Nestlé (China) was witnessing solid growth in its sales and share in the review period before the pandemic. Although the closure of schools, forecourt retailers and some convenience stores due to the pandemic heavily hit sales of Nestlé’s RTD coffee in the first half of 2020, the closure of consumer foodservice outlets such as coffee shops and the suspension of take-out services, as well as the inconvenience of brewing fresh coffee at home, led RTD coffee to see solid growth rates in off-trade volume and current value terms in 2020.
Over the review period, there were already manufacturers launching carbonated RTD coffee to try and attract a wider consumer group. For instance, local player Nongfu Spring launched cold brew flavoured carbonated RTD coffee in May 2019, which was the first carbonated RTD coffee brand in China.
After being delayed by COVID-19, COSTA, the UK's largest coffee chain, introduced RTD coffee to China, backed by Coca-Cola. The company's new ready-to-drink coffee products entered China at the end of March 2020 and include Black Americano and Classic Latte flavours.
RTD coffee is expected to maintain strong although slowing growth in the forecast period in both off-trade volume and current value terms. Euromonitor International’s health and nutrition survey 2020 indicated that Chinese consumption of caffeine was far below the global average, therefore there are plenty of opportunities for growth.
Another important factor driving growth will be consumption upgrading. RTD coffee is expanding by targeting the post-90s and post-95s generations as key consumer groups.
In addition to the carbonated references previously mentioned, other new variants and flavour innovations are being seen in RTD coffee, which is expected to help the category attract a wider audience in the forecast period. For example, Starbucks Corp launched flat white RTD coffee, which was marketed as a trendy drink with a rich aroma, caramel-like sweetness and more mellow taste in cup-style packaging.
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Includes packaged ready-to-drink coffee, consumed either hot or cold, made using a base of either brewed coffee or coffee extract. Excludes all coffee flavoured milk drinks that primarily target children, or where coffee is one of a number of flavours within the brand range. Leading brands in off-trade volume include Georgia, Nescafé and Suntory Boss.See All of Our Definitions
This report originates from Passport, our RTD Coffee research and analysis database.
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