynamics of supply and demand. Coffee brands seek to capitalise on emerging trends, bringing a new wave of DIY and at-home products to the market. Nescafé just launched its Espresso Concentrate Coffee product in Australia and China, for example, a product that allows consumers to make an endless range of coffee drink creations at home.

“Supermarket sales of specialty coffees have gone up,” says Émilie. “We’re seeing more innovations with instant coffee and Nespresso machine (or similar) compatible pods, and grinders and barista coffee equipment geared to home users – so I think brands are increasingly targeting home consumers.”

It seems the world is shifting towards a new way of consuming – but it’s not a clear-cut case more at-home versus out-of-home consumption. There is a time and place for both. It seems to be a shift driven by a combination of economic context, the aftermath of a global pandemic, and core values that are changing.

Consumers are telling brands that their time and money are precious, and brands and coffee shops will need to listen and adapt their products and models accordingly.

Coffee Intelligence

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