Hot beverage maker* is fastest growing category in Small Domestic Appliance industry
Coffee drinking has become so increasingly widespread in Korea that not only are international and local coffee franchises mushrooming across the country, coffee machines for home use are also enjoying brisk sales, according to GfK Korea. Retail audit reports from the leading global market research company revealed more than 300,000 units of such machines sold in Korea in 2011, nearly 82,000 more and a substantial 38 percent jump in volume sales as compared to the previous year.
The value of the coffee machine market has escalated significantly by no less than USD10 million within a year and is currently worth approximately USD 29.5 million. This rapid 50 percent expansion makes it the country’s fastest growth engine within the Small Domestic Appliance industry in 2011.
“Coffee appreciation is truly becoming a trend in Korea, and not only is this rapidly growing phenomenon happening at hip coffee chains, Koreans are also taking this culture into the comfort of their own home,”
observed Mr. Moongen Kwon, General Manager of GfK Korea. “GfK Korea retail tracking reports reflect strong consecutive year-on-year expansion in the value of the coffee machine market in 2010 and 2011, translating to a two-fold growth within a span of just two years!”
The more popular and affordable filter coffee machines have been dominating the market in terms of volume sales with over four out of every five (83%) coffee machines sold belonging to this segment. However, it is the sales coming from the more expensive Espresso makers which contribute a larger share in terms of value. In 2011, this segment contributed 62 percent to the overall coffee machine market worth, a considerable increase from the previous year’s 48 percent.
Findings also showed that whereas average prices of the filter coffee machines have remained stable, hovering below USD50, average cost of the most expensive range—the fully automatic Espresso makers have been rising consecutively in the last three years to hit nearly USD 1,320 in 2011, with prices of popular models costing between USD380 to USD2,580.
“Trendy joints like Starbucks and Coffee Bean & Tea Leaf have established and helped cultivate a coffee culture in the country, not to mention also raising expectations amongst consumers on how their home made coffee should taste,” noted Mr. Kwon. “Today’s fast pace of life in tandem with rising affluence of society has increased the appeal of coffee machines which can help consumers fulfill their desire for that perfect cup of brew in the convenience of their own home.
We can expect the market to further flourish as more are more willing to shell our premium prices for such machines which are able to help enhance their hectic lifestyle.” Coffee machine is a growing segment of the Small Domestic Appliances industry which includes household appliances such as food preparation equipment, rice cooker, iron, vacuum cleaner, shaver, etc. In 2011, the overall industry continues to record good growth, with 2011 hitting USD1.4 billion—USD132 million more than 2010.