Australia’s café scene is experiencing a generational shift as Gen Z consumers redefine what it means to grab a coffee, according to new research from Milklab.
The Milklab Gen Z Survey 2025 found that while lattes and cappuccinos remain café staples overall, younger consumers are gravitating toward Instagram-worthy alternatives.
Among 18-24-year-olds, 40% have ordered matcha in the past six months, and 36% have ordered flavoured iced matcha. Notably, a third of Gen Z respondents say matcha is their favourite beverage, compared to just 15% who prefer flat whites.
This preference shift extends beyond the menu. For Gen Z café-goers, aesthetics matter nearly as much as taste, with 46% motivated to photograph or video their drinks based on appearance. When choosing new beverages, 30% cite taste as their primary motivation, followed closely by novelty of flavours at 29% and drink aesthetics at 26%.
The trend is also driving operational changes in Australian cafés. Plant-based milk options are commanding premium menu board placement, with 58% of Gen Z consumers reporting that milk brand influences their café choice. Almond milk leads at 30%, followed by oat milk at 26%.
Beverage options driving foot traffic
Beyond beverages, Gen Z is transforming the café experience itself. A majority (61%) meet friends at cafés at least once a week, with a third citing ‘the vibe’ as a key draw. This has fueled the emergence of concepts like Milklab Coffee Shop Sets, which pair speciality hot and iced drinks with morning DJ performances.
“It’s no longer about sipping hot lattes and cappuccinos for an early morning kick start to the day,” said Natalie Latimore, Milklab’s Head of Marketing. “We’re seeing iced coffees and signature drinks take pride of place on café menu boards as the beverage options that are driving foot traffic into cafés—for consumption both morning and afternoon.”
The survey also revealed Gen Z’s priorities: when asked what they’d rather have for life, 32% chose free coffee and 31% chose free wifii, outpacing free phone upgrades (24%) and streaming subscriptions (13%).
Milklab, which celebrates its 10th anniversary this year, has capitalised on these trends. The brand’s oat milk has proven particularly popular with younger consumers due to its pairing with matcha. Milklab sells six cups of its milk products every second and experienced 28% revenue growth in the past year, with its almond and oat varieties ranking as the top two barista milks in Australian cafés.
The company’s products are now available in more than 12,000 cafés for its almond milk and over 8,000 cafés for its oat milk, reflecting the broader shift in Australian café culture driven by changing consumer preferences.
