As the fastest-growing segment in soft drinks1 – set to grow by as much as £183m over the next five years2 – ready-to-drink (RTD) coffee is yet to realise its full potential. So how can convenience retailers ensure success in their stores?
The RTD coffee sector is now worth more than £165m3 and is growing in value at a rate of more than 20%4. The sales opportunity for convenience retailers is significant.
Costa Coffee’s RTD coffee range is already the second biggest in convenience after only two years on shelves5. It has doubled in size in 20206, with more than half of Costa Coffee RTD consumers coming into the sector for the first time7.
Convenience stores should combine the appeal of the Costa Coffee brand with category insights and advice taken from Coca-Cola Europacific Partners (CCEP), its manufacturer and distributor. Read below for three top tips or listen to CCEP category development director Oliver Crick and retailer Mandeep Dhillon in the video below to help you increase your RTD coffee sales.
1. Range: Appeal to more shoppers
RTD coffee appeals to a variety of different shoppers8, which is why it’s such a strong and growing segment within soft drinks. But your range needs to meet different needs and taste preferences to perform well in your store.
It’s important to offer RTD coffees with different caffeine, milk and sugar content, as well as in a range of flavours and formats. Multi-packs and sharing pack formats should also be considered to complement the on-the-go range.
Each product in the Costa Coffee RTD range has a different taste, milk and caffeine profile, offering an authentic coffee experience with less milk and 30% less sugar than its competitors9. The flavours in the range are also inspired by the best-sellers in Costa Coffee shops, including the signature Mocha Italia blend.
2. Visibility: Signpost your fixture
Range is important, but variety can be confusing. As such you should keep your RTD coffee products together in the chiller, grouped by brand and clearly signposted so that the fixture is easy to shop.
For Costa Coffee RTD, this means placing the original Latte and Caramel Latte variants next to the recently launched Vanilla Latte flavour. This leverages the brand’s strength on the shelf to catch shoppers’ eyes and draw them to the fixture.
3. Drive trial: Secondary displays
Getting new shoppers to try RTD coffee and existing shoppers to experiment with different variants is key to unlocking growth. Retailers and suppliers both have a role to play.
Try secondary displays in-store to inspire purchases throughout the day. Meal bundle deals can also be effective, with more than half of RTD coffees being enjoyed with food10.
Sampling has been key to the success of Costa Coffee RTD. With Costa Coffee celebrating its 50th anniversary this year, the plan is to get 500,000 cans into hands to increase awareness and encourage shoppers to repurchase at their local stores.
Hear more from Oliver Crick, GB category development director at CCEP, and convenience retailer Mandeep Dhillon from Go Local Extra, Heston:
1 Nielsen NCB sector report, RTD Coffee, Total GB incl. discounters, val MAT w/e 26.12.20
2 Kantar: RTD Coffee Presentation, Sept 2019, Kantar: RTD Coffee Source of Growth Presentation, July 2020
3 Nielsen Total GB incl. discounters, val MAT w/e 26.12.20
4 Nielsen NCB sector report, RTD Coffee, Total GB incl. discounters, val MAT w/e 26.12.20
5 Nielsen Total impulse, val MAT w/e 26.12.20
6 Nielsen NCB sector report, RTD Coffee, Total GB incl. discounters, val MAT w/e 26.12.20
7 Kantar Worldpanel Division – Take Home Purchase Data, Jun 2019 - Mar 2020
8 Kantar: RTD Coffee Presentation, Sept 2019, Kantar: RTD Coffee Source of Growth Presentation, July 2020
9 Costa Research July: 30% less sugar versus most RTD coffee drinks in GB
10 Bespoke CCEP Research, Kantar & Brand Potential 2020