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Story perspectives

Costa Coffee Struggles as Gen Z Chooses Matcha Over Tradition

9/1/2025

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Summary

Story summary

Costa Coffee faces challenges from Gen Z and Millennials favoring matcha and specialty drinks.
The lack of innovation in its traditional menu resulted in a £14 million operating loss in 2023.
Smaller competitors, such as Blank Street Coffee, succeed by leveraging social media and unique offerings.
Coca-Cola is contemplating a sale of Costa, potentially valued at £2 billion, due to declining market relevance.

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Story summary

Costa Coffee faces challenges from Gen Z and Millennials favoring matcha and specialty drinks.
The lack of innovation in its traditional menu resulted in a £14 million operating loss in 2023.
Smaller competitors, such as Blank Street Coffee, succeed by leveraging social media and unique offerings.
Coca-Cola is contemplating a sale of Costa, potentially valued at £2 billion, due to declining market relevance.