Thursday, August 10, 2017

(Cold) Brew Up Your Dairy Beverage Portfolio

Photo source: Starbucks

Ready-to-drink, dairy-based, cold-brew coffee, tea and cocoa beverages have the power to grow sales in the refrigerated dairy case as consumers increasingly embrace minimal processing and the fresh perimeter of the supermarket. The fact is, cold brew has changed the coffeehouse landscape. This trend is powerful enough to make an impact on retail fluid milk sales if dairy processors are willing to invest in adding a line extension or two.

While I very much appreciate unique packaging, enticing brands and millennial-centric marketing, cold-brew offerings—for fluid milk processors--might be best as a line extension in their flavored milk line up, right there with the chocolate, strawberry and maybe other flavors, in pint and half-gallon paperboard cartons or plastic jugs.

Crazy, right? Or maybe not. Think about it. Retail flavored milk sales are up. Milk users are shopping the flavored milk dairy case. Make the latest flavor trend readily available to them, in a customary format.

Any coffee, tea or cocoa expert knows this: if it’s quality product, it does not need sweetener (with cocoa, just a little). Hence, as consumers make an effort to reduce added sugar intake, they will seek out premium products with no or less added sugar. The cold-brewing process, which works on coffee and cocoa beans and teas leaves, makes this possible.

Cold brew, also known as cold press, is beans or leaves brewed without heat. Cold brewing requires steeping in ambient- to cold-temperature water for a long period of time. The type of beans and leaves, the ratio of beans and leaves to water, the temperature of the water and the steeping time all impact the final product.

This is getting noticed and embraced by consumers.

Market penetration for cold-brew coffee rose to 21% in 2017 among those drinking coffee daily in the U.S., up from 15% in 2015, according the New York-based National Coffee Association. Data is not available for cold-brew tea or cocoa yet, but beverage analysts are projecting the two will be “hot” spots in 2018.

The key takeaways are:

1. Don’t let packaging prevent you from getting into cold-brew, milk-based coffee, tea and cocoa beverages. Offer them alongside chocolate milk.

2. Keep added sugars low, and avoid if possible. Communicate this on the package. Quality cold brew tastes great without sweetener.

3. Offer a seasonal/limited-edition flavor to entice shoppers to try. It’s not too late to make your debut with a cinnamon spice winter offering. It works in coffee, tea and cocoa.

4. Embrace a fruity, milk infusion. Cold-brew coffee, dairy and coconut is a great combo. Cold-brew tea, dairy and berries works, too. Cold-brew cocoa, dairy and almost any layer of flavor makes for an amazing beverage. Think limited-edition offering to create excitement in the category and encourage purchase.

5. With value-added beverages, single-serve, eye-catching packaging is paramount. Co-packers can assist. (Link HERE for co-packing assistance.) There is a real opportunity to take a functional foods positioning with cold-brew, dairy-based beverages. I’ve recently become aware of some functional cold-brew coffee-milk beverages that will soon enter the marketplace. In the near future, they will be featured as a Daily Dose of Dairy. There’s a probiotic drink, an energy beverage and a meal replacement.

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