From morning routine to afternoon pick-me-up, coffee has always been a beverage staple. Now, as Americans juggle an onslaught of COVID-related stresses— like heightened family responsibilities and economic uncertainty, to name a few— coffee trends suggest that our favorite caffeinated beverage seems to have taken on an even larger role.
As the numbers of Americans working from home has increased, regular trips to local cafes have become less frequent; instead, coffee trends indicate that consumers are now getting their coffee fix in the form of Ready-To-Drink (RTD) varieties.
According to a 2018 report by Zenith Global, RTD coffee experienced a steady growth rate above that of soft drinks in recent years; in fact, RTD coffee consumption is expected to reach around 6.6bn liters at the end of 2022, thanks to a CAGR of 3.8 percent. Here are the biggest coffee trends fueling the RTD sector right now:
1. Cold Brew
Believe it or not, “cold brew” refers to the process of creating the coffee drink, not its temperature. Technically, it can be served hot or iced, though cold seems to be the preference. To make the drink, coarsely ground coffee is steeped in water for 12 to 24 hours. This heat-free process mutes the drink’s perceived acidity and results in a profile that is smoother and sweeter than a traditional coffee. It also extracts more caffeine, creating a comparably stronger drink.
It’s not that cold brew is overly complicated to make; it just takes time. It also isn’t new.
Before Starbucks added the drink to its US menu in March 2015, the craft sector had already paved the way for the drink with a variety of artisanal, RTD products. But since then, cold brew has seen rapid, widespread adoption. Naturally, increased competition in the category has fueled innovation, much to the delight of coffee lovers everywhere.
Growth opportunities for cold brew span beyond the specialty and premium RTD sectors – and not just in the US. According to a recent report by Grand View Research, the global cold brew market size is on track to reach $1.63 billion by 2025, registering a compound annual growth rate (CAGR) of 25.1%.
New flavors, functional ingredients, and formulations that utilize nitrogen infusions and plant-based milks to enhance the smooth, velvety texture of cold brew will also provide new pathways of opportunity as this category continues to develop.
2. Hard Coffee
You’ve enjoyed hard teas and hard lemonades— why not throw in a hard coffee, too? Spiked coffee is surging in popularity as consumers continue gravitating away from traditional beverage alcohol offers.
According to data from insights firm Nielsen CGA, which was shared in recent coverage by Beverage Industry, hard coffee sales totaled $18.9 million in the 52-week period ending July 18. That figure represents a staggering 11,000 percent growth compared to the same period last year— and it’s not difficult to see why.
In 2019, two notable companies entered the growing niche with the launch of Pabst Hard Coffee by Pabst Blue Ribbon and Hard Cold Brew Coffee by La Colombe. Other brands have since followed suit with great success.
Rebel combines cream, malt, natural flavors, and Arabica coffee to create its three flavors (Mocha Hard Latte, Hard Cold Brew, and Vanilla Hard Latte), plus its seasonal Hard Pumpkin Spice Latte. Another brand, Bomani, offers a 5.7 percent ABV Cold Buzz that was described by Beverage Daily for “marrying two of the fastest growing subcategories in the beverage industry: cold brew coffee and sugar fermented alcohol (the same alcohol found in many hard seltzers).”
Hard coffee is expected to continue this trajectory, especially as consumers continue opting to drink at home in the midst of an ongoing global pandemic.
3. Carbonated Coffee
It goes by many names— sparkling coffee, coffee seltzer, espresso tonic, carbonated cold brew, iced coffee soda. Whatever you choose to call it, carbonated coffee provides a refreshing energy boost that provides an alternative to sugary energy drinks or soft drinks.
Serving a growing consumer demand for “functional plus” beverages, carbonated coffee is being blended with plant-based waters— like coconut and maple— which add additional nutritional and hydration benefits to the existing draw of caffeine.
Vivic Sparkling Coffee is a RTD beverage made with direct trade coffee beans from El Salvador, naturally sweetened with licorice root, and lightly carbonated. Another brand, Olas Coffee, steeps single-origin green coffee, combined with fermented cane sugar and live bacteria and yeast cultures to create a natural sparkle— think kombucha, but in coffee form. Even beverage giants like Coca-Cola and PepsiCo are getting ahead of the “coffee-cola” trend, slated to launch their own lines in 2021.
As the category continues to evolve, we’re sure to see more variety in the form of new flavors and alcoholic versions of carbonated coffee drinks.
And while they didn’t necessarily make our top three, there are plenty of other coffee trends worth noting, including increased demand for sustainably grown and responsibly sourced beans; the rise of subscription and delivery services; whipped coffee; functional, low-calorie and lactose-free options, and high-end decaf. Of course, traditional seasonal flavors (think pumpkin spice and peppermint) will be a natural next step for existing brands as we enter the fall and winter months.
Have a great idea for the next RTD coffee? The beverage development experts at Flavorman can help you bring it to life! Just fill out this web form or give us a call at (502) 453-0152 to get started.