Thursday, June 8, 2017

Top Non-Alcoholic Drinks Trends Seen at the 2017 National Restaurant Association Show

The National Restaurant Association Show hosted its 98th annual National Restaurant Association Restaurant, Hotel-Motel  Show and Beverage Alcohol for Restaurants (BAR) at NRA Show from May 20–23, 2017 at Chicago’s McCormick Place. In this article, I will highlight noteworthy trends in non-alcoholic drinks that I saw at the show. I previously wrote about alcoholic drinks trends and food trends seen at the NRA Show.

1. Cold Brew Coffee Is Hot

Cold brew coffee is one of the fastest growing segments in U.S. beverages in retail and foodservice channels. Retail sales of ready-to-drink (RTD) cold brew coffee grew by 580% from 2011-2016 while cold brew menu penetration grew by +300% from 2014-2016 according to data from Datassential presented by John Buckner of S&D Coffee & Tea. In his “Cold Brew Coffee: Why Is Hot?” presentation, Buckner told the NRA Show audience that cold brew coffee offers an opportunity for foodservice operators to grow beverage sales, reach millennials, and charge more on a per cup basis than traditional iced coffee by offering a premium, smooth tasting product.S&D Coffee & Tea offered multiple cold brew coffee variants including black, flavored, nitro, and soft serve ice cream at its booth. 

There was no shortage of cold brew coffee at the show as numerous exhibitors offered up bean bags, liquid concentrate, kegged, and RTD versions. Tradecraft Outfitters  hosted a mobile pop-up that featured Metropolis, Stumptown, and Stumptown nitro cold brew coffees on tap as well as a stand offering  RTD cold brew coffees from La Colombe, Limitless, Metropolis, Passion House Coffee Roasters, Stumptown, and Zingerman’s.  Califia Farms and High Brew Coffee showed their RTD cold brew coffees while BUNN showcased their Nitron Cold Draft Dispenser that uses one gallon concentrate BIBs (beverage-in-boxes) or caddy packs instead of kegs. Royal Cup Coffee and Tea offered personalized coffee by allowing visitors to create “Nitro Art” with the Ripple Maker that prints image or text onto coffee foam. The company offered two nitro cold brew options: Royal Cup French Roast Cold Brew Coffee and HC Valentine Aztec Organic Cold Brew.

2. Rising Interest in Gourmet and Specialty Coffees

Not only are millennials driving growth in cold brew coffee, they are also driving growth in gourmet and specialty coffees. Millennial coffee drinkers are highly interested in handcrafted beverages, unusual flavor combinations, and learning the stories behind the coffee growers and roasters. I had a chance to speak to Lavazza North America’s CEO and EVP, Davide Riboni at the show. Riboni discussed how American consumers are looking for a higher quality product and increasing their consumption of espresso-based beverages (EBBs) such as cappuccinos, lattes, and macchiatos, especially away from home. He said that EBBs have about 20% market penetration in the US and thinks it can get to 50% penetration. In addition to competition from espresso, drip filter coffee is decreasing in popularity in the U.S. because of the convenience offered by single-serve pods from Keurig and Nespresso.

To appeal to consumers looking for gourmet coffees and help its hotel and restaurant customers grow their coffee business, Lavazza is providing more single-origin coffees that offer storytelling potential. At the show, the company showcased its new Lavazza KAFA Forest Coffee from Ethiopia as well as relaunching the Tierra Single Origins line of Rainforest Alliance, sustainably produced coffees from Brazil and Tanzania. KAFA offers uniqueness due to its limited production and geographic origin as arabica coffee is thought to have originated in this region. Unesco has acknowledged Kafa as a “biosphere reserve”. To emphasize the luxury aspect of Lavazza KAFA, the company offered workshops that served KAFA in three different ways including a pour over with cinnamon and ginger (and served with a side dish of popcorn as done in Ethiopian coffee ceremonies) and as a coffee mocktail with cold brew coffee and Monin cherry syrup to bring out the cherry notes in the coffee.

Lavazza was not the only coffee company at the show emphasizing the origin of its coffees. Coffee Planet’s booth signage stated that the company “was born in Arabia where Arabica coffee was first roasted over 500 years ago”. After starting up in the United Arab Emirates (UAE) in 2005, Coffee Planet signed partnerships to serve its coffee in highway convenience stores, expanded into hotels and supermarkets, and developed a franchised café concept in the UAE before expanding into international markets. Coffee Planet now wants to expand into the US foodservice market. 

3. Healthier Sodas and Soda Alternatives

Volume sales of carbonated soft drinks have been declining in recent years as health conscious consumers seek to reduce consumption of sugar and artificial sweeteners. To retain consumers, soft drinks companies are turning to new product launches and acquisitions to offer “healthier” sodas and soda alternatives that provide flavor and bubbles minus the high fructose corn syrup. The Coca-Cola Company introduced the Barrilitos Aguas Frescas line of fountain drinks that contains 50-60 calories per 8oz serving. Modeled after Mexican aguas frescas, the Barrilitos Aguas Frescas in Horchata and Tamarind varieties are flavored with fruit juices, purees and/or spices. PepsiCo sampled its line of Stubborn Soda that was launched in select foodservice channels in a fountain format in 2015. Stubborn Soda contains 90-100 calories per 12oz serving and is made with Fair Trade certified cane sugar and stevia.

After completing its purchase of Bai Brands LLC in January 2017, Dr Pepper Snapple Group, Inc. showcased Bai's 5-calorie drinks (per 11.5oz serving) including Bai Bubbles that are sweetened with erythritol and stevia leaf extract). Tractor Soda Co offered Tractor Organic Crafted Soda that is USDA-certified organic and made with organic raw cane sugar, organic fruits, herbs, and spices. Another organic soda offering at the show was Brooklyn Organics Craft Ginger Ale that contains 5-10 calories per 8.4oz serving that is sweetened with organic stevia leaf extract. 

4. Iced Teas Aim to Attract Health Conscious

Tea companies are aiming to pull away consumers from soft drinks by emphasizing its refreshing and healthy properties. Tiesta Tea has been selling loose leaf tea blends in retail channels.  At the show, Tiesta Tea noted how “tea attracts millennials” and that its loose-leaf tea blends offer functionality such as slenderizing (Lean Green Machine Light Citrus Green Tea) and age defying (Blueberry Wild Child Blueberry Hibiscus Fruit Tea). Rishi Tea launched its Craft Brew Sparkling Tea & Botanicals line of sparkling tea and botanicals in one-way recyclable PET kegs. Rishi Craft Brew was created to offer the energy boost of cold brew coffee and the health benefits of kombucha in a product that contains no added sugar or preservatives. The Runner’s High Sparkling Tea contains yerba mate and green tea for the uplift and organic schizandra berries, an adaptogenic herb to restore the body.