Diana Kelter
Diana is a Senior Trend Analyst at Mintel. She investigates how cultural, lifestyle and technology shifts take shape across sectors and leverages Mintel data across trend observations.

Baby Boomers and the World War II/Swing Generation still find comfort and routine in a basic hot cup of coffee, with both generations being the most likely to consume hot coffee at home and away, according to Mintel’s July 2016 Coffee and Tea Tracker. However, coffee drinking habits are not as straightforward when looking at Millennials and iGens who have grown up with a variety of coffee offerings that continue to evolve with nitro brewing techniques.

Millennials’ preferences towards elevated beverages are not limited to coffee, and can be seen with soda, juice and alcohol. More restaurants, bars and coffee houses are merging together to offer consumers the best of both worlds. Recently, Chicago has seen two new concepts open that serve as both a bar and coffee shop with snackable food offerings. Ipsento Coffee, which already has one core coffee house in Chicago, opened another location that also serves alcohol. The coffee chain specializes in nitro coffee offerings and lattes during the day and at night transforms into a full bar with six house cocktails and a list of draft beer options. Ipsento even partnered with Hopewell, a local Chicago brewery, to feature their coffee in a craft beer option.

Along the same lines, another Chicago cocktail bar, Estereo, is serving Latin American inspired alcoholic beverages at night, and coffee during the day. They infused coffee into one of their cocktail offerings, which includes a coconut-date horchata.

Chicago is not the only city blending coffee and cocktails, however. A few New York bars are also incorporating coffee into their cocktail menus. Kobrick Coffee Company is serving cocktails, coffee and food all day. They feature unique takes on cold brew coffee, such as their Koco Freddo, which blends cold brew coffee with coconut oil and egg white. Their cocktail list also includes a variety of flavors and coffee blends. The Loca Mocha cocktail includes ancho chile liqueur, Jameson Irish whiskey, chocolate milk, cold brew and aromatic bitters.

What we think

As both the coffee and alcohol segment become more elevated with craft beverages and flavor innovation, it was only a matter of time before they found themselves on a shared menu. Coffee shops have always struggled to maintain a late-night audience, and Starbucks took on this challenge through their late-night menu offerings. This late-night concept is now further expanding with major cities noticing the emergence of elevated cocktail and coffee houses that serve as a joint offering for both day and night.

While coffee shops and bars were once polar opposites, they have found common ground through shared techniques and artisan preparation methods. These emerging coffee shop and bar concepts currently appeal to the Millennial generation and urban environments, but the trend could see larger momentum down the road. As more offices become flexible with remote work locations, employees could find value from being at one location that serves as a coffee shop to work from during the morning and afternoon hours and transforms as a place to catch up with coworkers and friends in the evening.

Diana Kelter is a Foodservice Analyst at Mintel, specializing in Mintel Menu Insights. In her role, Diana takes a full-circle approach to foodservice trends by looking at various influences impacting restaurant menus.