Other Hot Drinks in Azerbaijan

2021 DEVELOPMENTS

Other hot drinks rebounds in foodservice, supported by sales of chocolate-based flavoured powder drinks

Other hot drinks continues to be a niche category in Azerbaijan, with the slowdown in sales continuing into 2021. Whilst on-trade volume sales crashed in 2020 due to impacts from the pandemic, the increase in retail sales did not compensate overall.

No notable developments expected in niche category over the forecast period

Despite growing from a very low base, the category of other hot drinks does not see much development in Azerbaijan. This lies in line with the strong tea drinking culture across all age groups and consumers’ low awareness of the advantages of other hot drinks overall.

Other plant-based hot drinks remains a negligible niche, albeit with scope to grow

Other plant-based hot drinks remains negligible in Azerbaijan, although such products are starting to appear more often. Along with the strengthening year-on-year demand for healthy food and drink alternatives, big city dwellers are turning their attention towards plant-based products.

PROSPECTS AND OPPORTUNITIES

Children remain core consumer base, which poses demographic challenges

The main consumer base of other hot drinks consists of small and young children. This core base will be challenged with the expected decrease in the number of children from 0-14 years.

On-trade developments may lead to new and trendy other hot drinks being launched

On-trade development and the expansion of menus with non-traditional drinks, alongside developments in coffee shops, will push the interest of consumers to other drinks than just tea and coffee. For example, chocolate-based other hot drinks might be perceived as a good alternative to desert, or as a trendy drink with different options.

Nestlé set to maintain its undisputed lead, with developments in lower-sugar variants and milk alternatives expected

Nestlé Azerbaijan Ltd is expected to remain the undisputable leader over the forecast period, despite the entry of other players. The latter are expected to be fragmentally present, while the Nesquik brand from (from Nestlé) will be a part of well-developed distribution chain and supported with well-known brands which are seen and recognised in other food categories (for example, in countlines).