Budget-minded Gen Z shoppers fuel instant coffee boom

Young people looking to save money on their increasingly expensive caffeine habit are turning to a throwback: instant coffee.

Sales of instant coffee have surged in recent years, with spending growing the fastest among Gen Z consumers, according to global market research firms. Those in their teens and twenties - many of whom were not around when instant coffee was widely popular in past decades - have significantly increased their spending on it, favoring convenience and affordability.

A major factor behind this shift is the rising price of coffee at cafes. In many cities worldwide, the cost of a brewed coffee at a café has risen considerably, making instant coffee an appealing alternative. In contrast, a cup of instant coffee prepared at home can cost just a fraction of the price.

Social media platforms such as TikTok and Instagram have also played a key role in driving the trend. Many users share recipes that allow people to recreate popular café-style drinks at home without expensive equipment. For example, one viral video demonstrates how to make a brown sugar shaken espresso using only instant coffee, brown sugar, cinnamon, milk, water, and ice.

The market has also expanded with higher-end instant coffee options, claiming to match or even surpass the quality typically associated with whole bean or ground varieties. Leading coffee manufacturers, including Nestlé (which owns the Nescafé and Starbucks at Home brands) and J.M. Smucker Co. (which owns Folgers and Dunkin’ at-home products), report growth in their instant coffee lines. They attribute this to a growing interest in at-home coffee-making and the popularity of recreating café-style beverages.

Many consumers appreciate the convenience of instant coffee, not only for cost savings but also for its ease of preparation. Marketing consultant Elisabeth Rosario switched to Starbucks instant coffee packs while living in a major city, cutting down on café bills and saving time. Now, she carries instant coffee packets when traveling for work, appreciating their portability and quality.

Industry leaders note that Gen Z and Millennials are particularly drawn to instant coffee because of their enthusiasm for customization and experimentation with new drinks. Instant coffee has also allowed artisanal coffee brands to expand their product offerings, bringing shelf-stable, high-quality options to a broader audience.

Swift Coffee, a private-label manufacturer specializing in freeze-dried coffee, has seen increased demand. The company, based in Lancaster, Pennsylvania, produces instant coffee for specialty brands such as Intelligentsia, Partners Coffee, and Verve Coffee.

“I think we’re at a stage where instant coffee is now accepted by leading specialty coffee companies,” said Nate Kaiser, founder and CEO of Swift Coffee. “If you’re a coffee roaster in 2025, having an instant coffee offering is just part of the menu.”

With affordability, convenience, and evolving quality improvements driving the trend, instant coffee appears to be solidifying its place among a new generation of coffee enthusiasts worldwide.

- with inputs from Bloomberg