Published On Apr 09, 2018 in
Areas of Expertise and Retail Real Estate Industry
Coffee has transformed from just a morning necessity into a social activity. It has reached beyond an energy jolt to a true experience that somehow simultaneously stimulates and soothes.
The coffee culture affects me on a personal basis daily. Just this morning, a colleague who has been with Phillips Edison for 15 years asked me to go along on a coffee run. I learned some valuable lessons from an industry vet in those few minutes over a cup of joe.
Coffee also has an impact on my work in the retail community. While the popular beverage has been an easily obtainable commodity for centuries, coffee shops are still popping up in developments at an exponential rate. Ever feel like there’s a coffee shop on every corner? In 1990, there were 84 Starbucks in operation. Today, there are 24,000 stores.
As the prevalence of coffee shops continues to grow, several trends have become evident. In the name of research, I took a highly caffeinated tour of my favorite Atlanta cafés that exemplify some of my favorite trends:
Many cafés are implementing a reason to keep you around, whether it’s a tour of their roasting facilities, live music or art exhibits. Atlanta’s East Pole Coffee has bleacher seating on the exterior, and a room with floor-to-ceiling windows offering a fabulous view of their roasting equipment. Java Monkey hosts poetry sessions and live music and allows patrons to stay until 11 pm to enjoy the experience.
Our favorite major national chains are implementing coffee shops into their stores. Nordstrom has added their Ebar into stores, offering handcrafted beverages and convenient food choices. Whole Foods, among other grocers, has coffee shops at most of their stores. In Atlanta, they are embracing the scene with Southeastern-based Revelator Coffee shops in their local stores.
Buzz and Brew
A growing number of coffee shops are selling alcohol alongside their coffee selection. One of my favorite Atlanta coffee “bars” is Octane, which serves up coffee and craft cocktails under one roof. The chain has grown to seven units since 2003. Another great choice, ParkGrounds, allows patrons to bring their dogs and begs the question, “Who is truly man’s best friend- the dog, the coffee bean, or the malted beverage?” Even Starbucks has jumped onto the boozy bandwagon, adding wine and beer to many of their cafes’ menus.
Though 70% of coffee sales are generated from the top 50 coffee shop operators, as millennials desire for authenticity and sustainability grows, coffee curators are finding ways to develop local and regional offerings. National brands are realigning their products and marketing to feel more genuine and providing local giving-back initiatives, while true mom-and-pop shops are emerging constantly. A great example is South Atlanta’s Community Grounds. With the tagline “Committed to Local,” this coffee bar seeks to provide employment to struggling Atlanta residents. The café has even expanded into a grocery market in the center of a food desert.
The coffee industry is expected to reach $46.2 billion by 2021. Though Starbucks and the like aren’t going anywhere, the emerging trends surrounding this hot beverage industry will have us buzzing in more ways than one.
Side note— there is also a café in Atlanta called Java Cats, that serves as a cat adoption facility and allows customers to play with cats while drinking specialty brews. I don’t see this one as a largely impactful trend, but it’s quite innovative!