Published in Marketing
Ready-to-drink iced coffee growth in Europe
Europe has seen robust growth in the niche iced/ready-to-drink coffee market during the last few years, despite many other FMCG categories suffering across Europe.

Though the iced/ready-to-drink coffee is still only a niche category in the overall soft drinks market, it has seen impressive growth lately. In the final quarter of 2013, both West Europe and East Europe saw growth rates of between 9-10%.
According to the latest Quarterly Beverage Tracker report from Canadean, the growing consumer interest in this category is being helped by the spread of the coffee shop culture. The growing market for in-home pods and capsules for hot coffee has also had an important effect in stimulating consumer interest in iced/ready-to-drink coffee drinks.
The German market saw the highest growth with an impressive 9% for 2013. Consumer perception has shifted and the product is no longer just perceived as a summer drink. Instead consumers buy more chilled coffee drinks during the winter months causing year round growth. In other markets this new trend is also beginning to emerge as successful marketing campaigns, and the introduction of new flavours, have kept consumers interested. Such introductions of flavours and variants include Darbo, Emmi Vanilla and Starbucks Discovery label.
According to Canadean Analyst, Michael Ramsell, the success is also due to changed consumption habits of the average European. “These products benefit from their compliance with current consumer trends; ‘on the go’ consumption, snacking and above all, convenience.”
Canadean’s distribution research suggests that retail sales (off-premise) is more dominant than selling through the restaurant/café (on-premise). This is due to a greater focus on marketing/promotional activity, as well as a larger product range and availability in the off-premise channel. However, due to the expansion in the number of coffee shops by large coffee chains such as Starbucks, the on-premise channel is predicted to record robust growth in the coming years.
According to Michael Ramsell, the continual success of iced/ready-to-drink coffee is very much in the hands of the producers. If they can keep the product diverse and innovative, consumers are likely to still perceive the product as modern and stylish.
2014 is likely to see more flavour innovation to keep consumers interested as well as an increase in cross over products with energy drinks. As Europe slowly moves out of recession, increasing consumer confidence and the growing ‘on the go’ lifestyle suggest that the future looks bright for this niche market.

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