specialty coffee trends - midwest dairy
TRANSCRIPT
Ready to Drink Coffee
Trends & Dairy
RTD Coffee Shows Opportunity for Growth in
the U.S.
2Source: Euromonitor 2017
24%
18%
8%
4%
22%
16%
7%
2%
Bottled Water Juice
Energy Drinks Sports Drinks
Non-Cola Carbonates Cola Carbonates
RTD Tea RTD Coffee
U.S. Soft Drink Share of Dollar Sales
in 2017
41%
4%12%
5%
18%
0%13%
7%
Bottled Water Juice
Energy Drinks Sports Drinks
Non-Cola Carbonates Cola Carbonates
RTD Tea RTD Coffee
U.S. Soft Drink Share of Dollar Sales
in 2017-2022
RTD Coffee RTD Coffee
From 2013 to 2017, R.-T.-D. coffee sales grew
about 10% annually in the United States
3Source: Mintel 2017; Food Business News
Much of the growth came from some type of cold brew, with cold-brew retail sales
reaching an estimated $38 million in 2017, representing a single-year growth of 137%.
Chilled / Iced Coffee is Taking a Leading Place
in the Strategy of More Companies,
Particularly RTD Coffees
4
La Colombe RTD coffees
are made with lactose-free
milk and cold-pressed
espresso. It’s now a $30
million brand in the U.S.
Bigger players like Nestle
are also investing in the
format.
Source: New Nutrition Business 2018, 10 Key Trends for 2019
The Trend is Likely to Continue; Young
Consumers Are Leading the Shift from Hot
to Chilled RTD Coffee
5
68%Of U.S. 18-34-year-olds
currently consume single-serve
RTD coffee (in bottles or cans).
Source: New Nutrition Business 2018, 10 Key Trends for 2019
43%Of total U.S. adults currently
consume single-serve RTD
coffee (in bottles or cans).
Compared to
Around 90% of the RTD Coffee Space is Made up of
RTD Coffee with Dairy Milk
6
Top Ingredients: Purified water,
organic Colombian coffee, organic
maple syrup, Sunnova super
creamer (milk protein isolate,
purified coconut oil (mct)
Top Ingredients: Organic
coffee concentrate (water,
coffee), butter, whey protein
concentrate
Top Ingredients: Starbucks
coffee (water, coffee),
reduced fat milk, skimmed
milk, sugar
Source: Innova Database; January 2013 – December 2017; Global market; Iced
Coffee; Specialty Coffee flavor list; contains milk
RTD Coffee with Milk is also the Most Common
Choice for Consumers – Based on Sales
7 Source: IRI ILD POS data ending 2/25/18 MULO+C IRI Consulting Analysis
U.S. Adults are Drinking More Specialty Coffee
8Source: National Coffee Association; 2017 U.S. Specialty Coffee Consumption Trends
0%
10%
20%
30%
40%
50%
60%
70%
80%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Percentage of Adults in the U.S. Drinking Specialty Coffee (2008-2017)
67%
53%
41%
18%
31%
60% OCCASSIONALY
WEEKLY
DAILY
Within the 69% of RTD Coffee NPL’s that are Specialty Coffees,
Lattes are the Most Common Specialty Coffee Type
9Source: Innova Database; January 2014 – December 2018; global market; iced
coffee; RTD packaging; specialty coffee flavor list; contains milk
2014 - 2018 Specialty Coffee Types
Mocha Latte1%
Latte32%
"Frappuccino"7%
Cappuccino17%
Mocha 15%
Espresso14%
Macchiato17%
Join in on the Better-For-You Health Trend
Strategies to Handle the Demonization of Sugar
10
• Explore different ways to reduce sugar.
• Consumer acceptability varies according to target market and consumer group.
Source: New Nutrition Business 2018; 10 Key Trends in 2019
Reduce
the Sugar
Make it
Natural
Pure
IndulgenceSugar for
Energy
• Many consumers believe that if something is natural, it is healthier.
• Honey, agave and stevia are popular “white sugar replacements” on social media.
• If you market something as an honest, permissible indulgence, consumers will be more forgiving about the sugar content.
• Consumers
looking for
“natural energy”
are forgiving
about the sugar
content.
Better-For-You Health Trend: Reduce the Sugar
11 Source: GlobalData Q4 2016 Global Consumer Survey; Innova NPD Nov. 2017
U.S.; New Nutrition Business 2018 10 Key Trends for 2019
Global: consumers who find the following food and
drink product claims appealing or very appealing, 2016
71% 71%
Low sugar No Added Sugar“I pay attention to how much
sugar I consume for a
variety of reasons. It’s bad
for my teeth and for my
waistline. But also because
it’s always going around
how addicted we all are to it
apparently.”
American, curator, 28
(female)
Coffee Formulations are Moving Towards Low-Sugar
or Sugar-Free Options
12Source: GlobalData Q4 2016 Global Consumer Survey; Innova NPD Nov. 2017 U.S.
Global: “I somewhat agree/ agree with this statement”, 2016
Sugar has a negative impact
on my health.
I perceive hot drinks as having
high/medium sugar content.
I am actively trying to reduce
my consumption of sugar.
Unsweetened products taste
better than sweetened version.
63%
81%
87%
33%
Dairy Super Consumers Present
Opportunity to Increase Retail SalesStage 1 of IDDBA’s Super consumer research (2017) results indicate
that 20% of households are potential Super Consumers.
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• Spend 2.2 more ($634/year)
• Purchase 7 subcategories
• Shop at 5 different stores.
Source: IDDBA 2019 What’s in Store
10% 22%
DAIRY SUPER CONSUMERS
Appeal to Shoppers Already in Your
Store – up to $2.4-$3B Opportunity.
14
Source: IDDBA 2019 What’s in Store
Create a coffee creamer bar in your store so customers can sip
and shop. Refine creamer bar options to make experimenting with
new flavors fun and easy.