This is seen not only in the relatively well-established USA market, which is number two in size globally after Japan, but also perhaps more interestingly in Europe, led by initiatives from multinational beverage and dairy companies.
The market remains relatively limited in terms of soft drinks as a whole, however, as does the level of new product activity. According to Innova Market Insights, iced coffee accounted for just 3.5% of total soft drink product launches recorded in the 12 months to the end of September 2011. This was up from 2.7% five years previously. Activity also remained relatively low when compared with launch numbers of traditional hot coffee products and indeed iced tea launches, both of which saw twice the launch numbers over the same period.
As might be expected, Asia continues to dominate launch activity in iced coffee in line with its domination of the global market. The Asian region accounted for nearly three-quarters of total iced coffee launches recorded on the Innova Database (www.innovadatabase.com) over the year to the end of September 2011, while Europe had a more modest 16% and the USA closer to 5%.
The USA market continues to be dominated by Starbucks Frappuccino, jointly developed by Starbucks and PepsiCo, ahead of another Starbucks brand Doubleshot. Both of these are now being made available in a range of other countries, including parts of Europe. In the UK, for example, Arla Foods teamed up with Starbucks to introduce the Frappuccino range to the retail grocery market in 2011, packaged in single-serve glass bottles and featuring fairtrade certification. Illycaffe’s Issimo canned coffee drinks range, launched in the USA and Greece in 2009 and now available in 17 countries, was also introduced in the UK in 2011 in Caffe, Cappuccino and Latte Macchiato variants.
Germany probably has the largest iced coffee market in Europe overall, although it trails much smaller neighbour Austria in per capita terms. It has been seeing considerable new product activity in recent years, particularly with milk-based coffee drinks in lidded cups. There has been rising interest in the chilled market in recent years, changing the traditional focus on ambient lines. Swiss dairy company Emmi has been a leader in this area with its Caffe Latte range. Germany is one of its key markets, with the range also available in other European markets and in the USA. The range, sold in characteristic cardboard cups with snap-on-lids, now encompasses a range of flavour variants. It has been extended further in 2011 with an Extra Shot extra-strong espresso-style variant sold in smaller 150 ml cups.
A review of recent activity recorded on the Innova Database reveals that other interesting innovations in the sector in 2011 have included Café Pret a Boire from Lutin Malin in France, claimed to be the first RTD coffee that can be drunk hot, cold or iced; Unilever’s Café Zero range in Spain made up of a frozen blend of coffee and ice cream; Health is Wealth Nutriccino vitamin- and mineral-fortified bottled coffee drinks in the USA and Bauer’s Caffe Crema Freddo in Germany, with fairtrade certification.
According to Lu Ann Williams, Head of Research at Innova Market Insights, the demand for iced coffee drinks of all kinds now appears to be developing, not only geographically, but also beyond its original home in the foodservice sector of many countries, particularly the USA. With the growth of the market and the need to compete with alternative beverages, more traditional coffee variants in the RTD sector have been joined by a whole range of increasingly sophisticated flavour choices, as well as light options. At the same time, further value has been added with the use of organic and/or fairtrade coffees, as well as coffees of specified type and origin, and the introduction of more user-friendly and convenient packaging formats, including cartons, bottles and lidded cups.
For further information on the Innova Database, the representative for Australia and New Zealand is Glen Wells ([email protected]).
