Innovation In Ready To Drink Tea And Coffee Market Leading To New Business Opportunities

Posted On December 11, 2020     

The global pandemic enforced a move in consumer priorities, and the coffee and tea industry is feeling the impact. A steep decline in away-from-home coffee and tea consumption has led to stunted consumption overall.

Clean energy and functional ingredients

Pre-pandemic, customers were looking for healthier coffee. Stimulating coffee with functional ingredients has been a novelty focus for several years, and the world health calamity has accelerated growth. Coffee can be a perfect delivery vehicle for added vitamins or other nutrients, as its strong flavor helps to mask their taste.

Many consumers who are health conscious are adding their own functional ingredients to traditional coffee. There is a significant rise of 26% year over year (YoY) observed in the Social media conversations that mention “coffee” paired with “whey.” Social media shows pairing “whey protein” and “coffee” are up 32% YoY.

Consumers look to coffee as a beverage that provides a source of “clean energy.” RTDs that give great-tasting products “free-from” labels—like soy-free, GMO-free, or no artificial will stand out from other offerings. The popularity of “free-from” food items indicates consumers perceive healthiness as much by the absence of ingredients as the addition of ingredients with functional benefits.

RTD products adapt to survive

Sales of ready to drink coffee and tea have climbed in current years, but these products nature depends heavily on away-from-home consumption. These brands have been hit hard as RTD consumers in quarantine search for less costly, multi-services alternatives. As lockdowns ease, many people are still spending more time at home to care for their finances and health. Multiserve packaging, bag-in-box, and cold brew concentrates are all packaging options that will promote in-home consumption.

Premiumization and indulgence

Budget is a rising concern for many coffee drinkers, but brands must target the conflicting end of the value spectrum. Indulgent coffee may be considered as comfort food to consumers who are facing stressful lives. Pre minimization is essential as consumers try to find small treats to lighten anxiety and stress. Brands can fulfill the demand for indulgent treats by giving innovative flavors and recipes intended to lift up the in-home coffee experience.
Innovation and convenience.

Coffee brands can innovate around convenience and more use occasions. Convenience is one of the deciding determinants in buying decisions, so packaging needs to be attractive and innovative, particularly for RTD products. Portion-control packs or portable packaging designs may appeal to consumers on the go.
 
Today’s tea and the coffee market have a lot of opportunity with the presence of numerous small and big competitors. To strengthen their positions globally, aligning with consumer needs and values is critical for success. Companies that can innovate, meet up growing consumer expectations, and become perpendicularly integrated perform well.

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