Abstract
Why buy this report
- Get insight into trends in market performance
- Pinpoint growth sectors and identify factors driving change
- Identify market and brand leaders and understand the competitive
environment
Product coverage
Coffee; Other hot drinks; Tea
Executive summary
Ethical hot drinks products prove increasingly popular with UK consumers
Be it Fairtrade, sustainable development or other initiatives such as the
Ethical Tea Partnership, hot drinks products which tapped into the ethical
consumerism trend proved hugely successful in 2007, particularly in coffee. In
tea, the question of supply still remained an issue, with an insufficient
number of Fairtrade estates producing branded or even private label Fairtrade
tea products. During the review period, many UK consumers came to see the
purchasing of Fairtrade products as their way of making a small contribution
to the fight against global poverty. Recognising the growing public support
for ethical consumerism and sustainable development, major retailers like
Marks & Spencer and Co-Op decided to only offer Fairtrade coffee and tea
products in their outlets. The launch of a Fairtrade organic Mayan
chocolate-based flavoured powder drinks product under premium chocolate
confectionery brand Green & Black' s in 2007 confirmed that the ethical
consumerism trend is still gaining momentum in the hot drinks market.
UK consumers trade up to more indulgent hot drinks products
Rising disposable incomes encouraged many UK consumers to trade up to higher
quality, more expensive hot drinks products during the review period. Rising
demand for premium positioned fresh ground coffee, specialty tea and
chocolate-based flavoured powder drinks products continued to drive growth in
retail hot drinks current value sales in 2007. Higher spending on premium
lines also helped to compensate for sluggish growth in retail volume sales.
Premium hot drinks products were increasingly viewed as affordable luxuries,
and with more money in their pockets, many UK consumers were prepared to pay a
little extra to indulge themselves. With rising demand for higher quality
products evident in all packaged food and beverage categories, consumer
interest in the provenance and traceability of hot drinks products also
increased. This trend was closely linked to the trend towards ethical
consumerism, and saw UK consumers become more well informed about coffee
blends or the origins of tea and cocoa-based products.
Health and wellness trend is strongest in the tea sector
As was the case in other UK packaged food and beverage categories, the health
and wellness trend continued to play an influential role in the development of
hot drinks in 2007. Decaffeinated tea and coffee products proved increasingly
popular with consumers seeking to live healthier lifestyles. Manufacturers
focused on developing new decaffeinated tea and coffee variants that compared
favourably with standard products in terms of taste and quality. Strong growth
in demand for decaffeinated products in both sectors is testament to their
success. Tea also benefited as green and fruit/herbal tea showed robust growth
in retail volume and current value sales. Younger urban professionals leading
busy lifestyles proved especially receptive to fruit/herbal tea products
offering specific effects or health benefits, such as the ability to help the
drinker relax, regain energy or detox. Demand for green tea products meanwhile
(both standard and decaffeinated varieties) continued to grow thanks to
widespread media coverage of their health benefits, specifically their high
antioxidant content.
Development of the UK café culture shapes retail coffee offerings
The presence of speciality coffee shops outlets such as those in the Costa
Coffee and Starbucks chains on nearly every high street in the UK continued to
have a major influence on consumer attitudes to coffee in 2007. The ubiquity
of espresso-based coffee varieties in such outlets encouraged many consumers
to try and recreate the specialist coffee shops experience at home, boosting
demand for speciality fresh ground coffee products at the retail level. In
late 2006, Starbucks-branded fresh ground coffee products were made available
in the outlets of major UK retailers, strengthening this trend. Coffee pods
products meanwhile continued to provide a stepping stone between instant
speciality and specialty fresh ground coffee for many consumers.
Despite increased consumer sophistication, traditional favourites dominate tea
Similar to patterns witnessed in packaged food and wine, during the review
period trend-setting consumers started to experiment with more exotic and
premium products in tea. In a reaction against the perceived commoditisation
of the sector as a whole, single estate and fine tea products proved
increasingly popular. In 2007, however, traditional favourites continued to
dominate, with black standard tea bags accounting for 86% of retail tea volume
sales.
View Cart
