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August 22, 2014

Kraft Licenses Coffee Brands for use in Green Mountain's Keurig

6a01310fa9a669970c01a511f73ed7970c-800wi 6a01310f54565d970c01a3fce3cf1a970b-800wiWith Jonas Feliciano, Beverages Industry Analyst and Dana LaMendola, Beverages Industry Analyst



The recent deal between Kraft and Green Mountain gives liscensing rights to Green Mountain to distribute Kraft's brand of products in pod form for use in Keurig machines. Kraft's brands are a large gain for Green Mountain, who's main strategy is to obtain liscenses from large coffee players. Kraft's Maxwell House brand is the second largest coffee brand in the US, and given the success of Starbucks and Folger's pods, Kraft's larger-known brands are expected to perform well in pod format.

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August 17, 2014

Tata’s State of Play in Global Coffee and Earth Rules Acquisition

Hope.LeeAnalyst Insight by Hope Lee, Senior Beverages Analyst

Tata Global Beverages Ltd’s (TGBL) global ambitions are clear and well laid out. The company is aggressively acquiring and building a comprehensive beverages portfolio through both the extension of existing core brands and new brand acquisitions. Geographical expansion was also a priority from previous acquisitions. The company aims to achieve revenues of US$5 billion by 2015. This is achievable if it sustains its rapid expansion. TGBL’s long-term corporate goal is to become a major player in tea, coffee and bottled water. While the company is already a leading player in tea globally, it would take many years to replicate that position in coffee if relying solely on organic growth over the medium term. Its recent acquisition of Australian company Earth Rules is a positive move in this direction. Bronski Eleven Pty Ltd Australia was the holding company of Earth Rules Pty Ltd. However, the country’s limited growth potential may have an insignificant impact on TGBL’s global coffee position unless it expands its newly acquired business to other countries.

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August 7, 2014

Lipton: Hot Tea and RTD Tea Major Market Sales

Lipton market share sales

Lipton is the world’s leading hot tea and RTD tea brand, with around US$6 billion rsp in 2013. It is significant in both hot tea and RTD tea and has truly global coverage, helping to secure its overall position. It also has no close rivals in terms of category and geographic profile. Major markets for hot tea and RTD tea are likely to see far higher growth in RTD tea than hot tea in future, meaning Lipton RTD tea has much growth potential. It does need to address its weakness in Indonesia.

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August 2, 2014

Can the Bkon Craft Brewer Steal Customers from the Coffee Pod Market?

There are two major contributing factors to market growth in hot drinks: the growing market for coffee pods and the health and wellness trend existing in the tea market. The recent launch of the Bkon Craft Brewer addresses both of these factors as it can create any loose-leaf tea beverage or coffee blend in a 60-second time frame. Currently the machine carries a hefty price tag and is not feasible for use outside of larger tea houses, but if the creation proves successful and the company manufactures a version intended for home use, it may steal away customers from the coffee pod market.

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July 21, 2014

Shopper Insights in Action Conference 2014 – IIR – Event Recap

Howard TelfordAnalyst Insight by Howard Telford - Beverages Analyst

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This past Wednesday, the 14th annual Shopper Insights in Action conference concluded in Chicago, Illinois. As always, the event focused on strategies to improve shopper activation across all kinds of consumer retail categories and channels, providing the shopper side of consumer marketing (and its research suppliers) an engaging forum to share ideas and success stories.

From a beverages and food service perspective, the three-day event at Navy Pier left me considering the need to address three, macro-level organizational challenges in the drinks industry:

1.       Using ‘big data’ more effectively

As the event’s exhibit hall demonstrated, there are a myriad of methodologically different ways to collect, measure and interpret the in-store responses of consumers to your products and shelves. As an industry that frequently delivers and merchandises its products through a two-tier bottling system (or other independent direct delivery partners), measuring the effectiveness of in-store activity - displays and product location - is vital. How can marketing and channel management teams demonstrate that ‘soft’ information on shopper response, preference or opinion is robust and indicative of volume growth or incremental revenue? Brands and their retail partners must work harder to interpret and contextualise data and insights in order to effectively advocate for change within their businesses.

Research focused and data literate leadership certainly helps. Keynote speaker Sir Terry Leahy, former CEO of Tesco plc, spoke about the need to improve the dissemination and understanding of data within large retailers and other organizations. As research tools become more powerful and useful – from generating understanding of potentially new, developing markets, to specific, localised consumer segments and their behaviours – it remains important that these insights are clear and actionable while reaching the right pairs of eyes.   

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July 19, 2014

Function and Local Ingredients Drive Hot Drinks Sales in Peru

Dana LaMendolaAnalyst Insight by Dana LaMendola - Beverages Analyst

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Our research indicates that Peru will be the fastest-growing hot drinks market in Latin America increasing by 36% to reach US$ 818 million  by 2018. The Peruvian economy has skyrocketed in recent years, with Peru recording the fastest growth in total GDP in the region between 2008 and 2013, a trend that is expected to continue in the forecast. Rising disposable incomes are not only increasing consumer expenditure on food and non-alcoholic beverages, but are also creating more demanding Peruvian consumers. Hot drinks that are having the most success are those like fruit/herbal teas that have a functional position and other plant based hot drinks that appeal to local Peruvian traditions through the use of local ingredients

 

Demand for Health and Wellness Benefits

Peru is expected to be the fast growing tea market in Latin America over the forecast, increasing by 59% in retail value to record the second highest absolute value growth after Brazil. In Peru, tea is already nearly as popular as coffee in terms of at-home consumption. In 2013, per capita retail brewed volume was 6 litres, just slightly below coffee which was 6.8 litres. Although black tea (both standard and speciality) is the most traditional type of tea consumed in Peru, health and wellness trends are causing less mature categories like fruit/herbal tea and green tea to attract increasing consumer interest because of their perceived health benefits. These alternative tea types also carry a higher price tag, particularly fruit/herbal which in 2013 retailed at more than five times the unit price of black tea.

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July 12, 2014

Coffee Shops are Best Positioned to Benefit from Mobile Payments

Dana LaMendolaAnalyst Insight by Dana LaMendola - Beverages Analyst

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Starbucks is the reigning poster-child for mobile payment implementation in US consumer foodservice. While its popular loyalty programme and early move into mobile payments contribute to Starbucks’s celebrity status, the company’s success is also reflective of the particular compatibility of specialist coffee shops and mobile payments. In fact, coffee shops might be the best positioned for mobile payments out of all consumer foodservice operators.

The reason that specialist coffee shops are so well positioned is that their primary offering – coffee – is an everyday and oft-repeat purchase. Indeed, in 2013 US consumers averaged over one cup of coffee per day. A large number of coffee shops purchases are made by commuters looking for their morning jolt on the way to the work.  The high frequency of purchases by coffee shops patrons make these consumers prime candidates for the streamlined payment methods and loyalty benefits afforded by mobile payment technologies. Furthermore, coffee shops are most attractive to demographics that have both access to and interest in mobile technology: affluent consumers, and younger tech-savvy consumers like students.

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July 10, 2014

Five Key Takeaways from Starbucks' M-Commerce Success

The Starbucks mobile payments app has provided one of the best case studies for how to drive consumer adoption of in-store purchases made via a mobile phone. For retailers or foodservice operators looking to replicate Starbucks’ success, there are several best practices to keep in mind before developing, implementing and launching a mobile payment app.

 Join Euromonitor in attending the Connect Mobile Innovation Summit in Chicago, IL from August 18-20th. Senior Consumer Finance Analyst Michelle Evans will be there with many others to learn more and talk about mobile payments in the foodservice industry.

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July 3, 2014

Instant Coffee: Versatility and Convenience Drive Growth

Instant-Coffee-GB-Sample-Slide

Although fresh coffee dominates the overall coffee industry, instant coffee continues to gain share, thanks in large to its appeal amongst new coffee drinkers. The convenience, versatility, and branded experience of instant coffee make it an attractive consumer product in emerging coffee markets, while in established markets, instant coffee seeks to shed its commodity image to sustain consumer interest.

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June 24, 2014

What Next for Mondelez’s Hot Drinks Following the JDE Deal?

Hope.LeeAnalyst Insight by Hope Lee - Senior Beverages Analyst

Once coffee leaves the Mondelez family, other hot drinks such as chocolate-based flavoured powder drinks will be the main hot beverages left. Other hot drinks together with the powder concentrate brand Tang will form Mondelez’s major beverage business following the deal with DE Master Blenders to create Jacobs Douwe Egberts (JDE) and will account for an insignificant share of its global fmcg sales. In the days of Kraft, chocolate-based flavoured powder drinks appeared to be a minor area of its beverages business. Euromonitor International believes that there may be substantial cross-branding opportunities for the Cadbury brand, which may have encouraged Mondelez to retain its chocolate powder drinks. Mondelez is the world’s largest chocolate confectionery maker and the ingredients used in its chocolate powder drinks (cocoa) are similar to those used in its confectionery. Therefore, procurement-wise, it makes sense to keep cocoa-centric Cadbury in the family.

 

Continue reading "What Next for Mondelez’s Hot Drinks Following the JDE Deal?" »

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Recent Posts

Kraft Licenses Coffee Brands for use in Green Mountain's Keurig

Tata’s State of Play in Global Coffee and Earth Rules Acquisition

Lipton: Hot Tea and RTD Tea Major Market Sales

Can the Bkon Craft Brewer Steal Customers from the Coffee Pod Market?

Shopper Insights in Action Conference 2014 – IIR – Event Recap

Function and Local Ingredients Drive Hot Drinks Sales in Peru

Coffee Shops are Best Positioned to Benefit from Mobile Payments

Five Key Takeaways from Starbucks' M-Commerce Success

Instant Coffee: Versatility and Convenience Drive Growth

What Next for Mondelez’s Hot Drinks Following the JDE Deal?