Europe Coffee Pods and Capsules Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Europe Coffee Pods and Capsules Market is segmented by Product Type (Pods and Capsules), Distribution Channel (On-trade and Off-trade), and Geography (Germany, United Kingdom, France, Russia, Spain, Italy, Switzerland, Netherlands, and Rest of Europe). The report offers the market sizes and forecasts (USD million) for the above segments.

Market Snapshot

Europe Coffee Pods and Capsules Market
Study Period: 2016-2027
Base Year: 2021
CAGR: 6.8 %

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Market Overview

The European coffee pods and capsules market is projected to register a CAGR of 6.8% during the forecast period (2022-2027).

The COVID-19 pandemic affected the market negatively during the first quarter. However, with the rise in online sales of products, the market saw steady growth. The disruption in out-of-home coffee sales compelled the major coffee chains to boost sales through retail packaging. For instance, in 2020, Costa Coffee, Europe's biggest coffee chain, expanded the sales of its packaged coffee across the region, offsetting the pandemic's impact.

The growth drivers of coffee pods and capsules in Europe over the past few years have been a combination of convenience, premium positioning, brand experience, and the ability of manufacturers to innovate and provide new products. The changing and busy lifestyle of consumers have added to the growth of coffee sales, and people are more interested in using espresso machines, even at home. This has led to a surging demand for coffee pods and capsules, which are compatible to use in various espresso machines.

The popularity of coffee pod machines in significant markets such as the United Kingdom is significantly increasing, owing to a rise in the average retail selling price of coffee, which is driving the growth of the coffee pods market in the country. On the other hand, a significantly large number of consumers are switching from instant coffee to more premium options, such as fresh ground coffee pods and coffee beans, which is expected to boost the sales of coffee pods during the forecast period.

Scope of the Report

Coffee pods and capsules are basically ready-to-make coffee used in espresso machines. The coffee capsules are vacuum packed, which ensures hygiene and avoids humidity, while the coffee pods are single-dose packs of coffee. The European coffee pods and capsules market is segmented by product type, distribution channel, and geography. Based on product type, the market is segmented into pods and capsules. Further, on the basis of distribution channel, the market is segmented into on-trade and off-trade channels, where the off-trade channel is further divided into supermarkets/hypermarkets, specialty stores, online retail, and other distribution channels. By geography, the market is segmented into Germany, the United Kingdom, France, Russia, Spain, Italy, Switzerland, the Netherlands, and the Rest of Europe. For each segment, the market sizing and forecasts have been done on the basis of value (in USD million).

Product Type
Distribution Channel
Specialty Stores
Online Retail
Other Distribution Channels
United Kingdom
Rest of Europe

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Key Market Trends

Increasing Demand for Single-serve Coffee

The rise in demand for single-serve coffee, owing to the convenience of use, is driving the demand for coffee pods and capsules. The convenient forms of coffee, like the coffee pods and capsules, are becoming popular among consumers in the region. These coffee pods and capsules are extensively used to prepare decent coffee at home in less time. The penetration rates of single-serve coffee brewers in different households of Europe, especially Western Europe, have increased in recent times. Additionally, the demand for coffee machines is increasing, leading to an upsurge in demand for coffee pods and capsules that are used in various coffee machines. Nespresso is the widely used coffee machine in Europe. Companies are also introducing their products in ways that are compatible to Nespresso machines. For instance, in 2021, Luigi Lavazza SpA, an Italian producer and distributor of coffee, launched coffee capsules having zero carbon dioxide impact, which were Nespresso compatible.

europe coffee pods and capsules

Supermarkets/Hypermarkets Lead the Distribution Channel Segment

The demand for coffee pods and capsules in Europe is mostly driven by supermarkets and hypermarkets, followed by online retail and on-trade channels, mostly because of out-of-home consumption. Owing to a vast retail space and catering to a wide variety of preferences, supermarkets/hypermarkets are the dominant channels for the sales of coffee products. Supermarkets/hypermarkets have an abundance of choices across brands and functionality. These markets sell both pods and capsules in a pre-determined price range, providing high-quality coffee. Supermarkets have also been offering an increasing range of coffee with unique characteristics, such as single origins. The wide product visibility at these supermarkets and hypermarkets has boosted the consumer base, further escalating the rising sales of coffee pods and capsules. These supermarkets/hypermarkets are expanding their chain of stores to make their presence visible throughout the region. For instance, in 2021, Lidl, a Russian supermarket chain, which was spread across different places in Europe, opened its first store in the United Kingdom.

europe coffee pods and capsules

Competitive Landscape

The European coffee pods and capsules is a competitive market with a large number of international and regional players. The market is fragmented, and the major players operating in the market are Nestle SA, Luigi Lavazza SpA, Starbucks Corporation, and JAB Holding Company, among others. Nestle SA holds a significant share in the market compared to other players. The major companies are entering partnerships and expanding their facilities across the region to strengthen their consumer base and maintain their positions in the market. Partnerships and joint ventures are the most adopted strategies that enable significant players to increase control over competitive pricing and gain a competitive advantage. Product innovation catering to consumer demands is another strategy frequently opted by companies.

Major Players

  1. Nestle S.A.

  2. Starbucks Corporation

  3. Coind Group

  4. Luigi Lavazza SpA

  5. JAB Holding Company

Europe Coffee Pods and Capsules Market_Market Concentration.PNG

Recent Developments

In 2021, Gordon St Coffee, a Scottish roastery, launched sustainable coffee capsules in the United Kingdom. These Nespresso-compatible coffee capsules are prepared using Solinatra, which acts as a biomaterial alternative to single-use plastic items.

In 2021, Halo Coffee, a UK-based start-up, expanded the availability of its home-compostable coffee capsules in continental Europe. These paper coffee capsules are 100% compostable and made with sugarcane and paper pulp. These capsules are also 100% Nespresso-friendly, adding the convenience of use.

In 2021, Capsul'in Pro, a Luxembourg-based company, launched its Zero impact coffee capsule, which is Nespresso-compatible and 100% biobased and home compostable. This coffee capsule is plant-based in nature and does not contain any derivatives of fossil fuels.

Table of Contents


    1. 1.1 Study Assumptions and Market Definition

    2. 1.2 Scope of the Study




    1. 4.1 Market Drivers

    2. 4.2 Market Restraints

    3. 4.3 Porter's Five Forces Analysis

      1. 4.3.1 Threat of New Entrants

      2. 4.3.2 Bargaining Power of Buyers/Consumers

      3. 4.3.3 Bargaining Power of Suppliers

      4. 4.3.4 Threat of Substitute Products

      5. 4.3.5 Intensity of Competitive Rivalry


    1. 5.1 Product Type

      1. 5.1.1 Pods

      2. 5.1.2 Capsules

    2. 5.2 Distribution Channel

      1. 5.2.1 On-trade

      2. 5.2.2 Off-trade

        1. Supermarkets/Hypermarkets

        2. Specialty Stores

        3. Online Retail

        4. Other Distribution Channels

    3. 5.3 Geography

      1. 5.3.1 Germany

      2. 5.3.2 United Kingdom

      3. 5.3.3 France

      4. 5.3.4 Russia

      5. 5.3.5 Spain

      6. 5.3.6 Italy

      7. 5.3.7 Switzerland

      8. 5.3.8 Netherlands

      9. 5.3.9 Rest of Europe


    1. 6.1 Most Active Companies

    2. 6.2 Most Adopted Strategies

    3. 6.3 Market Share Analysis

    4. 6.4 Company Profiles

      1. 6.4.1 Nestle SA

      2. 6.4.2 Starbucks Corporation

      3. 6.4.3 Luigi Lavazza SpA

      4. 6.4.4 Coind Group

      5. 6.4.5 JAB Holding Company

      6. 6.4.6 Blue Goose Coffee

      7. 6.4.7 Illycaffe SpA

      8. 6.4.8 The Kraft Heinz Company

      9. 6.4.9 Halo Coffee

      10. 6.4.10 Capsul'in

    5. *List Not Exhaustive


**Subject to Availability
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Frequently Asked Questions

The Europe Coffee Pods and Capsules Market market is studied from 2016 - 2027.

The Europe Coffee Pods and Capsules Market is growing at a CAGR of 6.8% over the next 5 years.

Nestle S.A., Starbucks Corporation, Coind Group, Luigi Lavazza SpA, JAB Holding Company are the major companies operating in Europe Coffee Pods and Capsules Market.

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