Coffee in the UK isn’t just about grabbing a cappuccino on the way to work anymore—it’s become part of lifestyle, identity, and even community.
And while smaller independent cafés and sleek new chains are thriving, Costa Coffee—the once-reliable giant of the high street—is struggling to keep up.
Experts now suggest that Costa’s predictable look and feel, once its strength, has turned into a weakness.
Customers are chasing something fresher, more personal, and more exciting than what the nation’s biggest coffee chain is offering.
Costa’s Stumble Under Coca-Cola
Costa, bought by Coca-Cola in 2018 for £3.9 billion, has not lived up to expectations.
Despite posting revenues of £1.22 billion in 2023 (a modest rise from the previous year), the brand still hasn’t reached its 2018 peak of £1.3 billion.
Coca-Cola’s CEO James Quincey even admitted recently that Costa was “not quite where they wanted it to be from an investment point of view.”
Worse still, sales of coffee dropped three percent, and the company’s “food-to-go” range also underperformed.
Even with more than £250 million in dividends flowing to Coca-Cola over seven years, the investment looks shaky.
Why Customers Are Walking Away
Marketing strategists argue the issue isn’t that Brits stopped drinking coffee—it’s that Costa’s experience has become forgettable.
Walk into any branch, critics say, and you’ll find copy-and-paste décor, a predictable menu, and little warmth or personality.
What used to feel familiar now feels bland.
Creative strategist Calvin Innes put it bluntly: Costa has turned into the “McDonald’s of coffee.”
Younger customers, especially Gen Z and millennials, want coffee shops with soul—places that feel crafted, community-driven, and authentic.
Independents and trendy chains like Grind, Gail’s, and Black Sheep Coffee are stepping in to offer exactly that.
Slipping Standards and Changing Palates
Other industry voices say Costa has simply let things slide.
Dominic Goldman, a branding expert, described how stores feel “grubby and dim” and how the coffee itself can taste rough or burnt.
Where customers once felt like they were treating themselves, many now see Costa as a compromise.
He added that today’s coffee lovers expect more: high-quality beans, smooth textures, stylish environments, and even curated playlists that make cafés feel like destinations.
By comparison, Costa’s offerings feel dated.
Competitors That Moved Faster
Costa’s rivals have leaned into identity.
Starbucks sold a lifestyle, Pret pushed convenience, and independent cafés doubled down on craft and creativity.
Costa, however, has been stuck in the middle—convenient, yes, but without much emotional pull.
Industry analyst Julia Payne explained that coffee shop choices are often emotional, not just practical.
People want spaces that feel connected, relevant, and community-driven.
Costa’s purely functional feel has left it looking corporate and impersonal.
The Bigger Picture in Coffee Culture
The coffee market itself has shifted dramatically.
Consumers now care about sustainability, sourcing, and storytelling behind their cup of coffee.
That’s why new players like Blank Street or Qima Café are growing fast—they promise either high-tech efficiency or authentic farm-to-cup values.
As one expert put it: “Scale is no longer enough.”
Coca-Cola’s bet on Costa hasn’t paid off because the brand sits awkwardly between convenience and authenticity, offering neither strongly.
Independent Shops Are Thriving
Walk down any high street in cities like Bath or London, and independent coffee shops are everywhere.
Each one offers something unique—whether it’s artisan roasting, quirky interiors, or specialty drinks—and customers are willing to pay more for the experience.
This growing “coffee culture” has turned what used to be a hipster niche into the mainstream.
Specialty coffee has gone global, with brands like WatchHouse expanding to the U.S. and Black Sheep Coffee securing major investment.
Financial Pressure Adds to the Strain
On top of brand fatigue, rising costs are squeezing Costa.
Coffee bean prices are at 50-year highs, inflation is hitting operating expenses, and the cost-of-living crisis means fewer people are treating themselves to daily lattes.
Costa even drew criticism for raising prices on its Express machines, including in hospitals, where customers accused the chain of exploiting vulnerable people.
Meanwhile, with more people working from home, Costa’s heavy reliance on high-street real estate has become a burden.
Competitors Riding the Wave
Not everyone is struggling. Pret a Manger reported sales up 10 percent in 2024, and Caffè Nero has seen a sharp increase too. Specialty chains like Knoops and Qima are also booming. Starbucks, however, is facing its own UK decline after boycotts related to the Israel-Palestine conflict led to heavy losses in 2024.
What’s Next for Costa?
For now, Coca-Cola hasn’t confirmed what it plans to do with Costa, but experts are hinting that a “cut-price” sale could be on the table.
One thing is certain: unless the brand finds a way to reinvent itself with personality, quality, and relevance, Costa risks becoming a relic in a coffee market that has moved on without it.