Whilst a small channel for other hot drinks, volume growth of other hot drinks through foodservice, driven by chocolate-based flavoured powder drinks, continued to outperform retail prior to the emergence of the pandemic. Nevertheless, whilst the temporary closure of foodservice operators in 2020 as a result of the lockdown resulted in double-digit decline for other hot drinks through this channel, there was no obvious switch towards retail, with the latter recording a flat performance in comparison to the previous year, as coffee continued to offer competition to the category in terms of home consumption.
With other hot drinks the smallest category within the market in Lithuania, retailers and players offering these products are attempting to tap into niche trends in an attempt to attract adult consumers who appreciate quality and premium cocoa products. According to cocoa supplier and retailer Gyva Kakava, premium quality cocoa is increasingly used and appreciated by those consumers who are searching for gourmet flavours.
The competitive landscape of other hot drinks remained fairly consolidated between two major players; Nestlé Baltics UAB (Nesquik) and Daisena UAB (Mix-Fix). Nestlé has continued to focus on products which address health and sustainability, by releasing a new cocoa-based drink under its leading brand called Nesquik All Natural, which is produced from 100% natural ingredients.
Despite a predicted stronger volume growth performance for foodservice over the forecast period compared with retail in terms of other hot drinks, this will be mainly driven by a rapid return to cafés as restrictions are relaxed in 2021, before greater normalisation in terms of consumer behaviour. Therefore, the notable decline suffered by other hot drinks via foodservice means that volume sales are unlikely to recover to pre-pandemic levels by 2025.
Health trends are likely to encourage players to review the content of their chocolate-based flavoured powder drinks, with many health organisations and parents in Lithuania displaying concerns about high sugar intake amongst children. Players are therefore introducing fortified options and launching reduced-sugar and sugar-free options to appease parents.
Value sales witnessed further growth in 2020 due to rising unit prices as cocoa suppliers applied mark-ups to raw materials due to reduced demand for cocoa beans as a result of the pandemic, impacting chocolate and cocoa powder. Furthermore, global warming is continuing to have a negative impact on farmers’ cocoa crops, a trend that is likely to only strengthen.
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Understand the latest market trends and future growth opportunities for the Other Hot Drinks industry in Lithuania with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
Key trends are clearly and succinctly summarised alongside the most current research data available. Understand and assess competitive threats and plan corporate strategy with our qualitative analysis, insight and confident growth projections.
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This report originates from Passport, our Other Hot Drinks research and analysis database.
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