Nondairy beverages perceived as healthy and nutritious continue to draw increased consumer interest. Where once shoppers may have had to search out these products at natural retailers, more big-box stores are expanding space on their shelves.
“One of our challenges had always been how do we get mainstream consumers aware of what we’re doing,” said Seth Goldman, a co-founder of Honest Tea who also has the fanciful title of TeaEO. “That’s becoming less challenging as we are seeing retailers take more interest in the product. We’ve even seen some club channels expressing interest.”
Califia Farms’ Director of Marketing Kaitlin Walter adds that helping retailers understand that today’s customer increasingly is looking for a premium experience in the dairy case is also a challenge but notes “that the premium-ization of the dairy case has the potential to bring multiple benefits, including increased profits, new customers with a thirst for a premium beverage (whether cold brew coffee, almond milk or dairy) and increased traffic to the back of the store.”
Plant-based milks bear fruit
Almond milk continues its rise in popularity. For the 52 weeks ended Aug. 9, 2015, Chicago-based market researcher IRI reported that dollar sales rose 16.1% in the almond milk category.
“The opportunities are ripe in a channel — nondairy — that is rapidly growing and millennials are a very important driver of this growth: 56% of them drink almond milk. Hispanics are also a growth driver: 54% drink almond milk,” said Califia Farms’ Walter. The company’s horchatas (a traditional and popular Latin American drink) are made with almond milk. They were introduced as a seasonal SKU earlier in 2015 but have been so popular they will be sold year-round. Two flavors (Vanilla Coconut and Classic Cinnamon) are available in 48-ounce bottles.
Also in 2015, the company debuted almond milk coffee creamers in original, hazelnut, vanilla and pecan caramel in 32-ounce paper aseptic packages as well as 10.5-ounce bottles of vegan protein almond milk in chocolate and vanilla.
Silk, owned by The Whitewave Foods Co., added a cashew milk to its line of plant-based beverages. In April, half-gallon sizes hit shelves in four flavors: original, unsweetened, vanilla and chocolate. The company’s first foray into cashew milk, the line is verified by The Non-GMO project.
Coffee drinks with a shot of flavor
While just a small part of the overall ready-to-drink coffee segment, cold brew coffee continues to increase. Mintel reported that the category was expected to grow 115% from 2014 to 2015, reaching almost $8 million in sales.
Califia Farms added three flavors to its line of cold brew coffees made with almond milk: Triple Shot, Mocha Mexica and Dirty Chai. All are sold in 10.5-ounce bottles, along with a new holiday flavor, Peppermint Mocha. Califia is opening a new 62,000-square-foot distribution warehouse in November next to its existing bottling plant in Bakersfield, Calif.
Gevalia(owned by the Kraft Heinz Co.) made its first step into the ready-to-drink iced coffee segment with Gevalia Iced Coffee with almond milk in three flavors: mocha, vanilla and caramel. They are sold in 11.1-ounce and 33.8-ounce aseptic packages.
Tea blooms with botanical flavors
Honest Tea, owned by the Coca-Cola Co., introduced two unsweetened, caffeine-free herbal iced teas this year: Cinnamon Sunrise and Ginger Oasis. Both are available in 16-ounce glass bottles.
The brand also had its first expansion into a national restaurant channel when it teamed with Wendy’s to create an exclusive beverage. Honest Tropical Green Tea is a proprietary blend of Fair Trade Certified, organic green tea leaves with hints of mango and pineapple flavors, sweetened with Fair Trade Certified organic cane sugar. It is brewed daily in participating Wendy’s.
Honest Tea’s Seth Goldman sees the growth in organic beverages being driven by consumers looking for alternatives and “retailers and restaurants adapting. Especially with a channel like Wendy’s, not everything is going to be organic but you pick a few strategic points for those who have a more mindful approach to food. Where you can have organic on the menu, you do it.”
Buddha Teas recently debuted a line of fruit tea blends: Sweet Strawberry Ginger, Pineapple White Tea, Blueberry Black Tea and Rich Raspberry Pu-Erh. The loose-leaf teas in a bag are made with real fruit pieces and no added flavoring. The company has made a big push this year to branch out into the retail market with such retailers as Kroger, Whole Foods and Bed Bath & Beyond.
Lemonade and coconut water
Honest Tea also expanded its line of organic Summer Refreshers with Watermelon Lemonade. Sweetened with Fair Trade Certified cane sugar, the limited release was available in a 32-ounce glass bottle exclusively at Whole Foods.
In the premium water category, Zico expanded its offerings with Natural Organic Fair Trade Coconut Water. The shelf-stable organic offering is available in 16.9-ounce paper cartons. Zico Watermelon Raspberry Flavored Coconut Water, in a 14-ounce resealable bottle, debuted nationwide in April. The company also launched 8.45-ounce cartons for both its Zico Natural and Chocolate flavored coconut waters.
New from Essentia Water this year was a 12-ounce, 12 pack available in select retailers such as HEB and Fresh Market. Coming in 2016 the company will make a push into convenience stores with a 700-milliliter sports cap offering of its alkaline water. This year also saw the addition of Essentia being manufactured in Eventide, Texas. The firm also has facilities in California and Pennsylvania.
52 weeks ended Aug. 9, 2015. Total U.S. Multi-Outlet w/ C-Store (Supermarkets, Drugstores, Mass Market Retailers, Gas/C-Stores, Military Commissaries and Select Club & Dollar Retail Chains). Source: IRI, Chicago