Hot drinks saw steady retail volume growth in 2018 thanks to increased consumption of fresh coffee, especially fresh ground coffee pods and standard fresh ground coffee. Consumers have become more knowledgeable about coffee, including the different types and even roasting levels, and are seeking barista-quality coffee that can be consumed in the comfort of their home.
Fresh ground coffee pods saw dynamic retail volume growth over the review period and this continued in 2018, with grocery retailers rapidly expanding their range. The variety of fresh ground coffee pods offered in grocery retail chains, both private label and branded products, has expanded considerably and many consumers now prefer to purchase these products as part of their weekly grocery shopping rather than having to order online from a different supplier.
Strauss Group Ltd continues to lead hot drinks in Israel largely thanks to its wide variety of products in coffee under the brand Elite, as well as its well-established brand Chocolit in other hot drinks. In coffee, the company is a constant innovator, frequently launching new products while at the same time promoting older, well-established brands by encouraging consumer engagement to create a stronger emotional connection.
New launches in 2018 focused on growing categories, including fresh ground coffee pods and organic tea. In fresh ground coffee pods, café chain Landwer launched its private label pods in aluminium capsules, while Diplomat Distributers began importing aluminium fresh ground coffee pods from the brand L'Or.
Over the forecast period, growth is set to slow considerably within hot drinks in comparison with the review period. Unit prices are expected to fall due to rising competition, especially in coffee, resulting in slower value growth, while retail volume growth is expected to remain more stable.
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This industry report originates from Passport, our Hot Drinks market research database.