Coffee and tea lovers can rejoice: tastier ways to get a caffeine fix are on their way to cold cases and retail shelves, courtesy of RTD purveyors in search of new ways to drive category sales.

A perennial go-to thirst quencher, RTD tea is finding new fans thanks to its associative health benefits. “Consumers today are savvier than ever, particularly when it comes to nutrition,” says John Clarkson, brand manager for Lipton Original (part of Pepsi-Cola North America). “As such, they are adjusting their diets to include foods and beverages that not only taste good, but are good for them as well.”

Top ready-to-drink teas by brand
Brand	Dollar Sales	% Change Vs. Prior Year	Market Share	% Change Vs. Prior Year
Arizona	$214,871,400	45.0%	28.6	5.3%
Snapple	$97,525,640	6.2%	13.0	-1.5%
Diet Snapple	$87,541,020	14.1%	11.7	-0.4%
Lipton Brisk	$78,295,500	-8.1%	10.4	-3.0%
Nestea Cool	$56,288,980	-16.7%	7.5	-3.1%
Lipton	$54,408,740	204.7%	7.2	4.4%
Lipton Iced Tea	$41,951,630	4.1%	5.6	-0.8%
Private label	$27,476,830	16.1%	3.7	-0.1%
Nestea	$14,853,450	13.0%	2.0	-0.1%
SoBe	$14,798,130	22.3%	2.0	0.1%
Category total	$750,577,300	18.3%	100.0	0.0%
Source: Information Resources Inc. Total food, drug and mass merchandise (excluding Wal-Mart) for the 52 weeks ending Dec. 25, 2005.

Top ready-to-drink coffees by brand
Brand	Dollar Sales	% Change Vs. Prior Year	Market Share	% Change Vs. Prior Year
Frappuccino	$157,935,900	20.4%	82.8	-3.3%
Starbucks Doubleshot	$24,454,620	43.8%	12.8	1.7%
Wolfgang Puck	$4,918,319	468.0%	2.6	2.0%
Starbucks	$1,438,719	32.1%	0.8	0.0%
Kahlua	$846,472	7.7%	0.4	-0.1%
Havana	$410,759	-10.6%	0.2	-0.1%
Caffe D Vita	$195,541	7.0%	0.1	-0.0%
Mr Brown	$122,840	-0.3%	0.1	-0.0%
Royal Kona	$112,825	-56.4%	0.1	-0.1%
Main St Cafe	$111,982	-23.3%	0.1	-0.0%
Category total	$190,799,400	25.1%	100.0	0.0%
Source: Information Resources Inc. Total food, drug and mass merchandise (excluding Wal-Mart) for the 52 weeks ending Dec. 25, 2005.

To help consumers make smart beverage choices, Clarkson says Lipton has developed a first-of-its-kind AOX Seal, a proprietary mark that indicates substantial levels of antioxidants. The mark is found on select Lipton Original and Lipton Iced Tea products that are rich in protective antioxidants. “With regard to RTD trial, consumers are looking for great taste and refreshment, first and foremost. In our current marketplace, products that deliver taste and refreshment while also contributing to a healthy, active lifestyle by providing ‘health attributes,’ such as AOX, really drive repeat purchase.”

Lipton Iced Tea recently launched three new iced tea products and two new Lipton Original products. Due to debut on shelf in late March are Lipton Iced Tea Diet Peach, Lipton Iced Tea Peach, Lipton Iced Tea Green Tea with Mixed Berry, Lipton Original White Tea with Tangerine and Lipton Original Green Tea with Orange Passionfruit.

The RTD tea segment has experienced a flurry of new product activity in the past five years.

Traditional tea beverages have had competition from new green and white tea products touting flavor and the potential for even greater health benefits.

Andy Schamisso, founder, president and self-described “chief conduit to a new healthy drink” at New York-based Inko’s LLC, says his company’s product is among the “fastest, steadiest and most sustainable category in the entire beverage business.

“According to published reports, tea will be a $10 billion category in 2010,” he says. “Driving that growth will be the major contributor to that category: RTD specialty tea.”  

Baby boomers are key to the future growth of these specialty RTD teas, and Schamisso says retailers are listening. “Whole Foods Markets (which has always known the health factor) are aggressively opening more and more stores each year,” he says. “Large supermarket chains are now dedicating more aisle space to natural products. Some are opening ‘store within a store’ natural markets. And even big box retailers, like BJ’s Wholesale Club, which took a chance with Inko’s, are rethinking their audience and taking on healthier brands.”

Last fall, Inko’s expanded its line of 100 percent natural RTD iced white teas with four new flavors: Inko’s Lychee White Tea, Inko’s Apricot White Tea, Inko’s Cherry Vanilla White Tea and Inko’s Unsweetened Honeysuckle White Tea.

Apricot, Lychee and Cherry Vanilla are lightly sweetened brews (less than 60 calories/14 grams of sugar per 16-ounce bottle) that are made with rare white tea and natural fruit and flavor extracts. Inko’s Unsweetened Honeysuckle will be the company’s second calorie-free/carb-free brew for those consumers who don’t want any sugar. All of Inko’s White Teas contain less than 6 mg. of caffeine per bottle, and are formulated to avoid harsh or bitter aftertastes.

“From a sales perspective, each of our previous five flavors have grown significantly, to the point where we felt now was the time to pull the trigger on new flavors we have been developing for the past year,” Schamisso says. “After all, our trademark is ‘What White Tea Tastes Like’ and it is our job to complement our existing line with tasty drinks that add significantly to customer satisfaction on a flavor-by-flavor basis.”

Generating brand awareness and connecting with the consumer has become a tough proposition for RTD tea manufacturers, given how crowded the market has become. While health benefits might arouse the curiosity of a prospective consumer, other factors have subtle supporting roles in the purchase. “Generally, whether it is single-serve or box, the first thing consumers look for is an appealing ‘grab-me-off-the-shelf’ package,” Schamisso says. “Personally, I think that package has to be in glass and the color of the beverage shown to the consumer. Then it’s price point (especially in this type of economy). Repeat purchases rest solely on the taste and quality of the product.”

Revolution Tea, Phoenix, Ariz., added new glass bottle packages to its RTD White-T range, with white full-body wrap labels that provide an aesthetically striking contrast to the vivid fruit images denoting the flavor contained within.

Revolution Tea’s premium White-T RTD offerings — in Blackberry, Tangerine, Raspberry and Key Lime flavors — have no carbohydrates, calories, sugars, sweeteners or preservatives, and are rich with antioxidants says Jeff Irish, creative director for the company.

White tea is the rarest and most delicate variety of tea. It is the least processed tea and does not undergo withering, oxidation, fermentation or firing. White tea contains the same polyphenol antioxidants found in green tea, but because it is processed less, it is believed to be more beneficial.

Like white teas, RTD green teas also are renowned for their health benefits and continue to do well at retail. But in addition to health benefits, increasingly health-conscious customers are in search of products that won’t add to their waistlines. “People are turning away from heavily sugared products and are looking for healthier beverages, (like) tea,” comments Francie Patton, vice president of corporate communications at Arizona Beverages. “Customers (also) look for a great tasting product given to them at a fair price. In RTD teas, they are looking for healthier, delicious beverages.”

To that end, Arizona bowed Diet Decaf Green Tea. Dubbed “good for what it doesn’t have,” the tea is made with the premium green tea and sweetened with Splenda, offering all of the health benefits of Green Tea, but with zero calories, zero carbs and no caffeine.

The product is packaged in the same 20-ounce proprietary bottle as the Arizona Diet Green Tea product and has the same Japanese illustration on the label. But to distinguish the new Diet Decaf from the established product, the background of the label has been given the look of black lacquer. The beverage is also available in a 1-gallon container. Suggested retail is $1.25 - $1.49 per 20-ounce bottle.

While a growing variety of new RTD coffee beverages can be found at retail, the segment is arguably dominated by Starbucks.

RTD coffee has found a following and is growing for a number of reasons, says Kelli McCusker, director of marketing for the Pepsi-Starbucks North American Coffee Partnership. “Consumers are increasingly seeking non-carbonated products to provide variety within their daily consumption,” she says. “Consumers who are seeking energy benefits in their beverages view coffee as a natural choice. For instance, Starbucks DoubleShot is popular as morning consumption, as consumers view it as a beverage to help motivate them to get their day off to a good start. “

Keen to build on the success of its Starbucks Frappuccino and Starbucks DoubleShot products, the company is set to launch a number of new products this spring. Starbucks Iced Coffee is a light-tasting iced coffee drink made with Starbucks Italian Roast coffee and a touch of milk and sweetener. It will be available in Regular and Light versions.

Also coming this spring is Starbucks DoubleShot Light, which will have half as many calories, two-thirds less sugar and one-third less fat than original DoubleShot.  

Also making waves in the category are new coffee/soft drink blends, which despite a few false starts in the past, are hoping they have found their time for success. Pepsi attempted to merge cola and coffee with Pepsi Kona in the mid-90s, but the product was discontinued due to less-than-spectacular consumer reception. The company, however, found success with similar coffee-cola beverages in overseas markets, and a few new products are hoping to make the same headway in the United States.

Coca-Cola has announced plans for a March launch of Coca-Cola Blak, its “Coca-Cola and coffee fusion” soft drink that is billed as “an invigorating and stimulating blend” with “a perfect balance of the effervescent taste sensation of Coca-Cola and natural flavors, with real coffee.”

But unlike Kona, Blak is not just a cola flavor extension. It was designed to appeal to a new target group of adult consumers. “It is a blend of unique Coke refreshment with the true essence of coffee and has a rich smooth texture and has a coffee-like froth when poured,” says Marc Mathieu, vice president of global core brands, The Coca-Cola Co. “We believe we have created a new category of soft drink – an adult product in a carbonated beverage – and a whole new drinking experience. This brand is ideal for any part of the day when people are looking for renewed energy or simply to take a break.”

The lightly carbonated, 45-calorie-per-bottle beverage is sweetened with a blend of high fructose corn syrup and one or more diet sweeteners and will be sold in 8-ounce glass bottles.

Green Mountain Coffee Roasters Inc., Waterbury, Vt., launched its own coffee alternative to traditional soft drinks late last year. Double-Bean Elixirs are carbonated coffee sodas that the company says offer consumers an environmentally friendly and socially responsible choice of cold beverages.

Created from Green Mountain’s own fair trade certified organic coffee, the Double-Bean Elixirs come in five flavors: Original, Vanilla, Hazelnut, Mocha and Almond. They are available in 12-ounce bottles and four-packs, and are being introduced first to select northeast retail locations.

And finally, New York-based Shock Coffee has taken the caffeine fix to a whole new level with Shock Triple Latte and Shock Triple Mocha – “hyper-caffeinated” RTD beverages made with a specially roasted blend of coffee beans that packs 50 percent more caffeine than other gourmet coffees. The products are sold in four-packs of 8-ounce cans and in 24-can cases.  BI