“Studies suggest that an average coffee drinker’s consumption of coffee increases with age, from age 10 through 60. Even after age 60, coffee consumption remains high. The average cola drinker’s consumption of cola, however, declines with increasing age. Both of these trends have remained stable for the past 40 years. Given that the number of older adults will significantly increase as the population over the next 20 years, it follows that the demand for coffee will increase and the demand for cola will decrease during this period. We should, therefore, consider transferring our investments from Cola Loca to Earl Bird Coffee"
The argument above assumes that the current trend of the coffee consumption of a coffee drinker going up with his/her age will hold true in future. Despite the stable trend of the past 40 years and the famous saying “History repeats itself”, many surveys and research have proved that history may or may not repeat itself when it comes to predicting anything about consumers. The very simple reason for this might be that it is impossible to predict consumer behavior, for one consumers and their likes/dislikes keep changing all the time and they may or may not react the same way every time.
A good example of this behavior would be ‘parallel fitting’ pants that were introduced in India by Fashion companies back in the nineties, which was in response to the popularity of a movie star’s ‘parallel-fitting’ pants in a move that was a box-office hit. The consumers bought these pants like crazy for a year or so and after that, they went completely out of fashion and all the fashion companies ended up with a huge inventory worth hundreds of thousands of dollars.
It would take as few as one research finding to strengthen the above argument though; the finding that would state that coffee is good for human health in terms of things such as increase in life span, improvement in body’s defense mechanism, etc., would definitely maintain, if not improve, the current trend.
In the same context though, all it would take to disprove the current trend is one research finding stating that coffee negatively affects human health.
If one decides to assume that the current trend would continue in future and take the risk to invest in Early Bird Coffee, he/she should definitely do some homework and evaluate why the current trend is the way it is. He/she should also try to understand why cola consumption decreases with age in humans. He/she should keep an eye on where the consumer tastes are going as far types of coffee or decaffeinated coffee, etc. In the end, if the investor manages to convince himself the investing in the coffee industry is the way to go, he/she should definitely research on the best coffee company to invest in so that his investment will grow and give him/her healthy returns.
The argument above assumes that the current trend of the coffee consumption of a coffee drinker going up with his/her age will hold true in future. Despite the stable trend of the past 40 years and the famous saying “History repeats itself”, many surveys and research have proved that history may or may not repeat itself when it comes to predicting anything about consumers. The very simple reason for this might be that it is impossible to predict consumer behavior, for one consumers and their likes/dislikes keep changing all the time and they may or may not react the same way every time.
A good example of this behavior would be ‘parallel fitting’ pants that were introduced in India by Fashion companies back in the nineties, which was in response to the popularity of a movie star’s ‘parallel-fitting’ pants in a move that was a box-office hit. The consumers bought these pants like crazy for a year or so and after that, they went completely out of fashion and all the fashion companies ended up with a huge inventory worth hundreds of thousands of dollars.
It would take as few as one research finding to strengthen the above argument though; the finding that would state that coffee is good for human health in terms of things such as increase in life span, improvement in body’s defense mechanism, etc., would definitely maintain, if not improve, the current trend.
In the same context though, all it would take to disprove the current trend is one research finding stating that coffee negatively affects human health.
If one decides to assume that the current trend would continue in future and take the risk to invest in Early Bird Coffee, he/she should definitely do some homework and evaluate why the current trend is the way it is. He/she should also try to understand why cola consumption decreases with age in humans. He/she should keep an eye on where the consumer tastes are going as far types of coffee or decaffeinated coffee, etc. In the end, if the investor manages to convince himself the investing in the coffee industry is the way to go, he/she should definitely research on the best coffee company to invest in so that his investment will grow and give him/her healthy returns.
