Trend article
Key trends driving the Ready-to-Drink market
Chilled coffee, teas, smoothies and functional drinks: prepared beverages have become an integral part of the refrigerated aisle. The Ready-to-Drink (RTD) market is booming, but what drives this chill but dynamic market? Let’s dive into some key trends!
Ready-to-Drink coffee: market size & growth
The Ready-to-Drink coffee market is characterized by pre-packaged coffee beverages that are ready for immediate consumption without the need for brewing or additional preparation. It’s experiencing significant growth: the RTD coffee segment is expected to grow at an average CAGR for value of 3.7% by 2033, for tea this is 4.4%1.
Key drivers for the Ready-to-Drink market
The surge of this relatively new segment can be attributed to several factors.
- Convenience & busy lifestyles
One of the primary drivers is the ever increasing consumer preference for convenience. Busy, urban lifestyles have led to a growing demand for quick, grab-and-go formats. Packaging must be lightweight, durable, and intuitive.
- Increasing coffee consumption
The global demand for coffee stays high, both in established markets such as North America and Europe, and in emerging markets where coffee consumption is growing rapidly. The RTD coffee market is not limited to just traditional coffee drinkers; it spans a wide array of industries due to its versatility and broad consumer appeal2. On top, consumers are starting to drink coffee at a younger age3.
- Expanding distribution channels
The popularity of Ready-to-Drink beverages grows together with their accessibility. Off-trade, on-trade as well as e-commerce: each retail channel has its own dynamics and characteristics4.
A channel not to be underestimated are direct-to-consumer sales channels such as brand websites and social media that allow brands to engage directly with consumers and drive sales through targeted marketing efforts.
- Product innovation
Different strokes for different folks. The RTD market is bulking with innovative products, Ready-to-Drink coffee being one of the fastest growing segments. Cold brew, nitro, low-sugar and plant-based options, specialty flavors such as chocolate, vanilla, caramel, … cater to varied consumer tastes.
- Health-conscious consumer preferences
A lot of product innovation is also linked to consumers that are reaching for drinks that do more: energy, protein, immunity, hydration. RTD beverages deliver this in a convenient, measurable dose.
And what about RTD packaging?
Ready-to-Drink packaging comes in different types and materials: from cans and bottles to Tetra Packs and plastic. The main considerations for packaging are convenience and portability. As the eco-consciousness of consumers grows, sustainable packaging is gaining traction. In 2022, 78% of Dutch consumers considered sustainability when making purchases, prompting brands to adopt eco-friendly packaging solutions (source: renub.com). This is where mono-material can deliver added value.
Eye-catching shelf appeal for chilled drinks
Discover IML for the Ready-To-Drink market
Sources
1 Global Data - Industry Insights: Opportunities and Innovation in RTD Tea and Coffee July 2024
2 https://www.verifiedmarketreports.com/product/ready-to-drink-coffee-market/
3 https://www.gourmetpro.co/blog/coffee-market-trends-expert-insights
4 https://www.custommarketinsights.com/report/ready-to-drink-rtd-coffee-market/