Market Overview

The global coffee pods and capsules market size reached USD 29.6 Billion in 2024 and is projected to grow to USD 53.3 Billion by 2033, exhibiting a CAGR of 6.39% during the forecast period of 2025-2033. Growth is driven by increasing consumer demand for convenience, rising disposable incomes, premiumization trends, and expanded coffee consumption in households with diverse flavor options. For detailed market insights, see Coffee Pods and Capsules Market

Study Assumption Years

  • Base Year: 2024
  • Historical Year/Period: 2019-2024
  • Forecast Year/Period: 2025-2033

Coffee Pods and Capsules Market Key Takeaways

  • Current Market Size: USD 29.6 Billion (2024)
  • CAGR: 6.39% (2025-2033)
  • Forecast Period: 2025-2033
  • The market growth is fueled by consumers' fast-paced lifestyles and convenience demand, with 47% of UK homes purchasing pods for convenience.
  • Rising disposable incomes globally are shifting buyers towards premium coffee pod and capsule products including single-origin and limited-edition blends.
  • Increasing home coffee consumption is driving market expansion, with 83% of consumers drinking coffee at home according to the US National Coffee Association.
  • Europe is the largest regional market, supported by a strong coffee culture and developed retail infrastructure.
  • Consumer focus on sustainability is driving innovations in biodegradable and compostable capsules.

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Market Growth Factors

The market is growing due to the ever-increasing need for convenience. In 2018, Tokyo had over 37 million inhabitants, followed by Delhi at 28 million, accentuating fast-paced urban lifestyles worldwide. This has led to a demand for quick coffee preparation solutions like pods and capsules. For instance, 47% of UK households buy coffee pods for convenience, showcasing consumer preference for time-saving products amid busy daily routines.

Rising disposable incomes also contribute significantly to market growth. The EU saw a 14% rise in household disposable income from 2013 to 2021, and India recorded 8% growth in FY24. Growth in organic and premium beverages is notable, with organic coffee expected to reach USD 18.9 billion by 2032 growing at 8.1%. Leading coffee brands have responded with premium capsules featuring single-origin coffees, rare blends, and partnerships such as Nestle and Starbucks launching new capsule ranges in 2020.

Increasing coffee consumption in homes is another key driver. The US National Coffee Association reports a 6% rise in past-day coffee consumption among consumers aged 40-59 since 2020, with 83% drinking coffee at home. UK research shows 57% of consumers drink coffee at home more than three times daily. This trend fuels demand for compatible pods and capsules, exemplified by Tim Hortons' 2022 launch of espresso capsules compatible with Nespresso machines.

Market Segmentation

By Type:

  • Pods
  • Capsules

Capsules represent the majority segment, favored for convenience, consistency, and variety. They offer easy preparation and a wide range of flavors, intensities, and origins which enhance consumer experience. The segment is expanding with offerings of teas and hot chocolates and innovations in biodegradable and recyclable capsules.

By Packaging Material:

  • Conventional Plastic
  • Bioplastics
  • Fabric
  • Others

Conventional plastic is prevalent due to durability and moisture resistance, protecting freshness and providing economical single-serve solutions. Bioplastics gain popularity as sustainable alternatives made from renewable materials like corn starch and sugarcane, appealing to eco-conscious consumers. Fabric packaging, using organic materials like hemp or cotton, offers biodegradability and a unique aesthetic, catering to niche markets emphasizing sustainability.

By Distribution Channel:

  • Supermarkets and Hypermarkets
  • Specialty Stores
  • Online Stores
  • Others

Supermarkets and hypermarkets dominate due to extensive reach, convenience, high foot traffic, and promotional activities. They offer diverse brands under one roof, facilitating product discovery and impulse purchasing, positively impacting market revenue.

Regional Insights

Europe leads the coffee pods and capsules market, driven by a pervasive coffee culture and high consumer demand for convenient coffee options. Advanced retail infrastructure ensures wide availability across supermarkets, hypermarkets, and online channels, facilitating ease of purchase. Presence of established brands and widespread use of coffee machines in homes and offices further support this dominance.

Recent Developments & News

In July 2021, Pret A Manger partnered with JDE Peet's to launch aluminum coffee pods using Pret's 100% organic coffee, compatible with Nespresso, available in over 500 UK Tesco supermarkets and online via Ocado. In November 2022, Nespresso (Nestle S.A.) introduced a new line of compostable single-serve coffee capsules, expanding its offerings in paper-based coffee capsule products.

Key Players

  • Caffè d'Italia Srl
  • Caffè Nero (Nero Holdings Limited)
  • Dualit
  • illycaffè S.p.A
  • Keurig Green Mountain, Inc.
  • Luigi Lavazza SpA
  • Melitta
  • Nestlé Nespresso SA
  • Peet's Coffee
  • Tim Hortons
  • Trilliant Food and Nutrition, LLC

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