Cold brew to become high street staple
Two-thirds of industry leaders expect cold brew coffee to become a high street staple within three years, a new report has revealed.
Forty-five percent of industry leaders surveyed for World Coffee Portal Project Iced UK 2019 identified cold brew as the most significant product opportunity in the iced beverage segment, ahead of handmade iced drinks (42%).
It said that while cold brew sales remain a fraction of hot coffee, growing availability across the UK’s three largest café chains Costa Coffee, Starbucks, and Caffè Nero had significantly contributed to cold brew’s broader market penetration. A number of suppliers including Illy have recently launched into the cold brew market.
However, nitro cold brew was perceived to have far less commercial potential, with just 10% of industry leaders forecasting its widespread availability.
The news comes as the report revealed that iced beverage sales grew 14.3% in 2018 to £395m, representing 5.8% of the UK specialist coffee shop segment’s £6.8bn sales revenue.
The UK’s iced beverage segment is expected to build on strong market momentum with sales of £449m forecast for 2019. Allegra estimated over 170 million iced beverages were served in UK cafés every year.
The report also said that the high-profile product launches from Costa Coffee, Lavazza and Union Hand-Roasted Coffee in 2019 demonstrated the growing commercial appeal of ready-to-drink (RTD) coffee in the UK.
However, the report revealed that UK iced beverage sales remained heavily dependent on warm, sunny weather, with sales reaching peak performance in June to August and declining from September. Seasonal consumption remained entrenched among UK consumers, with 66% of those surveyed exclusively purchasing iced beverages during hot weather and just 10% willing to purchase during the winter months. Value perception also presented a challenge for operators, with just 24% of UK consumers surveyed agreeing iced beverages represent good value-for-money.
However, a younger demographic were more likely to purchase iced beverages outside the core June to August sales window, with winter consumption 6% higher than the average across other age ranges.
The report conducted over 50 consultations with coffee shop operators, including over 30 in-depth interviews. There were also over 2,000 consumer interviews conducted.
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