Don't worry, if you're reaching for instant coffee at the grocery store you're still drinking coffee! However, there are some differences between instant coffee and actual coffee.
How it gets made
Instant coffee comes from coffee beans. To make instant coffee, companies take (usually low quality) Robusta beans and grind them very fine - almost to a powder type form. After brewing, all of the water gets removed from the coffee through dehydration. Once you remove the water from the coffee, you have crystalized coffee powder left over. This is similar to how a lot of dehydrated foods exist for backpacking meals. Another way coffee companies can make instant is by spraying brewed coffee through very dry air. Once the droplets land, they are in powder form.
What is the difference between instant coffee and regular coffee then?
So although both are actual coffee, the taste is going to be really different. Because it is a powder, instant has much less oil than regular does. You simply need those oils to have a richer bodied cup of coffee. That's why sometimes, instant tastes super watery. It's because there's no oil in it. Unfortunately, it also has less flavor because flavors go away during the manufacturing process. When you dehydrate a product, you simply take away some of the flavors that are in the water of the coffee.
Another big difference is the caffeine. Robusta coffee accounts for most of instant coffee production. Since Robusta coffee is so much stronger than Arabica coffee, it will definitely get you more wired than most other kinds of brews.
It also will not taste as fresh as ground coffee either. Technically, since instant is already ground and brewed, you don't get the fragrant aromas that you would with freshly brewed coffee. For these reasons, if you can, try to use instant coffee for baking recipes and foods that infuse coffee. The strong caffeine will come through better in the food than drinking it straight.
There's specialty instant and it's changing the world
Specialty coffee roasters are starting to get into the game, and it turns out they taste awesome. Specialty instant is only changing a couple of things to make high quality instant powders, tea bags, and more for drinkers. Unfortunately, these are not as big in grocery stores at the moment. You have to order them online or find them in specialized markets. However, if you think ahead and want something quick and convenient, it's totally worth it.
Generally, these companies follow the above mentioned ways to produce their products. However, there are some nuances that they keep to themselves. Some major differences though, is that they use Arabica coffee instead of Robusta. Also, they work much harder to source just the right coffee for instant. This requires doing a lot of tests between coffees. They will try to brew one as a regular coffee then compare it as an instant to decide if its flavor profile works for the style.
Some companies I like that make instant coffee are called Voila, Sudden Coffee, and Steeped. These companies work with a lot of micro roasters too. So, you get to support independent coffee when you buy from them!