S&D Coffee & Tea newly released white paper, How to Deliver a Better Beverage Experience, identifies the latest beverage trends.
Soda consumption reached a 31-year low in 2016, leaving ample room in the better-for-you (BFY) beverage space, according to the white paper. Operators can boost beverage sales, and the meaningful incremental profits that come with them, by focusing on three key areas:
Within functional beverages, S&D has identified three main areas of focus:
- botanicals (to be used as health and flavor agents)
- protein (namely the use of collagen in beauty drinks)
- superfoods (think charcoal lattes and mushroom coffee)
These ingredients have enjoyed significant menu growth in recent years, with turmeric and charcoal use increasing by a particularly high 200%.
Twists on old favorites
S&D has identified six ways that operators can elevate staple beverage offerings, such as offering craft sodas, custom-blended juices and trendy cold coffees like nitro and cold brew (a category projected to grow by nearly 80% by 2021).
Even water represents a menu opportunity: With the explosive popularity of natural sparkling waters comes interest in exotic alternatives like maple, coconut and cactus water.
Making an emotional connection
More and more customers, particularly those in the Gen Z and millennial generations, are interested in the story behind the food and beverages they purchase. This is where creating an emotional connection is key. Delving into a menu item’s origins and sustainability story can create a lasting impression on even the savviest consumer.
Demand for authentic beverages made with real, BFY ingredients is not going away any time soon. On the contrary, growing numbers of consumers are seeking a better beverage experience every day. Along with flavor and convenience, consumers are seeking beverages with benefits.
Nutrition-packed superfoods like turmeric and charcoal and botanical agents like lemongrass, elderflower and hibiscus are now being infused in everything from cocktails to coffees and teas. Not only do these health-forward ingredients pack nutritional properties, unique flavors and brilliant colors, they also play well on social media, leading to a surge in trending Instagram posts featuring charcoal lattes turmeric teas and more.
“Operators can take advantage of these trends in the form of limited-time offers that can create buzz or are craveable,” said Helen Griffith, VP, Marketing at S&D Coffee & Tea. “An LTO creates a sense of urgency and highlights the special craft nature of these drinks.”
The white paper suggests that operators test their customers’ thirst for premium beverages with LTO offerings like turmeric iced tea or a vanilla collagen latte.
“These trends put to rest the notion that customers are hesitant to spend money on nonalcoholic beverages,” Griffith said. “For example, menu mentions of craft soda have increased by 40% over the past four years, while lemonade appears on 60% of menus. Clearly there is great interest in premium, nonalcoholic beverages, especially those with artisanal appeal that tell a great story.”