Tea and Coffee

2022 State of the Beverage Industry | Ready-to-drink coffee market still on the rise

Cold brew, single-cup coffee gives consumers specialty coffee at home

Mornings just wouldn’t be the same without a hot cup of Joe. And now, with plenty of ready-to-drink options and a variety of ways to enjoy coffee, it’s even easier to grab and go to get the day started. You’ll just have to decide how you like your coffee first.

According to Chicago-based Information Resources Inc. (IRI) data, ready-to-drink (RTD) refrigerated coffee sales were at $925.4 million, a 31.5% year-over-year (YoY) increase for the 52 weeks ending May 15, in total U.S. multi-outlets.

In Beverage Industry’s September 2021 eMagazine, IRI’s Executive Vice President and Practice Leader, Sally Lyons Wyatt, acknowledged the coffee market’s uptick in sales, primarily in the RTD and single-cup segments.

“Ready-to-drink and single-cup are the segments driving coffee growth … The easy, convenient nature of brewing a single cup at home has increased in popularity since the start of COVID,” Wyatt said. Many consumers, despite working remotely because of the pandemic, want a “coffee shop experience at home,” she added.

Top RFG RTD coffee (individual brands)

		DOLLAR SALES	% CHANGE vs PRIOR YEAR	MARKET SHARE	% CHANGE vs PRIOR YEAR
1	Starbucks	$377,359,503	28.3	40.8	-1
2	Stok	$191,346,679	32.4	20.7	0.1
3	Int'l Delight	$162,469,998	36.9	17.6	0.7
4	Califia Farms	$57,321,328	31.7	6.2	0
5	Coca Cola	$42,485,871	67.4	4.6	1
	Category Total*	$925,455,670	31.5	100	---

*Includes brands not listed
Source: Information Resources, Inc. (IRI), Chicago. Total U.S. supermarkets, drug stores, gas and convenience stores, mass merchandisers, military commissaries, and select club and dollar retail chains for the 52 weeks ending May 15.

Within the refrigerated RTD coffee segment, Starbucks leads the pack with more than $377 million in sales, a 28.3% YoY increase for the 52 weeks ending May 15, according to IRI data. The Coca-Cola Co. saw a large jump in dollar sales, with a YoY increase of 67.4% for the same time-period, IRI data shows.

Starbucks, Stok and International Delight remain the Top 3 contenders in the refrigerated RTD segment. Califia Farms took the fourth place spot, previously held by Starbucks Iced Espresso Classic, seeing a 31.7% increase in dollar sales compared with last year. Coca Cola came in fifth place at just above $42 million in sales, IRI data shows. The total category sales for RTD refrigerated coffee was more than $925 million, a significant jump compared to last year’s $752 million.

Super Coffee Variety 12 Pack — *Image courtesy of Super Coffee*

New York-based Beverage Marketing Corporation’s (BMC) Managing Director of Research, Gary Hemphill, called ready-to-drink “the hottest coffee segment,” in Beverage Industry’s September 2021 eMagazine.

“Once primarily a category dominated by single-serve packaging, ready-to-drink coffee in chilled, take-home format packaging has burst onto the scene and is driving much of the growth,” Hemphill said.

He added that recent beverage trends are “mixing things up” for the coffee category, with new innovations like energy coffee drinks, cold brew, and nitro hiking up coffee sales.

IRI’s Wyatt echoed similar thoughts, having said that cold brew and nitro cold brew “are very small segments, but are growing fast.”

“Forms such as cold brew, iced coffee, nitro, etc., have given consumers the ability to have a specialized drink without the hassle and mess of making a cup at home,” Wyatt said in Beverage Industry’s September 2021 eMagazine.

Top single-cup coffee (individual brands)

		DOLLAR SALES	% CHANGE vs PRIOR YEAR	MARKET SHARE	% CHANGE vs PRIOR YEAR
1	Keurig	$1,215,050,059	1.8	23.7	-0.8
2	Private Label	$1,072,443,998	0.3	20.9	-1
3	Starbucks	$958,491,562	8.5	18.7	0.6
4	J M Smucker Dunkin	$510,282,805	9.3	9.9	0.4
5	Folgers	$359,143,112	14.2	7	0.5
	Category Total*	$5,137,875,955	5.3	100	---

Meanwhile, with $5 billion in sales for the 52 weeks ending May 15, the single-cup coffee segment continues to be the best-selling type of coffee, IRI data shows. Out of the Top 5 brands, Folgers saw the greatest increase in dollar sales compared with last year, with a 14.2% gain. Keurig’s dollar sales increase was more marginal with a 1.8% YoY increase, according to IRI data.

Nevertheless, Keurig topped the segment, with $1.2 billion in dollar sales for 52 weeks ending May 15, IRI data shows. Private label is barely behind, with just above $1 billion for the same time-period. Starbucks, Dunkin’ and Folgers round out the rest of the Top 5.

Although the brand wasn’t in the Top 5, Tim Hortons single-cup sales saw a 34.6% YoY increase, with almost $44 million in sales. Saratoga Springs, N.Y.-based Death Wish Coffee also had a significant jump in dollar sales with a 25.3% YoY increase for the 52 weeks ending May 15, IRI data shows.

Caleb Bryant, associate director of food and drink reports at Chicago-based Mintel, noted in Beverage Industry’s September 2021 eMagazine that the coffee market is projected to reach $18.9 billion by 2026.

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Chloe Alverson is Beverage Industry’s associate editor, writing and editing for the magazine about all sorts of beverages and companies. She earned a Bachelor of Arts in Journalism from Michigan State University and resides in Metro Detroit.